Islamic Banking Governance: A Conceptual Analysis of Good Corporate Governance and Sharia Governance

Abstract

This article analyzes the concepts of Good Corporate Governance (GCG) and Sharia Governance (SG) in Islamic banking through a literature study approach. GCG focuses on corporate governance principles, including transparency, accountability, responsibility, independence, and fairness. Meanwhile, Sharia Governance emphasizes supervisory mechanisms involving the Sharia Supervisory Board (SSB) in ensuring that bank operations comply with Islamic law. The integration of GCG and SG in Islamic banking is a crucial factor in building public trust and enhancing the global competitiveness of the Islamic banking industry. The study finds that although many Islamic banks have implemented GCG and SG, there are still challenges in their application. These include differences in regulations across countries, the effectiveness of supervision by the Sharia Supervisory Board, and the limited availability of competent human resources in the fields of Sharia and governance.