The Application of the Islamicity Disclosure Index in Measuring Sharia Compliance and Corporate Governance at Bank Aceh and Bank Syariah Indonesia
DOI:
https://doi.org/10.12928/ijiefb.v9i1.15516Keywords:
Islamicity Disclosure Index, Shariah Compliance, Corporate Governance, Social and Environmental Disclosure, Bank Syariah Indonesia, Bank Aceh SyariahAbstract
Introduction to The Problem: Transparency and accountability are fundamental principles in Islamic banking, ensuring compliance with Sharia principles and good corporate governance. The Islamicity Disclosure Index (IDI) has been widely recognized as a comprehensive framework for evaluating the extent of Sharia-related disclosures in Islamic financial institutions. However, empirical comparisons of IDI implementation among Islamic banks in Indonesia remain limited, particularly between national and regional Islamic banks.
Purpose/Objective Study: This study aims to analyze and compare the level of Islamicity Disclosure Index (IDI) disclosure between Bank Syariah Indonesia (BSI) and Bank Aceh Syariah during the 2023–2024 period as an indicator of Sharia compliance and corporate governance quality.
Design/Methodology/Approach: This study employed a quantitative descriptive approach using content analysis of the annual reports of Bank Syariah Indonesia and Bank Aceh Syariah for the 2023–2024 period. The assessment was based on three main dimensions of the Islamicity Disclosure Index, namely Shariah Compliance, Corporate Governance, and Social/Environmental Disclosure, with respective weights of 50%, 30%, and 20%. The disclosure scores were calculated and compared to evaluate each bank's level of compliance and transparency.
Findings: Both banks achieved a very high level of Islamicity disclosure. Bank Aceh Syariah recorded an IDI score of 87.30% in both 2023 and 2024, while Bank Syariah Indonesia achieved higher scores of 96.67% in 2023 and 96.88% in 2024. Bank Syariah Indonesia demonstrated superior performance, particularly in the Shariah Compliance dimension. In contrast, Bank Aceh Syariah exhibited relatively lower disclosure regarding non-halal income, non-halal investments, and several aspects of corporate governance structure. Nevertheless, both banks performed consistently well in the Social/Environmental Disclosure dimension. These findings indicate that although both institutions have maintained a high level of Sharia disclosure, Bank Syariah Indonesia demonstrates greater consistency and comprehensiveness in its implementation of the Islamicity Disclosure Index
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