Skip to main content
SpringerLink
Log in

Social Reporting of Egyptian Islamic Banks: Insights from the Post-Revolution Era

  • Chapter
  • First Online:
Financing Sustainable Development

Part of the book series: Palgrave Studies in Impact Finance ((SIF))

Abstract

This chapter presents a case study exploring the social reporting practices of Egyptian Islamic banks (IBs) following two revolutions in Egypt. The two Egyptian Arab uprisings in 2011 and 2013 threatened the social legitimacy of IBs. Thus, this study aims at investigating the social reporting strategies employed by Egyptian IBs to defend their social legitimacy following two uprisings. The case is framed within legitimacy theory, arising from the notion of a “social contract” between company and society. It adopts content analysis of annual reports and websites, and interviews with different stakeholders, to explore motivations for social reporting in the new era. The findings reveal that Egyptian IBs used different communication strategies to legitimise themselves after the two uprisings; however, they failed to do so. This research concludes with different implications for policy makers in IBs in Egypt and Arab Spring countries.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 129.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 169.00
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 169.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    Social welfare is promoted through Zakat. It is collected from Muslim individuals and businesses to be paid to the poor and the needy, to enhance community welfare. It is basically a redistribution of wealth (Lewis 2001).

References

  • Abdel-Razik, M. (2014). The Association Between Corporate Social Responsibility Disclosure and Corporate Governance - A Survey of Egypt. Research Journal of Finance and Accounting, 5, 93–98.

    Google Scholar 

  • Abdelsalam, O., & Weetman, P. (2003). International Accounting Standards to an Emerging Capital Market: Relative Familiarity and Language Effect in Egypt. Journal of International Accounting, Auditing and Taxation, 12, 63–84.

    Article  Google Scholar 

  • Abdelsalam, O., El-Masry, A., & Segini, S. (2008). Board Composition, Ownership Structure and Dividend Policies in an Emerging Market. Managerial Finance, 34(12), 953–964.

    Article  Google Scholar 

  • Abdelsalam, O., Fethi, M., Matallin, J., & Ausina, E. (2014). On the Comparative Performance of Socially Responsible and Islamic Mutual Funds. Journal of Economic Behavior and Organisation, 103, 108–128.

    Article  Google Scholar 

  • Abumustafa, N. (2017). Investigating the Arab Stock Markets During Arab Spring. Journal of Asset Management, 5, 313–318.

    Google Scholar 

  • Adams, C., Coutts, A., & Harte, G. (1995). Corporate Equal Opportunities (Non) Disclosure. The British Accounting Review, 27(2), 87–108.

    Article  Google Scholar 

  • ADIB Egypt. (2016). Abu Dhabi Islamic Bank of Egypt Annual Report 2016. Abu Dhabi Islamic Bank of Egypt, Cairo.

    Google Scholar 

  • African Development Bank. (2014). Islamic Banking and Finance in North Africa: Past Development and Future Potential. Abidjan, Cote D’lvoire: African Development Bank.

    Google Scholar 

  • Aggarwal, R., & Yousef, T. (2000). Islamic Banking and Investment Financing. Journal of Money, Credit, and Banking, 32, 93–120.

    Article  Google Scholar 

  • Al-Attas, S. (1996). The Worldview of Islam: An Outline. In S. Al-Attas’s (Ed.), Islam and The Challenge of Modernity. Kuala Lumpur: International Institute of Islamic Thought and Civilization.

    Google Scholar 

  • Al Baraka. (2016). Al Baraka Bank Annual Report 2016. Al Baraka Bank Egypt, Cairo, Egypt.

    Google Scholar 

  • Aribi, Z., & Arun, T. (2015). Corporate Social Responsibility and Islamic Financial Institutions (IFIs): Management Perceptions from IFIs in Bahrain. Journal of Business Ethics, 129, 785–804.

    Article  Google Scholar 

  • Aribi, Z., & Gao, S. (2010). Corporate Social Responsibility Disclosure: A Comparison between Islamic and Conventional Financial Institutions. Journal of Financial Reporting and Accounting, 8, 79–91.

    Google Scholar 

  • Aribi, Z., & Gao, S. (2011). Narrative Disclosure of Corporate Social Responsibility in Islamic Financial Institutions. Managerial Auditing Journal, 27, 199–222.

    Article  Google Scholar 

  • Avia, J. (2013). The Evolution of Corporate Social Responsibility (CSR) in the Arab Spring. The Middle East Journal, 67, 77–92.

