Malaysian’s government linked investment companies : is there a need for shariah governance framework?

Abstract EN

This paper attempts to examine the absence of a shariah governance framework (SGF) in Malaysian's government linked investment companies (GLICS).

a GLIC is essential for the Malaysian economy, while SGF is practiced by the Islamic financial institutions (IFIS) in Malaysia to ensure end-to-end shariah compliant process in the business operation of the banks and takaful operators.

when the GLIC aims to provide shariah compliant returns to their investors (public), the move should be supported by all stakeholders as majority of the investors of the GLICS are Muslims, and thus the demand for a shariah compliant dividend is expected.

as for the IFIS in Malaysia, the central bank of Malaysia requires all IFIS to establish an SGF to ensure their activities comply with shariah principles.

the question arises whether this requirement should be practiced by the GLICS too.

this paper examines the importance of SGF to be established by the GLICS.

since this study is focusing on the importance of SGF in GLICS, interviews and document analysis methods are used for data collection.