The Role of Shari’ah Governance in Financial Institutions 

This paper discusses the role of Shariah governance as a fundamental pillar in ensuring the integrity and credibility of Islamic financial institutions. It defines governance as a framework that regulates decision-making, accountability, and transparency while ensuring full compliance with Shariah principles.

A central focus is the Shariah Supervisory Board (SSB), which is responsible for issuing fatwas, reviewing contracts, and monitoring institutional compliance. The paper highlights key requirements for board composition, including a minimum of three qualified members, fixed tenure, independence, and scholarly integrity.

It also emphasizes the importance of transparency, proper documentation of rulings, and disclosure of decisions to stakeholders. Challenges such as maintaining independence, ensuring quorum validity, and balancing Shariah compliance with operational needs are also discussed.