    Google Scholar 

  • Bank Misr. (2016). Bank Misr Annual Report 2016. Bank Misr, Cairo, Egypt.

    Google Scholar 

  • Beattie, V., & Thomson, S. (2007). Lifting the Lid on the Use of Content Analysis to Investigate Intellectual Capital Disclosures. Accounting Forum, 31, 129–163.

    Article  Google Scholar 

  • Beekun, R., & Badawi, J. (2005). Balancing Ethical Responsibility among Multiple Organisational Stakeholders: The Islamic Perspective. Journal of Business Ethics, 60(2), 131–145.

    Article  Google Scholar 

  • Belal, A., & Owen, D. (2007). The Views of Corporate Managers on the Current State of, and Future Prospects for, Social Reporting in Bangladesh: An Engagement-Based Study. Accounting, Auditing and Accountability Journal, 20(3), 472–494.

    Article  Google Scholar 

  • Belal, A., Abdelsalam, O., & Nizamee, S. (2015). Ethical Reporting in Islamic Bank Bangladesh Limited (1983–2010). Journal of Business Ethics, 129, 769–784.

    Article  Google Scholar 

  • Ben Khediri, K., Charfeddine, L., & Ben Youssef, S. (2015). Islamic Versus Conventional Banks in the GCC: A Comparative Study Using Clarification Techniques. Research in International Business and Finance, 33, 75–98.

    Article  Google Scholar 

  • Blacconiere, W., & Patten, D. (1994). Environmental Disclosures, Regulatory Costs, and Change in Firm Value. Journal of Accounting and Economics, 18(3), 357–377.

    Article  Google Scholar 

  • Brennan, N. (2001). Reporting Intellectual Capital in Annual Reports: Evidence from Ireland. Accounting, Auditing and Accountability Journal, 14, 423–436.

    Article  Google Scholar 

  • Burns, J. (2014). The Islamic Banking Sector in Post-Revolution Egypt: Is Islam the Solution? Banking & Finance Law Review, 29, 319–352.

    Google Scholar 

  • Campbell, D. (2004). A Longitudinal and Cross-Sectional Analysis of Environmental Disclosure in UK Companies: A Research Note. The British Accounting Review, 36, 107–117.

    Article  Google Scholar 

  • Central Bank of Egypt. (2010). Central Bank of Egypt. Retrieved from http://www.cbe.org.eg/ar/Pages/default.aspx.

  • Chapra, U. (1992). Islam and the Economic Challenge. Leicester: The Islamic Foundation.

    Google Scholar 

  • Cho, C. (2009). Legitimation Strategies Used in Response to Environmental Disaster: A French Case Study of Total SA’s Erika and AZF Incidents. European Accounting Review, 18, 33–62.

    Article  Google Scholar 

  • Corruption Perception Index. (2010). Corruption Perception Index. Retrieved from https://www.transparency.org/cpi2010.

  • Dahawy, K., Merino, B., & Conovor, T. (2002). The Conflict between IAS Disclosure Requirements and Secretive Culture in Egypt. Advances in International Accounting, 15, 203–228.

    Article  Google Scholar 

  • Dar, H., & Presely, R. (2000). Lack of Profit Loss Sharing in Islamic Banking: Management and Control Imbalances. International Journal of Islamic Financial Services, 2, 2–18.

    Google Scholar 

  • Deegan, C. (2002). The Legitimising Effect of Social and Environmental Disclosures - A Theoretical Foundation. Accounting, Auditing and Accountability Journal, 15, 282–311.

    Article  Google Scholar 

  • Deegan, C. (2014). An Overview of Legitimacy Theory as Applied within the Social and Environmental Accounting Literature. In J. Bebbington, J. Unerman, & B. O’Dwyer (Eds.), Sustainability, Accounting and Accountability. London: Routledge.

    Google Scholar 

  • Deegan, C., & Bloomquist, C. (2006). Stakeholder Influence on Corporate Reporting: An Exploration of the Interaction between WWF-Australia and the Australian Minerals Industry. Accounting, Organisations and Society, 31, 343–372.

    Article  Google Scholar 

  • Deegan, C., & Gordon, B. (1996). A Study of the Environmental Disclosure Practices of Australian Corporations. Accounting and Business Research, 26, 187–199.

    Article  Google Scholar 

  • Deegan, C., & Rankin, M. (1996). Do Australian Companies Report Environmental News Objectively? An Analysis of Environmental Disclosures by Firms Prosecuted Successfully by the Environmental Protection Authority. Accounting, Auditing and Accountability Journal, 9, 52–69.

