Shari’ah Governance Framework in IFIs in Oman: Issues and Challenges

Abstract

This chapter summarizes the current practice of shari'ah governance framework of Islamic banking entities (IBEs) in Oman and the challenges faced by such institutions. The Central Bank of Oman (CBO) issued proper shari'ah governance framework enshrined in the Islamic Banking Regulatory Framework of CBO. The shari'ah governance framework shall contain shari'ah supervisory board, internal shari'ah reviewer, shari'ah compliance unit, shari'ah risk unit, and shari'ah audit unit. To strengthen the role of shari'ah, the CBO also issued a regulation for the establishment of High Shari'ah Supervisory Authority in CBO to harmonize opinions related to shari'ah matters among the IBEs. These elements are expected to perform an oversight role on shari'ah matters relating to Islamic banking business activities. This chapter also discusses the issues and challenges faced by IBEs in Oman, and proposed some improvement to the CBO to strengthen shari'ah governance framework in the Sultanate.

Citation

Mihajat, M.I.S. (2019), "Shari’ah Governance Framework in IFIs in Oman: Issues and Challenges", Azid, T., Alnodel, A.A. and Qureshi, M.A. (Ed.) Research in Corporate and Shari’ah Governance in the Muslim World: Theory and Practice, Emerald Publishing Limited, Leeds, pp. 249-260. https://doi.org/10.1108/978-1-78973-007-420191022