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This chapter uses panel data techniques to analyze the impact of corporate governance and competition on performance of the firms operating in Muslim and non-Muslim economies. Also analyzed the corporate data of 3,158 firms operating in five non-Muslim economies and 1,785 firms operating in five Muslim economies. It is observed from the results that most of the firm-level variables have similar behavior with firm performance irrespective of ownership structure. It is also found that direct majority-owned firms are more profitable as compared to independent firms irrespective of the operating region. Further, it is also observed that operating environment, specifically governance system, has significant impacts on firm performance.

This chapter explores the historical development of shari’ah governance infrastructures in the Malaysian landscape, pre- and post-Islamic Financial Services Act 2013 (IFSA) and its implications on the industry. This chapter analyzed two approaches developed in the shari’ah governance, namely, the inclusivity and uniformity approach. Inclusivity approach showed that the shari’ah compliance responsibility is shared inclusively by the shari’ah committee together with the institution’s top management. While the uniformity approach showed that the end-to-end shari’ah compliance is achieved through issuance of shari’ah standards that can be easily related by the practitioners into their banking operations and business. The coherence implementation of these approaches has enabled another important stakeholder, the judiciary to have more clarity and certainty in dealing with matters pertaining to Islamic banking and finance. Consumers’ trust and confidence in the financial sector is thereby secured and sustained, hence providing financial stability within the industry, which meets with the expectation and mandate given to IFSA.

Muslim investors must comply with the ethical injunctions prescribed for them while making financial investments. As per Islamic principles, the use of Riba (interest), Maysir (gambling) and Gharar (uncertain or contingent payoff contracts) is prohibited. This chapter provides some recent post great financial crisis evidence on the comparative performance of Islamic and conventional market indices. Islamic indices outperformed conventional market indices in terms of annualized returns except for emerging markets. In the overall period of 2007-16, it is found that Islamic indices have a lower coefficient of variation and hence higher reward to variability ratio. This suggests that Islamic indices are superior to conventional market indices adjusting for variability in returns. In most comparable Islamic and conventional indices, a strong co-movement and long-term co-integrating relationship is found. The results also highlighted causality running from conventional indices to the Islamic indices in most of the market groups, except for the S&P Global.

Cooperatives are formed with the idea of cooperation. Due to their features, cooperatives have the potential to address the issue of poverty alleviation and improvement in income distribution, which currently is the central focus of governments' economic policy making. Currently, Islamic cooperatives or shari'ah-based cooperatives have also been developing well. Shari'ah-based cooperative is essentially the transformation of conventional cooperative through an approach in line with the Shari'ah principles. It could be one of the best solutions in supporting Islamic banking and finance for unbankable customers. This chapter describes the development of cooperatives in Malaysia and Indonesia. The chapter also discusses the need for cooperative governance and highlights the features of cooperatives that results to their governance is more complex that the governance of business organisations. This chapter also highlights laws, regulation and shari'ah governance measures taken by both jurisdictions to promote growth of shari'ah-based cooperatives.

The aim of this chapter is to investigate factors affecting four of the gaps encompassed in the GAP model, which then results in Gap 5, the so-called customer gap, related to the variance between customer expectations and the perception of service quality (SQ). Four predictors were selected based on the literature review – marketing research orientation (MRO), service specification design (SSD), integrated technology (ITC) and integrated communication (ICO) – to examine their relationship with the customer gap. A valid and reliable questionnaire, developed for the purpose of the study, was used to collect data from a sample consisting of 600 employees from six hotels located in Amman, Jordan. The findings show that MRO, SSD, ITC and ICO significantly predict the four gaps in SQ on the provider side, which in turn significantly predict the customer gap. For companies, more attention should be paid to the four gaps that induce the customer gap.

The prime difference between conventional and Islamic financial institutions (IFIs)is the compliance with shari'ah. Hence, shari'ah is a very crucial pillar, rather a main pillar of Islamic finance. In order to ensure shari'ah compliance by the IFIs at all levels, central banks of different countries crafted and implemented shari'ah governance framework. This chapter focusses on the cross-country comparison of shari'ah governance framework. The countries included in this chapter are Malaysia, Pakistan, the United Kingdom and Bahrain. The result shows that Malaysia and Pakistan are leading in terms of comprehensive shari'ah governance framework whereas Bahrain comes next and the United Kingdom is the last in terms of comparison.

The most crucial challenge facing Islamic Financial Institutions (IFIs) is the full compliance of their activities with shari'ah principles. The complexity of IFIs requires Otoritas Jasa Keuangan (OJK, Indonesian Financial Services Authority) to adopt a good shari'ah governance framework to address shari'ah risks of Islamic banking and financial institutions (IBFIs). However, the current shari'ah governance structure in Indonesia is far from ideal compared to the international best practice. This chapter proposes a new shari'ah governance framework by involving shari'ah supervisory board authority (Otoritas Dewan Pengawas Syariah) under the commissioners of OJK to oversight, regulate, and supervise the shari'ah matters for IBFIs in Indonesia. The chapter discusses the challenges in adopting this new framework. The chapter concludes that the current shortcomings of the proper shari'ah governance framework for shari'ah supervision and regulation requires a new shari'ah board authority under the commissioners of OJK who has full authority over shari'ah matters.

This chapter aims to highlight the background of Islamic Financial Services Act 2013 (IFSA). It also highlights experiences of Malaysia in dealing with IFSA. The analysis is tackled along the lines of the background and the constitutional frameworks of the country, the initiatives introduced by the government for the development of shari’ah compliance within the Islamic banking and finance fraternity as well as the relevant organs in carrying out the audit exercises over the Islamic banks and financial institutions in Malaysia. The chapter critically elucidates the implementation of the IFSA and its impact on shari’ah governance. It concludes by suggesting that the areas in the constitutional legal framework of the contemporary Islamic finance in Malaysia support the development of the Islamic banking and finance fraternity as with the shari’ah compliance of the same and it applies to all cooperative society.