SHARIAH GOVERNANCE: SOME PROBABLE CHALLENGES THAT MAY BE FACED BY SHARIAH COMMITTEE (SC) AT ISLAMIC FINANCIAL INSTITUTIONS (IFIs)

Abstract

Shariah governance is an integral part of the Islamic Financial Institutions to ensure that all operations and activities always conform to the Shariah principles. The duty of ensuring the Shariah governance is entrusted on the Shariah committee of the IFIs. The aim of this study is to explore some probable challenges that the Shariah committee may encounter while discharging their duty. The study adopts doctrinal approach which utilizes descriptive approach of qualitative research methodology which relies on secondary data in form of textbooks, journals, newspapers, related websites etc. The study found that there are certain challenges the Shariah committee may likely face while performing their duty i.e., ignoring Shariah committees’ (SC) recommendations by the management; lack of Independence of Shariah Committee (SC); variations in fatwa of different Shariah committees (SC); and multiple appointments of Shariah committee member. The researcher then recommended probable solutions to the said challenges.