THE CONCEPT OF GOOD CORPORATE GOVERNANCE IN A SHARIA
PERSPECTIVE TO OVERCOME THE PROBLEMS OF
IMPLEMENTING CORPORATE GOVERNANCE.
Introduction
Good Corporate Governance (GCG) is a mechanism for controlling, regulating and managing
businesses that aims to increase prosperity and accountability, whose ultimate goal is to
create value for shareholders (Lastanti, H., S. (2005). Tjager (2003) draws on the opinion of
Newel & Wilson (2002) that in theory GCG is able to increase the value of the company,
among others, maximizing financial economic activity, minimizing risk as a result
Management activities are inclined to personal interests and in general can increase investor
confidence, while the concept of Corrporate Governancc according to (Khomsiyah.
(2003).Specifically, Governance is a form of ensuring that management functions in the
interests of its stakeholders, which requires strict guarding of the authority of shareholders,
especially minority shareholders.
To achieve GCG's mission of creating value for shareholders, its adoption requires a set of
supporting principles. The basic principles of GCG improved by the Organization for
Corporate Economic Development/OECD (1999) include 5 principles, namely: First,
safeguard shareholder rights. Second, treat all shareholders equally. Third, the role of
stakeholders related to the business. Fourth, openness or transparency. Fifth, director
responsibility.
The principles initiated by the OECD are often used by other countries around the world as a
reference, guide and reference for developing modern GCG principles. The development is of
course harmonized with the legal system, laws or rules that apply in each country if needed.
After all, each country around the world has its own characteristics with different patterns of
law, culture, and residence. It is undeniable that the World Bank and the Organizations for
Economics Cooperation and Development (OECD) have also made important contributions
to the improvement of corporate governance principles in many countries (including United
States). The principles or guidelines for implementing corporate governance not only protect
shareholders but also all stakeholders in the company, including the community.
Although these principles have been established, their implementation is not yet similar to
what is desired or still full of obstacles. These obstacles or barriers will affect the
implementation of GCG. These obstacles follow FCGI in Emirzone (2007: 239), namely On
the one hand, there are still many companies that operate in the form of family companies or
closed companies; Second, employers have not submitted news; Third, entrepreneurs who do
not understand GCG; Fourth, GCG Principles are only indicative and not mandatory or
desirable.
These obstacles can essentially be minimized if all relevant employees have the same
understanding of the importance of GCG in providing value to shareholders. And all
employees must also have a similar understanding of the concept that business is a place of
trust for stakeholders. Therefore, the management of the company must be done in the best
possible way and in a very responsible manner.
The implementation of GCG that has not been able to run effectively is a phenomenon that
needs to be considered to find solutions to overcome these shortcomings. "Why is it that until
now this theory is still poorly implemented, perhaps because the system and is the culture not
supportive? Or is there an error related to the concept? Referring to this incident, this study
aims to initiate GCG principles in building Sharia, in order to minimize obstacles in the
application of good corporate governance and find solutions to existing problems. From this
background, the main conflict of this study is how the concept of GCG in Sharia.
Theoretical Study
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
Unveiling the Veil of Good Corporate Governance
Related types of GCG guidelines developed by experts have a purpose. The goal is to realize
good corporate governance for professional and effective business practices (Indrayani, 2001:
33). Referring to the OECD version of GCG principles which includes 5 principles, we
describe them:
Principle of Protecting Shareholder Rights
This principle prioritizes the protection of all shareholder rights, which include:1st, the rights
of shareholders, including: how to register ownership, transfer, transfer shares, obtain
company information in a timely and periodic manner, attend the General Meeting of
Shareholders, actively participate in the election of the Supervisory Board. 2nd, the right of
shareholders to play an active role in the company as well as the right to be informed about
the provisions related to the fundamental modification of the company, for example: (a)
changing the company's charter (similar documents); b) sharing additional control; c) unusual
negotiations after marketing the business. 3rd, the right of shareholders to obtain a similar
period and effectively participate and have the right to express opinions in the general
meeting of shareholders (GMS) and must provide news related to the code of conduct,
including voting procedures that affect shareholders. 4th, the right to disclose that there may
be a disproportionate or disproportionate capital structure resulting in some shareholders
having a level of control that is not equal or proportional to the percentage of shares they
own. Fifth, the right to control the company's market must operate effectively and openly, for
example with regard to laws and procedures that affect the company's control in the capital
market and unusual negotiations, such as integration and others. Finally, the right of
shareholders, including institutional investors, to take into account the voting rate and
usefulness.
