Why Islamic banks are in need of sound corporate governance?

Corporate governance is composed of two terms, viz., corporate and governance. Corporate emanates from the term, Latin “corporare”, which means “to embody”. The term “governance” stemmed from the Latin word “gubernare,” or originally from the Greek word “kubernaein,” that means “to steer”. I define the term “corporate government” as the system of rules, practices and processes by which an Islamic bank is directed and controlled where tawheed and governance of contract matter.

In this article, I draw your attention on the four issues related to sound corporate governance for Islamic banks. In essence, the banks have developed a cogent appro...