    Article  Google Scholar 

  • Deegan, C., & Unerman, J. (2011). Financial Accounting Theory. New York: McGraw Hill Education.

    Google Scholar 

  • Deegan, C., Rankin, M., & Voght, P. (2000). Firm’s Disclosure Reactions to Major Social Incidents: Australian Evidence. Accounting Forum, 24, 100–130.

    Article  Google Scholar 

  • Donaldson, T., & Preston, L. (1995). Stakeholder Theory of the Corporation: Concepts, Evidence, and Implications. Academy of Management Review, 20(1), 65–92.

    Article  Google Scholar 

  • Dowling, J., & Pfeffer, J. (1975). Organisational Legitimacy: Social Values and Organizational Behavior. Pacific Sociological Review, 18, 122–136.

    Article  Google Scholar 

  • Dusuki, A., & Abdullah, N. (2007). Why Do Malaysian Customers Patronise Islamic Banks? International Journal of Bank Marketin, 25, 142–160.

    Article  Google Scholar 

  • Egyptian Constitution. (2014). Egyptian Constitution. Egyptian Presidency, Cairo, Egypt.

    Google Scholar 

  • Egypt National Review Report. (2016). Egypt National Review Report: For Input to the 2016 HLPE. Cairo, Egypt: The Ministry of International Cooperation.

    Google Scholar 

  • Egypt Vision 2030. (2018). Egypt Vision 2030. Retrieved from www.sdsegypt2030.com.

  • El-Halaby, S., & Hussainey, K. (2015). The Determinants of Social Accountability Disclosure: Evidence from Islamic Banks Around the World. International Journal of Business, 20, 202–223.

    Google Scholar 

  • Elmassri, M., Harris, E., & Carter, D. (2016). Accounting For Strategic Invesement Decision Making Under Extreme Uncertainty. The British Accounting Review, 48, 151–168.

    Article  Google Scholar 

  • Elshabasy, Y. (2017). The Impact of Corporate Characteristics on Environmental Information Disclosure: An Empirical Study on Listed Firms in Egypt. The Business and Management Review, 8, 181–191.

    Google Scholar 

  • Faisal Islamic Bank of Egypt. (2016). Faisal Islamic Bank of Egypt Annual Report. Cairo: Faisal Islamic Bank of Egypt.

    Google Scholar 

  • Farook, S., Hassan, M., & Lanis, R. (2011). Determinants of Corporate Social Responsibility Disclosure: The Case of Islamic Banks. Journal of Islamic Accounting and Business Research, 2, 114–141.

    Article  Google Scholar 

  • Gillham, B. (2000). Research Interviews. London: Continuum International.

    Google Scholar 

  • Gray, R., Kouhy, R., & Lavers, S. (1995). Corporate Social and Environmental Reporting: A Review of Literature and a Longitudinal Study of UK Disclosure. Accounting, Auditing and Accountability Journal, 8, 47–77.

    Article  Google Scholar 

  • Guthrie, J., & Parker, L. (1990). Corporate Social Disclosure Practice: A Comparative International Analysis. Advances in Public Interest Accounting, 3, 251–176.

    Google Scholar 

  • Haniffa, R., & Hudaib, M. (2007). Exploring the Ethical Identity of Islamic Banks Via Communication in Annual Reports. Journal of Business Ethics, 76, 97–116.

    Article  Google Scholar 

  • Hassan, A., & Harahap, S. (2010). Exploring Corporate Social Responsibility Disclosure: The Case of Islamic Banks. International Journal of Islamic and Middle Eastern Finance and Management, 3, 203–227.

    Article  Google Scholar 

  • Hassan, O., & Marston, C. (2010). Disclosure Measurement in the Empirical Accounting Literature: A Review Article. Working Paper, University of Brunel, UK, pp. 1–58.

    Google Scholar 

  • Hussainey, K., Elsayed, M., & Abdel-Razik, M. (2011). Factors Affecting Corporate Social Responsibility Disclosure in Egypt. Corporate Ownership and Control, 8, 432–443.

    Article  Google Scholar 

  • Jamali, D., Sidani, Y., & El-Asmar, K. (2009). A Three Country Comparative Analysis of Managerial CSR Perspectives: Insights from Lebanon, Syria, and Jordan. Journal of Business Ethics, 85, 173–192.

    Article  Google Scholar 

  • Kamla, R. (2007). Critically Appreciating Social Accounting and Reporting in the Arab Middle East: A Postcolonial Perspective. Advances in International Accounting, 20, 105–177.