Principle of Equal Treatment of All Shareholders
This principle promotes equal treatment of all shareholders, whether majority or minority or
otherwise, with respect to all their rights, namely the right to fairness or equal treatment, the
right to be protected from abuse and internal self-determination, and all the rights of
shareholders whether majority or minority, in order to expose material needs in negotiations
or matters affecting the terms of business.
Principles of the Role of Stakeholders Related to the Company
This principle considers the duties and collaboration of the various sides concerned in the
business in order to achieve the business. Examples include workers (employees), managers,
shareholders, creditors, investors and governments. Therefore, in the framework of corporate
governance, it must recognize the authority of stakeholders in order to promote efficient
collaboration between the company and all stakeholders to realize prosperity, employment
and economic viability of efficient corporate enterprises. Also, this principle includes the
determination of interested parties in the company, i.e. parties other than shareholders and
company management.
Principles of Openness and Transparency
This principle implies that openness or transparency is a fundamental principle for
companies. News disclosure must be carried out promptly and thoroughly on all matters
relating to the company, including: economic (financial), operating results, business
ownership, corporate governance with the aim of minimizing management risk. Apart from
these ideas, the company must facilitate access to this information for various interested
parties. And also the company must prepare a way to hold directors accountable for every
decision they make. The principle of publicity and openness also prioritizes that the news
disclosed by the company must be prepared, tested and presented in accordance with high
quality standards in this case in accordance with generally accepted accounting principles.
Management must insist on external auditors to carry out a free audit of the financial
statements.
Board of Commissioners Accountability Principle
This principle requires the company to disclose the decisions of the board and management as
a form of responsibility. And it must ensure appropriate direction for the company, effective
audit committee control, and the audit committee's responsibility to shareholders and the
company. This transparency often includes First, the activities of the Board of Directors must
be carried out on the basis of providing complete, honest and prudent news, taking into
account the needs of the company and shareholders. Second, the resolutions of the Board of
Directors may affect the shareholders of the company. Third, the decisions of the board of
directors must demonstrate compliance with existing rules and take into account the needs of
shareholders. Fourth, the decisions of the BOD regarding the company and shareholders must
be made objectively and freely. Finally, the BOD must have a true, significant and timely
news channel.
The Beginning of an Exploration to Understand Shari'ate Enterprise Theory
SET exists because of efforts to construct Islamic accounting, applying the principle of
tawhid to the concept of business theory, which ultimately gave birth to a more humane,
transcendent, and directed concept theory. Thus, it can be explained that the concept of SET
exists on the basis of the belief that shahadatain (the value of tawhid) recognizes the
existence of God Almighty and there is no God other than 'Allah.
Research Methods
The purpose of this research is to reconstruct the concept of GCG that previously existed
within the framework of Sharia. Therefore, it can be mentioned that this research is research
in the field of non-positivism. Therefore, this research utilizes alternative or (qualitative)
research methods. By using this approach, the researcher conducted the following analysis:
First, the OECD version of GCG concepts and principles were considered as the object of
research. Second, analyzing the OECD version of GCG Principles from a Sharia perspective.
Third, reconstructing the OECD version of GCG principles to create new GCG principles that
are full of Sharia values. In this study, data were collected through documentation (Moleong
1991:6). Documentation in the form of theories about the OECD version of GCG in
literature, books, journals, magazines, newspapers, articles, and references to previous
research that supports this research.
Results And Discussion
Analyzing Good Corporate Governance from a Shari'ah Perspective
The concept of Sharia is the most important and most important basis in the formation of
GCG principles in the development and application of Sharia is: First, God is the origin of
faith and his servants are the bearers of faith; Second, humans are God's representatives;
Third, the wealth of the Muslim community has the rights of other people, namely the parties
entitled to receive zakat, including the poor, orphans, Ibn Sabil etc. which are realized by
zakat, infaq and alms.
A Form of Good Corporate Governance Based on Sharia Perspective
When discussing the concept of Shari'ah Good Corporate Governance in Islam, it is always
related to the inequality between business theory and Shari'ah Enterprise Theory (SET),
meaning that God is the focus.Using SET values, including the values of justice, trust and
responsibility, the researcher in this study tries to deconstruct the available OECD version of
the GCG concept in order to get the same values and personality as SET. In the future, the
rules contained in SET will be used as a filter that can be used to justify whether the OECD
version of the GCG concept is the same as SET or not.
