Corporate Social Responsibility and Related Social Reporting: The Case of Saudi Arabian Islamic Banks

Islamic banking is understood to have an ethical identity that is concerned about social welfare and justice. However, Islamic banks (IBs) have been facing major criticism in regard to their social impact and ethics in practice and any related social reporting. Several commentators have labelled this phenomenon as the social failure of IBs. This research aims critically to assess corporate social responsibility (CSR) and the related reporting practices by employing two qualitative methods. The focus is on assessing the reflection of the Islamic worldview, or the absence thereof, by IBs, with specific reference to the dual-banking sector of Saudi Arabia. The thesis adopts a postcolonial perspective to study the phenomenon in a context that has never experienced physical colonialism. The thesis finds that the perception of CSR is largely influenced by Western conceptualisation and manifestation. Further, the thesis identifies several factors related to globalisation and the dual-banking system, which seem to influence IBs and their CSR. Those factors seem to be obstacles to potentially authentic conduct. Furthermore, the thesis found that the Sharia supervisory boards (SSBs) are tasked with Islamising Western banking conduct, which results in the SSBs completely overlooking any non-financial issues, including CSR. This research contributes to the critical field of Islamic, economic-related studies and Islamic accounting, which appears to suffer from a dearth of studies (Kamla, 2009; Kuran, 2004). By incorporating several aspects that are largely neglected in the literature, such as the dual-banking system, globalisation and SSBs with reference to CSR, the research provides rich insights into a context that is characterised by Islam and an openness to the globe.