    Article  Google Scholar 

  • Kamla, R. (2009). Critical Insights into Contemporary Islamic Accounting. Critical Perspectives on Accounting, 20, 921–932.

    Article  Google Scholar 

  • Kamla, R., & Rammal, H. (2013). Social Reporting by Islamic Banks: Does Social Justice Matter? Accounting, Auditing and Accountability Journal, 26, 911–945.

    Article  Google Scholar 

  • Kamla, R., Gallhofer, S., & Haslam, J. (2012). Understanding Syrian Accountants’ Perceptions of and Attitudes Towards Social Accounting. Accounting, Auditing and Accountability Journal, 25, 1170–1205.

    Article  Google Scholar 

  • Karim, R. (1990). The Independence of Religious and External Auditors in Islamic Banks. Accounting, Auditing and Accountability Journal, 3, 34–43.

    Google Scholar 

  • Khan, M. (2013). Developing a Conceptual Framework to Appraise the Corporate Social Responsibility Performance of Islamic Banking and Finance Institutions. Accounting and the Public Interest, 13, 191–207.

    Article  Google Scholar 

  • Krippendorff, K. (2004). Content Analysis: An Introduction to Its Methodology. London: Sage Publication Ltd.

    Google Scholar 

  • Kvale, S. (1996). Interviews: An Introduction to Qualitative Research Interviewing. California: Sage Publications.

    Google Scholar 

  • Lewis, M. (2001). Islam and Accounting. Accounting Forum, 25, 103–127.

    Article  Google Scholar 

  • Lindblom, C. (1994). The Implications of Organisational Legitimacy for Corporate Social Performance and Disclosure. Critical Perspectives on Accounting Conference, New York.

    Google Scholar 

  • Maali, B., Casson, P., & Napier, C. (2006). Social Reporting by Islamic Banks. Abacus, 42, 266–289.

    Article  Google Scholar 

  • Megeid, N. (2013). The Impact of Service Quality on Financial Performance and Corporate Social Responsibility: Conventional versus Islamic Banks in Egypt. International Journal of Finance and Accounting, 2, 150–163.

    Google Scholar 

  • Ministry of Social Solidarity. (2018). The Ministry of Social Solidarity. Retrieved December 12, 2018, from http://www.moss.gov.eg.

  • Noronha, C., Leung, T., & Lei, O. (2015). Corporate Social Responsibility Disclosure in Chinese Railway Companies: Corporate Response after a Major Train Accident. Sustainability Accounting, Management and Policy Journal, 6, 446–474.

    Article  Google Scholar 

  • O’Donovan, G. (2002). Environmental Disclosures in the Annual Report: Extending the Applicability and Predictive Power of Legitimacy Theory. Accounting, Auditing and Accountability Journal, 15, 344–371.

    Article  Google Scholar 

  • Osman, M. (2013). Corporate Social Responsibility (CSR) Reporting of Egyptian Banks: Critical and Postcolonial Perspective. PhD Thesis, Queen Mary University of London.

    Google Scholar 

  • Patten, D., & Crampton, W. (2004). Legitimacy and the Internet: An Examination of Corporate Web Page Environmental Disclosures. Advances in Environmental Accounting & Management, 2, 31–57.

    Article  Google Scholar 

  • Rice, G. (1999). Islamic Ethics and the Implications for Business. Journal of Business Ethics, 18, 345–358.

    Article  Google Scholar 

  • Richardson, P., Anderson, A., & Bang, H. (2002). Sustainability Reporting on the Internet: A Study of Global Fortune 500. Greener Management International, 40(Winter), 57–75.

    Article  Google Scholar 

  • Rizk, R., Dixon, R., & Woodhead, A. (2008). Corporate Social and Environmental Reporting: A Survey of Disclosure Practices in Egypt. Social Responsibility Journal, 4, 306–323.

    Article  Google Scholar 

  • ROSC. (2009). Report on the Observance of Standards and Codes - The Arab Republic of Egypt. Cairo: The World Bank.

    Google Scholar 

  • Salamey, I. (2015). Post-Arab Spring: Changes and Challenges. Third World Quarterly, 36, 111–129.

    Article  Google Scholar 

  • Samaha, K., & Dahawy, K. (2010). Factors Influencing Corporate Disclosure Transparency in the Active Share Trading Firms: An Exploratory Study. Research in Accounting in Emerging Economies, 10, 87–118.

    Article  Google Scholar 

  • Schadewitz, H., & Kanto, A. (2002). The Impact of Disclosure on the Market Response to Reported Earnings. Scandinavian Journal of Management, 18, 521–542.

