Page 82 - FREN-C2021 PROCEEDINGS

ISLAMIC CORPORATE SOCIAL RESPONSIBILITY: AN OVERVIEW

1*
Sharifah Nazura Syed Noh Noor Azila Mohd Zaid, Yaasmin Farzana Abdul Karim
1 Faculty of Business and Management., Universiti Teknologi MARA, Cawangan Negeri Sembilan, Kampus Rembau.

* Corresponding author: nazura@uitm.edu.my

Abstract
In recent years, Corporate social responsibility (CSR) has grown increasingly essential. Therefore, the
term Islamic Corporate Social Responsibility (i-CSR) is also found in the literature, regarded by the
Islamic economy and finance. Islamic CSR is based on the principles of Shariah. The main objective
of this paper is to study the past review on Islamic Corporate Social responsibility (i-CSR), the
differences between Islamic and conventional CSR, and review the past study on i-CSR in financial
institutions. The study showed a difference in the principles of Islamic CSR versus the traditional
principles of social responsibility. The difference is that the principles of i-CSR include a higher
measure of application of ethical principles, which should result in moral and ethical economic
enlargement of society.

Keywords: Islamic Corporate Social Responsibility
Introduction
Islamic CSR is based on the Al Quran and Sunnah philosophy, which guides all aspects of life,
including CSR practices (Bahari and Yusuf 2014). The i-CSR framework includes the spiritual
concept as the core aspect in explaining organizations involvement in social responsibility relating to
their obligation to Allah. The dimensions of i-CSR use the existing four key dimensions, which
comprised of Community, Workplace, Marketplace, and Environment since these dimensions are in
line with the spirit of Islam, to categorize CSR practises of Islamic organizations (Darus, Yusoff and
Azhari, 2013; Yusuf and Bahari, 2011). This paper highlights the overview of Islamic Corporate
Social Responsibility based on previous literature and the i-CSR Model. This paper is structured as
follows. In the literature review, present a brief review on the definition of i-CSR and outline the
differences between Islamic and conventional corporate social responsibility. The final section
presents previous literature on the study of i-CSR in financial institutions.

Previous Literature
Islamic Corporate Social responsibility
According to the definition provided by Dusuki (2009), i-CSR has a broader sense that includes the
taqwa (God-consciousness) component, in which companies, as groups of people, assume the
positions and obligations of servants and vicegerents in all circumstances. The term i-CSR is
generally understood to mean a relationship of the person towards God and his fellow servants that
could lead to success in life and achieve al Falah. It is not limited to profit maximization and company
sustainability but also includes the belief in doing good deeds for the sake of everlasting life (Bukhari,
2020). The recent study also has proposed a model and framework of i-CSR. According to Khurshid
(2014), in developing the i-CSR Model, this study had extended the theory of Carroll (1979) using an
operational definition of CSR that encompasses Islamic economic responsibility, Islamic legal
responsibility, Islamic ethical responsibility and Islamic philanthropic responsibility. Besides that,
Darus et al. (2013) proposed an Islamic CSR (i-CSR) conceptual framework that will align Islamic
organizations' CSR policies and practices with the principles and values of Islam. This segregation of
CSR practices is based on the different levels of protection to preserve faith, life, intellect, posterity,
and wealth. Carroll (1979) has proposed the typology of CSR that includes the following components:

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