Shari’ah governance framework of Islamic banking in Oman

Abstract EN

Shari’ah compliance is the backbone for the activities and governance of Islamic banking and finance.

All Islamic banks have responsibility to ensure solid Shari’ah governance to achieve high level of Shari’ah compliance in their businesses and activities.

The Sultanate of Oman is the most recent country among the six-nation Gulf Cooperation Council (GCC) to introduce Islamic finance.

This paper investigates the current practice of Shari’ah governance framework in Oman and its structure and challenges.

Primary data for this study were collected through semi-structured interviews conducted with members of Shari’ah Supervisory Boards (SSB), Internal Shari’ah Reviewer and members of Higher Shari’ah Supervisory Authority (HSSA).

The finding of this paper shows that Oman placed an excellent Shari’ah governance framework and it is considered one of the best frameworks in Islamic banking industry.

However, there are shortcomings and weaknesses in the current practice of Shari’ah governance framework such as, lack of experience, lack of research in field of Islamic banking and finance and low position of internal Shari’ah reviewer Finally, this paper provides some recommendations on how to enhance present Shari’ah governance framework in Oman.