Al Maqashid Syariah Performance in Islamic Bank

This study is aim to examined the effect of maqashid syariah performance. This study employed Maqashid Syariah Index and content analysis as the method of analysis. The Islamic Banks usually employed the conventional yardstick in measuring the IBs performance and firm value. Otherwise, this yardstick is not fit with the condition of IBs. Therefore this study suggests the usage of the IMSPM as the tool measurement of IBs performance, that more complete than the conventional yardstick. This study had important contribution for practitioners of IBs and also Islamic accounting researchers.


INTRODUCTION
In Indonesia, the development of Islamic Banks is growing rapidly and it reaches 10% of the growing process per year, this phenomenon encourages the strict competition between Islamic Banks and conventional Banks (OJK, 2020). There are about 189 Islamic Banks in Indonesia and generally there are 520 Islamic Banks around the world. This is due to the rising economies in Moslem countries. The increasing number of Islamic Banks was closely related with the Islamic Accounting for Islamic Bank regulation and policy, because in order to get its trustworthy from the stakeholders, the Islamic Bank should disclose the financial information towards financial statement which is published periodically. The Bank activity and operation is describing in the financial and management performance which could be seen in the annual report. Generally annual report is giving information about profile, vision, mission, business performance and business activity, including charity and social values of an enterprise. Islamic Banking delivers their corporate activity via communication in annual report. The information which is given by Islamic Banking could become an important data for the internal and external stakeholders. Commonly the stakeholders and researchers only highlighted the information about the financial performance, but do not pay attention deeply about the Islamic values (Rudi, et.all., 2019). This Phenomenon is caused by the case that conventional Banks still become the benchmark of the Islamic Banks (Austay and Harningtyas, 2015).
According to the author, this case occurred because the measurement method of the conventional Bank is not suitable with Islamic Banks. Some of Islamic finance experts stated that the principles of conventional Banks are based upon the western economy paradigm. This paradigm puts capital owners to gain the most benefit in the economic system or well known as capitalist system . On the other hand, Islamic Banks offer Islamic economic concept that put human behavior based upon the spirit and norms of Qur'an and Sunnah (Hosen et.,all., 2019). Moral, ethics and social values are the core values of Islamic business. The application of Islamic spirits and norms in Islamic Banking could be measured by using Maqashid Syariah Index (Hartono, et.,al., 2017). The other researchers also stated that the decision making based upon the conventional principles is not enough to fulfill the need of the annual report user, especially the Islamic stakeholders (Hanifa and Hudaib, 2007). This is furthered supported by the statement by Hartono et.,all., (2017) and Wahyuni et.all., (2020) that the annual reports of Islamic Banks have to disclose about the moral, and ethics, as well as social values which is rooted from Maqashid Sharia performance. Contrary the other scholars argued that the conventional measurement is enough and clear to calculate and explain about the Bank conditions (Al Matari, et., all, 2014;Rashid, et.all., 2017).Therefore, the research about Islamic Values in the annual report demands to be investigated deeply in a new research which takes the new, updated and more data. The recent study have been discussed about the adoption of Maqashid syariah Index as a tool to measure Islamic Bank performance, which used content analysis as the analysis tool. Meanwhile, the study that has been examined about this issue remains insignificant (Hidayat and Usman, 2021). On this paper, the author aims to study about this issue from Intergrated Maqashid Syariah Performance Measurement (IMSPM) Index explained by Mohammed, et. al (2015).

METHOD
This research employee Maqashid Syariah Performance as the independent variable (X1) which is measured by IMSPM. There are 10 samples of Islamic Banks. The object of the research is annual report which is collected from each website of the Islam Banks from 2016 to 2020. The population is Islamic Bank in the world and the sample is the 10 best Islamic Banks in the world. The author has been collected the secondary data from website of the Islamic Bank. In this paper the author used Maqashid syariah index or IMSPM in measuring Islamic Banks performance, and this measurement has been used by Noordin and Hudaefi (2019).   (2019) The table above gives information about the concept, dimensions, element and the ratio (performance ratio) which has been employed in order to measure each element of Maqashid syariah performance. IMSPM = P1 (01)

