Islamic Corporate Philanthropy in Islamic Banking
Implementation of Zakat Regulation and Sharia Compliance in Indonesia
DOI:
https://doi.org/10.21154/justicia.v22i1.10397Abstract
Compliance with the implementation of Law number 23 of 2011 related to zakat management, Article 74, number 40 of 2007, and social responsibility as an obligation that must be budgeted, which is calculated as a company's operational cost, is a must. However, its implementation in the community, which is reflected in the compliance of Islamic Financial Institutions, especially Islamic Banking, shows a gap between the potential of zakat and its realization in the community. Therefore, this study aims to explore empirical evidence regarding the implementation of zakat management compliance and the influence of Islamic corporate philanthropy on the performance of Islamic commercial banks in Indonesia. The research sample was conducted on 12 Islamic Banks registered with OJK. The secondary data of this study were taken from audited and published annual reports from 2017 to 2023. The research method uses the Mix method, data analysis techniques using regression, and legal interpretation analysis. The results showed that there is a significant influence between Islamic Philanthropy Compliance (ICP) and the performance of Islamic banks, and there are examples of banking compliance in the law that can be applied. The level of zakat generated in Islamic banking in the form of IPC turns out to have a positive relationship with financial performance, meaning that the greater the zakat issued, the more it improves long-term financial performance, this is the case.
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