Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability
Integrating ESG (Environmental, Social, and Governance) principles into Islamic finance presents opportunities for aligning financial activities with sustainable and ethical considerations. While there are challenges and areas for improvement, the potential synergies and shared principles between ES...
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| Format: | Article |
| Language: | English |
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SHPMedia Sdn Bhd
2024
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| Online Access: | https://repo.uum.edu.my/id/eprint/31409/1/PA%2040%202b%202024%2012-19.pdf https://doi.org/10.59953/paperasia.v40i2b.84 |
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| author | Ab Rahman, Sazana Ahmad, Nor Hayati Che Arshad, Noraziah |
| author_facet | Ab Rahman, Sazana Ahmad, Nor Hayati Che Arshad, Noraziah |
| author_sort | Ab Rahman, Sazana |
| collection | UUM |
| description | Integrating ESG (Environmental, Social, and Governance) principles into Islamic finance presents opportunities for aligning financial activities with sustainable and ethical considerations. While there are challenges and areas for improvement, the potential synergies and shared principles between ESG and Islamic finance provide a promising avenue for sustainable and socially responsible investment within Islamic finance. However, past studies have not thoroughly researched key aspects of Islamic finance, such as the sustainability concerns of Islamic deposits, their interaction with macroeconomic variables, and their particular impacts on firms. Therefore, this study aims to examine the macroeconomic and firm-specific effects on the sustainability of Islamic deposits. The sample in this study consists of 13 Islamic banks in Malaysia. The data period covers from 2018 until Quarter 3 of 2022. The data type is cross-sectional from secondary sources: Islamic banks' financial reports, Bank Negara Malaysia, Department of Statistics of Malaysia, and the World Bank. This study adopts a quantitative analysis approach using one dependent variable (Islamic deposits), three independent variables (gross domestic product, inflation, overnight policy rate), and one control variable (firm-specific). An estimated model using the panel data correlation and regression with the fixed effects model was conducted to test the developed hypotheses. Then, the panel data regression analysis continues with the Least Square Dummy Variable (LSDV), which includes the control variable to test the presence of the firm-specific effects. The findings show that only one macroeconomic factor, inflation, affects how well Islamic deposits are sustained. It is also evidenced by the findings that firm-specific effects impact the sustainability of Islamic deposits |
| first_indexed | 2025-02-19T02:29:46Z |
| format | Article |
| id | uum-31409 |
| institution | Universiti Utara Malaysia |
| language | English |
| last_indexed | 2025-02-19T02:29:46Z |
| publishDate | 2024 |
| publisher | SHPMedia Sdn Bhd |
| record_format | eprints |
| spelling | uum-314092024-11-18T08:31:18Z https://repo.uum.edu.my/id/eprint/31409/ Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability Ab Rahman, Sazana Ahmad, Nor Hayati Che Arshad, Noraziah HB Economic Theory Integrating ESG (Environmental, Social, and Governance) principles into Islamic finance presents opportunities for aligning financial activities with sustainable and ethical considerations. While there are challenges and areas for improvement, the potential synergies and shared principles between ESG and Islamic finance provide a promising avenue for sustainable and socially responsible investment within Islamic finance. However, past studies have not thoroughly researched key aspects of Islamic finance, such as the sustainability concerns of Islamic deposits, their interaction with macroeconomic variables, and their particular impacts on firms. Therefore, this study aims to examine the macroeconomic and firm-specific effects on the sustainability of Islamic deposits. The sample in this study consists of 13 Islamic banks in Malaysia. The data period covers from 2018 until Quarter 3 of 2022. The data type is cross-sectional from secondary sources: Islamic banks' financial reports, Bank Negara Malaysia, Department of Statistics of Malaysia, and the World Bank. This study adopts a quantitative analysis approach using one dependent variable (Islamic deposits), three independent variables (gross domestic product, inflation, overnight policy rate), and one control variable (firm-specific). An estimated model using the panel data correlation and regression with the fixed effects model was conducted to test the developed hypotheses. Then, the panel data regression analysis continues with the Least Square Dummy Variable (LSDV), which includes the control variable to test the presence of the firm-specific effects. The findings show that only one macroeconomic factor, inflation, affects how well Islamic deposits are sustained. It is also evidenced by the findings that firm-specific effects impact the sustainability of Islamic deposits SHPMedia Sdn Bhd 2024 Article PeerReviewed application/pdf en cc4_by_nc https://repo.uum.edu.my/id/eprint/31409/1/PA%2040%202b%202024%2012-19.pdf Ab Rahman, Sazana and Ahmad, Nor Hayati and Che Arshad, Noraziah (2024) Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability. Paper Asia, 40 (2b). pp. 12-19. ISSN 0218-4540 https://www.compendiumpaperasia.com/index.php/cpa/article/view/84 https://doi.org/10.59953/paperasia.v40i2b.84 https://doi.org/10.59953/paperasia.v40i2b.84 |
| spellingShingle | HB Economic Theory Ab Rahman, Sazana Ahmad, Nor Hayati Che Arshad, Noraziah Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability |
| title | Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability |
| title_full | Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability |
| title_fullStr | Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability |
| title_full_unstemmed | Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability |
| title_short | Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability |
| title_sort | macroeconomic and firm specific effects on islamic deposits sustainability |
| topic | HB Economic Theory |
| url | https://repo.uum.edu.my/id/eprint/31409/1/PA%2040%202b%202024%2012-19.pdf https://doi.org/10.59953/paperasia.v40i2b.84 |
| work_keys_str_mv | AT abrahmansazana macroeconomicandfirmspecificeffectsonislamicdepositssustainability AT ahmadnorhayati macroeconomicandfirmspecificeffectsonislamicdepositssustainability AT chearshadnoraziah macroeconomicandfirmspecificeffectsonislamicdepositssustainability |