RESULT AND DISCUSSION
The first step that has been done was collecting data from each of IBs websites and then the author employed the yardstick of measuring maqashid shariah performance using the formula which was adopted from Hudaefi & Noordin (2019). This current work has examined 10 samples IBs performance which is from 7 different countries. The author chooses these samples used purposive sampling method. After collecting the data, the samples were computed using performance ratio (PR). Furthermore, the authors multiply the results of PR equations with the assigned weight of IMSPM. The calculation has been done by using Microsoft Excel because of its accuracy reason. The result of IMSPM analysis has been shown in Table 2. Based upon the data on the table 2, the sample which had the highest ratio for the objective of faith (din) was Al Baraka Bank Egypt. According to Al-Ghazali theory that interpreted by Ibn Ashur, this achievement reflected Al Baraka Bank Egypt's high commitment to establish IBs that adhered the Syariah principles and its effort to create society awareness to the existing of Islamic Bank on their country (Khatib, 2018). This is also supported by the management statement on Al Baraka Bank Egypt annual report: "Al Baraka Bank of Egypt S.A.E is one of the most leading distinguished financial institutions in the business of Islamic banking in Egypt, as started to practice its various activities and business more than thirty years in accordance with the provisions of the tolerant Islamic Shari'a, and Bank was able to impose itself strongly in the banking market in Egypt in view of the integrated system of solutions (Al Baraka Bank of Egypt, 2020,p.7)" The sample that recorded the highest ratio for the objective of self (nafs) was Amana Bank SriLanka. This achievement portrayed the Amana Bank commitment to adhere and embrace the Islamic values and principles on their organization by providing the independent sharia supervisory council. This finding confirmed that the IBs had been adhered the AAOIFI standard and regulation, AAOIFI standard had been stated that the Islamic Bank should explain about the role and members of Independence of Shari'ah Supervisory Board on the annual report. This finding supported by the disclosure on the annual report, that report about the shiariah supervision goals: "The Sharia Supervision Department focuses on matters pertaining to the rules and principles of Sharia, enabling the facilitation of smooth operations whilst ensuring Sharia compliance at all levels in the Bank. Staff within the department were encouraged to perform their duties from home, as far as possible, after the country was affected by the outbreak of Covid-19 pandemic in March 2020. (Amana Bank SriLanka,2020,p.72)" The sample which had the highest value on the objective of intellect (aql) was Bank Muamalat Indonesia. This result portrayed the BMI spirit and commitment in supporting education in Indonesia that had been disclosed in their annual report. This finding supported the Ghazalian theory, especially the concept of intellect which was reflected by the education grant (Hartono & Sobari, 2017 The sample that achieved the highest proportion on the objective of posterity (nasl) was Amana Bank SriLanka. This result indicated that Amana Bank SriLanka had high commitment in supporting the government and society mainly in protecting the posterity; this is proven by the Amana Bank SriLanka activity during the emergency condition which was portrayed on the disclosure on the annual report: "The Covid-19 pandemic shifted many paradigms during the year, but the Bank continued to extensively support effective and sustainable Corporate Social Responsibility initiatives. With the pandemic affecting and putting a strain on several areas of livelihood and economies, the Bank extended its support to government, healthcare workers, individuals, families, businesses and micro enterprises. (Amana Bank SriLanka, 2020,p.82)". The finding in the objective of posterity confirmed and explained the Ghazalian theory, Ibn Ashur interpreted that the protection of posterity was reflected by the IBs commitment in creating brotherhood bonding between the IBs and its stakeholders including customers, employee and the society that lives around the IBs (Nurhadi, 2019).
The sample which recorded the highest ratio under the objective of wealth (mal) was Al Hilal Islamic Bank Kazakhstan and followed by AlBaraka Bank Egypt. This achievement reflected that the IBs prioritized the balanced between the IBs return and the stakeholders return as well as the commitment of the IBs in order to minimizing the disparity of the economic level, which was described in the following disclosure: "The total amount revealed by the Balance Sheet as at December 31, 2020 is 75.5 billion Egyptian pounds at a growth rate -despite the pandemic-4%approximately to the previous year (with an average growth rate of 17% to the previous three years approximately). This reflects the customers' trust in the Bank, the positive development of the volume of its business, the growth of its activities and the increase of its market share. " This result supported the Maqashid Syariah Theory, that stated about the fifth concept of Maqashid Al-Syariah (Wealth) (Herlyanto & Oktavendi, 2019). Ibn Ashur interpreted that the existing of wealth dimension in the IBs reflected the IBs major intention in