Please provide a thorough explanation and elaboration of what is the concept, basic facts/ basic theory, major ideas, background and practices of Shari'ah "Islamic Law" Governance, what the basic theory behind it and how it works compared to best practices of corporate governance.
Provide cases and comparisons and contrasts with non-Shari'ah or conventional corporate governance practices. Are there any arguments or examples in support of the above mentioned?
What is the conclusion of the above comparisons and contrasts? What precautionary measures should Islamic financial institutions take to avoid non-compliance with Shari'ah governance standards? What is the contribution of Shari'ah governance standards to the financial systems and corporate governance best practices and the economy at large?
The basis of Islamic law governance is the Shari-at. The Shari-at has several requirements such the Hisbah which imposes duties on businessmen. These include correct weights and measures, preventing frauds, correcting illegal contracts, free market, fair trading rules, and no hoarding of necessities. In addition, there are principles of fair mutual justice with equal importance to all. The business must be carried out in accordance with moral principles enunciated by the Holy Quran. According to the Shari-at human beings are trustees of Allah and the ultimate trust is to keep in Allah, the ultimate owner. The business people must uphold the principles of truthfulness, fairness, tolerance, and justice. The business must be just, fair, and honest to all people. The most important tenet of Shari-at is the prohibition of riba or interest.
The similarities with the best practices of corporate governance is that the requirements of Shari-at such as correct weights and measures, prevention of fraud, and ...
This solution explains Shari'ah Islamic Law Governance. The sources used are also included in the solution.