Distinguishing Islamic Social Finance from Corporate Social Responsibility: Evidence from a Case Study of the Maldivian Banking Sector
DOI:
https://doi.org/10.53840/ijiefer246Keywords:
Islamic Social Finance; Corporate Social Responsibility; Islamic Banking, Maldives, MISFIAbstract
Purpose – This study investigates the conceptual and operational distinctions between Islamic Social Finance (ISF) and Corporate Social Responsibility (CSR) within the Maldivian banking sector, drawing on a qualitative case study of ISF implementation at the Bank of Maldives and selected policymaking institutions. The study seeks to evaluate bankers’ levels of knowledge, awareness, perceptions, and their capacity to distinguish between ISF and CSR.
Design/Methodologies/Approach – Data were obtained through in-depth, semi-structured interviews with senior management of Islamic banking institutions, complemented by strategic consultations with policymakers, and were analysed using content and thematic analysis methods.
Findings – The findings reveal that CSR is largely perceived as a voluntary, image-oriented, and short-term practice, whereas ISF is conceptualised as a faith-based, ethical, and sustainable financial mechanism aligned with the objectives of Maqasid al-Shariah. Furthermore, the establishment of the Maldives Islamic Social Finance Initiative (MISFI) has contributed to increased institutional awareness of ISF and stimulated the development of ISF instruments. Nevertheless, significant gaps persist in staff capacity-building, governance arrangements, and the availability of standardized implementation frameworks.
Originality/Value – The study is based on an empirical analysis of Islamic Social Finance in the Maldivian banking sector. It offers a rare perspective from a small island development state.
Research Limitations/Implication – The study is limited by its small qualitative sample focused on two banks. Moreover, as the ISF implementation in the Maldives is in its initial stage, the results primarily reflect the initial perceptions.
Practical Implications – This study contributes to the limited empirical literature differentiating ISF from CSR and provides policy and managerial insights for strengthening ISF governance and promoting sustainable socio-economic development in emerging Islamic finance contexts.
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