If we take a closer look at the concept of GCG, it can be said that the concept of GCG already
contains the values of justice, trust and responsibility contained in SET and shows the same
tendency between the two. The similarity of the tendency is the value of justice, while aiming
to provide partiality to parties who at any time and anywhere may have a need for the
company. Furthermore, this concept also does not emphasize equal distribution of welfare,
but rather equal distribution of welfare to stakeholders is equivalent to the participation
distributed to the company. The value of faith, viz. Both believe that resources are a trust that
must be managed for the good of others. Thus, this mission is carried out in order to generate
wealth for all stakeholders, both anytime and anywhere. The value of accountability, i.e. both
believe that resources are entrusted for the common good and are accountable to the trustee.
In other words, resources are an order that must be used to create wealth for all concerned
when needed whenever and wherever.
The purpose of khilafah in this world is to spread mercy to all creatures (rahmatal lil 'alamin).
However, what makes the difference between the two is the origin of faith. Because we know
that GCG and the values that underlie it are the origin of the trust of shareholders, the sense
of responsibility it carries is limited only to the responsibility addressed to these shareholders
(horizontal responsibility). In SET, the ultimate origin of faith is God, the only one who
controls and owns the entire universe. As a result, SET obligations are not only horizontal
(towards shareholders and the nature of the company) but also vertical (towards God).
Perspective of Good Corporate Governance According to Sharia to Solve the Problem of
Implementing Good Corporate Governance in United States.
Islam points out that the purpose of life (business) is not only material (the creation of
measurable value in material goods), this is in line with what was described on the previous
page, that for Islam wealth is the ultimate goal of the five goals of Sharia. Recall that in Islam
the goal of human prosperity is well-being (happiness) not in this world but in the hereafter as
well. Thus, good governance from a Shariah perspective should be seen from the following
example, which is said to be an example of the Shariah GCG concept, as explained below:
Siddiq means truth or honesty and emphasizes words, beliefs and behavior according to
Islamic principles. Without any contradiction or difference that is deliberately left between
words and deeds. Furthermore, the word of Allah: "O you who believe, fear Allah and be
with those who are righteous (at-Taubah: 119), further in another surah, namely "Woe to
those who deceive, namely those who measure others, asking that they be filled. And when
they measure or weigh others, they subtract. Rise from the dead on the great day, which is the
day when man will stand before the Lord of the worlds (Al-Muthaffifin 1-6). From these
verses emphasize the need for honesty and fairness during the negotiation process regardless
of who is transacting and Allah forbids lying, cheating, manipulating and gambling firmly
because it causes unprofitability in this world and the hereafter. An honest attitude is shown
in the picture of honesty and thoroughness, including in terms of punctuality, promises,
services, reporting, giving recognition if weaknesses and shortcomings to continue to be
improved, and refraining from lies and deception against oneself, coworkers, companies and
partners.
Amanah is a behavior that should be mandatory in all Muslims who describe accountability
when fulfilling their obligations and responsibilities. Amanah is proven by transparency,
honesty, good service and virtuous (good), especially for those who have jobs related to
serving the community. It is also mentioned in Surah An-Nisaa that "Verily Allah gives
orders to those who deserve them and orders when you make rules among people, to decide
wisely." Verily Allah gives you the best teaching, Verily Allah is All-Hearing, All-Seeing."
Responsibility and compliance with regulations or sharia. So that trustees must not
manipulate or deceive trust for the benefit of themselves, groups. Or groups that can harm
others.
Tabliqh means openness or transparency. Since ownership and business are multi-party,
transparency can be provided in the form of accounting for all transactions or keeping
accounts in line with Shariah principles. In the Qur'an, records are required in accordance
with surah: "O you who believe, when you do not pray with cash at the appointed time, write
it down and write it down among yourselves, and the recorder should not refuse to record it,
as Allah has taught, if he wishes to write it down, and fear the Lord your God, and do not let
the slightest mistake escape. If the debtor is feeble-minded or weak (according to the
constitution) or he cannot dictate himself, his guardian dictates truthfully and bears witness
with 2 male witnesses (among you), if 2 men are not available then one alone and 2 female
witnesses whom You are pleased with, so that if one forgets the other remembers (Al
Baqarah: 282). The verse explains that believers are obliged to record events that have
occurred and those that have not occurred. This record is not only to remember past
transactions, accompanied by authentic documents that prove these transactions, but also as a
basis for calculating the loss or profit of a period and the amount of funds held correctly and
fairly and responsibly. The news is not only necessary to evaluate the company's activities,
but also to convey a lot of news to the outside world.