    Article  Google Scholar 

  • Scholtens, B. (2009). Corporate Social Responsibility in the International Banking Industry. Journal of Business Ethics, 86, 159–175.

    Article  Google Scholar 

  • Shocker, A., & Sethi, S. (1973). An Approach to Incorporating Societal Preferences in Developing Corporate Action Strategies. California Management Review, 15, 97–105.

    Article  Google Scholar 

  • Siddiqui, A. (1997). Ethics in Islam: Key Concepts and Contemporary Challenges. Journal of Moral Education, 26, 423–431.

    Article  Google Scholar 

  • Sobhy, H. (2015). Secular Facade, Neoliberal Islamisation: Textbook Nationalism from Mubarark to Sisi. Nations and Nationalism, 21(2), 802–824.

    Google Scholar 

  • Soliman, M., El Din, M., & Sakr, A. (2012). Ownership Structure and Corporate Social Responsibility (CSR): An Empirical Study of the Listed Companies in Egypt. The International Journal of Social Sciences, 15, 63–74.

    Google Scholar 

  • Ullah, S., & Jamali, D. (2010). Institutional Investors and Corporate Social Responsibility: The Role of Islamic Financial Institutions. International Review of Business Research Papers, 6, 619–630.

    Google Scholar 

  • Ullah, S., Jamali, D., & Harwood, I. (2014). Socially Responsible Investment: Insights from Sharia Departments in Islamic Financial Institutions. Business Ethics: A European Review, 23, 218–233.

    Article  Google Scholar 

  • Ullah, S., Harwood, I., & Jamali, D. (2018). ‘Fatwa Repositioning’: The Hidden Struggle for Sharia Compliance within Islamic Financial Institutions. Journal of Business Ethics, 149, 895–917.

    Article  Google Scholar 

  • UNDP. (2016). Expanding Horizons in Development: The Rising Role of Private Sector. Cairo: UNDP & Industrial Moderation Centre.

    Google Scholar 

  • Walden, W., & Schwartz, B. (1997). Environmental Disclosures and Public Policy Pressure. Journal of Accounting and Public Policy, 16, 125–154.

    Article  Google Scholar 

  • Wafa, D. (2015). Arab Spring Impact on Executive Education. International Journal of Education Management., 29(5), 596–608.

    Google Scholar 

  • Warde, I. (2013). Islamic Finance in the Global Economy. Dubai: CFA Institute Middle East Investment Conference.

    Google Scholar 

  • Williams, S., & Pei, C. (1999). Corporate Social Disclosures by Listed Companies on Their Websites: An International Comparison. The International Journal of Accounting, 34, 389–419.

    Article  Google Scholar 

  • Wilmshurst, T., & Frost, G. (2000). Corporate Environmental Reporting: A Test of Legitimacy. Accounting, Auditing, and Accountability Journal, 13, 10–26.

    Article  Google Scholar 

  • Zinkin, J. (2007). Islam and CSR: A Study of the Compatibility between the Tenets of Islam, the UN Global Compact and the Development of Social, Human, and Natural Capital. Corporate Social Responsibility and Environmental Management, 14, 206–218.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. University of Aberdeen Business School, Aberdeen, UK

    Mohamed Nagy Osman

  2. Faculty of Commerce, Benha University, Egypt

    Mohamed Nagy Osman

Authors
  1. Mohamed Nagy Osman
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Mohamed Nagy Osman .

Editor information

Editors and Affiliations

  1. Faculty of Economics and Management, University of Szczecin, Szczecin, Poland

    Magdalena Ziolo

  2. Davis Center for Russian and Eurasian Studies, Harvard University, Cambridge, MA, USA

    Bruno S. Sergi

Appendix

Appendix

Table 14.2 Contextual information on the study population
Full size table
Table 14.3 Stakeholders of Egyptian Islamic banks
Full size table

Rights and permissions

Reprints and permissions

Copyright information

© 2019 The Author(s)

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Osman, M.N. (2019). Social Reporting of Egyptian Islamic Banks: Insights from the Post-Revolution Era. In: Ziolo, M., Sergi, B.S. (eds) Financing Sustainable Development. Palgrave Studies in Impact Finance. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-16522-2_14

Download citation

  • DOI: https://doi.org/10.1007/978-3-030-16522-2_14

  • Published:

  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-030-16521-5

  • Online ISBN: 978-3-030-16522-2

  • eBook Packages: Economics and FinanceEconomics and Finance (R0)

Publish with us

Policies and ethics

Search

Navigation