Enhancing accountability in the Islamic capital market: assessing zakat disclosure practices of sharīʿah-compliant public listed companies in Malaysia
The dual structure of Malaysia’s capital market offers investors both sharīʿah-compliant and conventional investment options, creating expectations for Islamic accountability among sharīʿah-compliant public listed companies (PLCs). Drawing on the Institutional Theory, this study contended that stake...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | en |
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Accounting Research Institute (ARI) and UiTM Press, Universiti Teknologi MARA
2025
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| Subjects: | |
| Online Access: | https://ir.uitm.edu.my/id/eprint/130446/1/130446.pdf https://ir.uitm.edu.my/id/eprint/130446/ https://apmaj.uitm.edu.my/ |
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| Summary: | The dual structure of Malaysia’s capital market offers investors both sharīʿah-compliant and conventional investment options, creating expectations for Islamic accountability among sharīʿah-compliant public listed companies (PLCs). Drawing on the Institutional Theory, this study contended that stakeholders’ pressures act as a form of coercion, shaping corporate behaviour in relation to zakat disclosure, a fundamental component of Islamic social responsibility. Using a comprehensive zakat disclosure index (ZDI), this study assessed the extent of zakat disclosure among 160 sharīʿah-compliant PLCs for the financial year 2023. The findings revealed that disclosure levels remained critically low, with 83.1% of sharīʿah-compliant PLCs disclosing no zakat-related information and the majority scoring below 50%, reflecting weak institutional pressures and limited internal governance mechanisms. Sectoral differences were pronounced, with the financial services sector demonstrating stronger compliance due to higher regulatory expectations, while most other sectors lagged significantly. Overall, the results highlighted a substantial gap between sharīʿah-compliant status and substantive Islamic accountability, suggesting the need to institutionalise zakat disclosure as part of transparent, responsible, and socially aligned corporate practice. |
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