Fathanah (Competence) is a quality that entrepreneurs must have, namely extensive
knowledge of Islamic business, many skills or the ability to capture the tastes of buyers of
goods and services. The Prophet gave an example of not taking profit excessive compared to
other traders. Feeling altruistic is a form of Fathanah attitude, which means not thinking of
one's own benefit. Therefore, the Fathanah character is very necessary for business people,
because this behavior is related to the development of professional skills or skills based on
good ethical values in the development and implementation of business development
schemes to improve the welfare of stakeholders and society. In contrast to traditional traders
who only focus on the welfare of shareholders.
Istiqamah is an action that always shows and implements these principles even in the face of
many seductions and obstacles. Potential business opportunities and many benefits are only
with istiqamah. Consistency (istiqamah) in wisdom is shown by earnestness, determination
and patience to achieve something to the maximum. Consistency is the result of a continuous
method, for example, a strong relationship with God in the form of prayer, dhikr, khatam Al-
Qur'an and so on. It promotes a system that allows kindness, honesty, and openness to find
peace while providing solutions and avenues for all problems.
Indeed, given that the elements of good corporate governance, as espoused by the Anglo-
Saxon and continental European schools, are all contained within Shari'i principles.
Therefore, GCG principles are very supportive of Sharia institutions because they are in
accordance with Sharia principles, for example: Fairness, Transparency, Accountability,
Accountability, Ethics, Commitment and Independence. Meanwhile, the principles of
Muamalah known in Islam, for example: Justice, Tazawun (Balance), Mas'uliyah
(Responsibility), Akhlaq (Morals), Shiddiq (Integrity), Amanah (Fulfilling Faith), Fathanah
(Intelligence), Tabligh (Openness), Hurriyah (Independence and Responsibility Freedom,
Empowerment), Ihsan (Professional), Wasathan (Justice), Ghirah (Sharia Militancy), Idara
(Governance), Manusia/Khilafah (Leadership), Akidah (Faith), Ijabiyah (Positive Thinking),
Raqabah (Transgression), Qira'ah and Islah (an event that will continue to learn and
improve).
So in the application of GCG, the Sharia model actually already exists, even Islam preceded
the birth of traditional GCG that exists today. This means that the elements of GCG are more
complete in Islam. In general, with traditional GCG there are differences in who should be
responsible, what the objectives are to achieve them, ownership and control.
Regarding the difference between the objectives of traditional good governance and Sharia
GCG, Sharia GCG also believes in Sharia Enterprise Theory (SET). SET equates here
between spiritual and material values. This means that Sharia GCG is not just about pursuing
a lot of material profit, but to achieve religious values. It is not the same as traditional GCG
or capitalist ideology, the benefit of which is to get a lot of benefits only in material form.
SET also equates between selfish and sympathetic values in Islamic law, manifested in the
form of worship in the form of zakat. This zakat can take the form of worship, which is
actually a way to purify oneself for those who have property when viewed spiritually,
meaning that by paying zakat the owner of the property is purified from greed, misery and
individualism.
In Islamic Sharia, property is seen as a trust (amanah) in which half of the entrusted property
is the right of others and the person is obliged to give the property to others in the form of
zakat according to Islamic rules (rahmatanlil'alam). . Not dissimilar to the widely accepted
principle of ownership in capitalist economics, which is full ownership.
Conclusions
Therefore, from this existing inequality it can be concluded that GCG Syariah is indeed
capable of being introduced in United States companies to shift the role of conventional GCG
used as long as these three inequalities of purpose, responsibility and ownership can be
eliminated. This means that all Sharia learning and laws must be followed precisely and well
(Sharia Compliance). Of course, that is quite a difficult path to follow and achieve, as the
way of implementation requires changes and new successes. The solution to this problem is
available. He prepared an analysis of Anglo-Saxon business administration from an Islamic
perspective. In this analysis, Yaya (2007) showed that some of the corporate governance
values of the Anglo-Saxon model are not the same as those found in Islamic teachings.
Therefore, his research concluded that Shariah-based institutions have their own set of rules
and governance due to the different values contained in Islamic teachings.
