WHY HUMAN GOVERNANCE IS NEEDED

HUMAN governance is about being a good human being. This letter expounds human governance from the context of Islamic banking.

According to Accountants Today (2009), human governance is an internal mechanism to guide human behaviour.

The target object for human governance is the human being since the soul of the corporation is human.

As the soul of the banks, the employees, as dedicated and sincere workers, must work towards meeting the goals of the banks for mardhatillah (blessings of God).

From the Islamic worldview, one’s soul is a key axis for human governance.

Unlike corporate governance, human governance deals with human behaviour that is inspired by sound intentions, guided by the Islamic worldview and Islamic business philosophy.

Human governance advocates good deeds, where God-fearing men and women walk down the right pathway. The consequence of such a human governance is a truthful person free of toxic behaviours and malpractices.

Why Islamic banks need human governance?

FIRSTLY, human governance is aimed at upholding maqasid alShariah (objectives of syariah) to promote qalb-based leadership — a leadership where the soul is considered in all the decisions of the individual for the benefit of the ummah or humanity in general.

Qalb essentially means soul. SECONDLY, human governance improves the individuals’ productivity as every deed is defined as ibadah (religious service). The employees work efficiently and ethically as God is watching them.

THIRDLY, human governance is a device that ensures shareholders and stakeholders work together, paving the way for an Islamic banking operation consistent with the expectations of all.

It can be said that the human governance paradigm is still at the infancy stage in the banking industry and more effort is needed to make it accessible and manageable.

Banks that offer financial products are typically driven by commercial objectives per se at the expense of social welfare objective. In turn, this leads to unethical practices that mar the public image of the industry.

Having said that, the best way to curb unethical practices is by inculcating human governance in staff by providing personalised training.

This is to ensure that every single employee sees his or her work as ibadah. All in, it helps to indoctrinate the qalb-based leadership, where integrity and faith matter. Labuan Faculty of International Finance, Universiti Malaysia Sabah, Labuan International Campus