Governance of Islamic Banks

Running head : Governance of Islamic banks

Student name

Course name , Code

University , semester , Tutor

Date

Governance of Islamic Banks

1 . Introduction

Effective organizations ' governance forms the major platform for greater harmony of their activities , increased productivity in their areas of specialization , and profitability in their operations . Indeed as Wikson (2007 ) points out , most of the successful organizations have strong administrative governance structures that not only dictate their immediate operations , but set the whole picture of the long term orientation in their services or products provision . As the

theory of organization indicates , governance acts as the rotating fulcrum where all aspects of its operations are weighed to determine the necessary progress (Wilson , 2003

a . Background of Islamic banks

Islamic banks are the banks that operate in consistence with the demands as well as the principles of Sharia [Islamic law] (Choudhury 2001 . Primarily , Islamic banks were found only in Islamic countries until later in the 20th century when they started proliferation globally due to increased spread of the Muslim community . It is worth noting that since historical times their services have been strongly oriented towards serving the Muslims as opposed to the whole community (Timur 2005

With bulk of them being located in the Arabic and the Islamic nations of the Far East and the Middle East , they have seen a new system of modernization that seeks to review their outlook a notion that have cemented their average growth rate at10-15 (Sait and Lim2006 Muhammad (2008 ) points out that there are about...