ENHANCING THE ROLE OF STRATEGIC MANAGEMENT IN ADVANCING THE SUSTAINABILITY OF ISLAMIC FINANCIAL INSTITUTIONS
DOI:
https://doi.org/10.14421/jmd.2025.111.03Abstract
The increasing complexity of global economic competition and the rapid transformation of the financial industry present significant challenges to the sustainability of Islamic financial institutions. These challenges are further amplified by the necessity to align financial performance with ethical, social, and environmental responsibilities as mandated by the principles of maqasid al-shariah. Despite the growing discourse on sustainable finance, limited studies have integrated the domains of strategic management, sustainability, and Shariah compliance into a unified conceptual framework tailored to the specific context of Islamic financial institutions. This study aims to analyze and synthesize the role of strategic management in advancing sustainability within Islamic financial institutions, offering a comprehensive perspective that bridges theoretical insights and practical applications. The research adopts a literature review method, systematically examining and synthesizing relevant academic works, policy documents, and best practices from global and regional contexts. The findings indicate that embedding sustainability principles into the core of strategic management not only enhances institutional competitiveness and resilience but also strengthens public trust, expands financial inclusion, and ensures long-term socio-economic contributions. Furthermore, the study reveals that an integrated approach combining visionary strategic planning, adherence to maqasid al-shariah, and proactive adaptation to technological and regulatory changes serves as a robust foundation for sustainable growth. It is concluded that sustainability should be institutionalized as a strategic imperative, supported by clear performance indicators, capacity-building programs, and technology-driven innovations. The study recommends that Islamic financial institutions engage in constructive collaboration with regulators, industry associations, and stakeholders to foster an enabling ecosystem for inclusive and sustainable development. This conceptual synthesis not only contributes to the academic discourse but also provides actionable insights for policymakers and practitioners seeking to reinforce the long-term viability of Islamic financial institutions in the evolving global financial landscape.
Abstract viewed: 95 times
|
PDF downloaded = 69 times
References
Abdulmohsen, A. I. S. (2025). Corporate Governance and Micro-Banking Stability in Islamic Financial Institutions : Towards an Integrated Approach. Revue Française d’Economie et de Gestion, 6(8), 772–793.
Ahmad, M., Ahmed, Z., Alvarado, R., Hussain, N., & Khan, S. A. (2024). Financial development, resource richness, eco-innovation, and sustainable development: Does geopolitical risk matter? Journal of Environmental Management, 351(November 2023), 119824. https://doi.org/10.1016/j.jenvman.2023.119824
Akram Laldin, M., & Furqani, H. (2013). Developing Islamic finance in the framework of maqasid al-Shari’ah: Understanding the ends (maqasid) and the means (wasa’il). International Journal of Islamic and Middle Eastern Finance and Management, 6(4), 278–289. https://doi.org/10.1108/IMEFM-05-2013-0057
Alharbi, I. B. (2024). Strategic Management: a Comprehensive Review Paper. International Journal of Professional Business Review, 9(3), e04373. https://doi.org/10.26668/businessreview/2024.v9i3.4373
Alkhodary, D. (2023). Integración de la sosteniblidad en la gestión estratégica: un camino hacia el éxito empresarial a largo plazo. International Journal of Professional Business Review, 8(4), 1–32.
Asyiqin, I. Z. (2025). Islamic Economic Law in the Digital Age: Navigating Global Challenges and Legal Adaptations. Media Iuris, 8(1), 95–112. https://doi.org/10.20473/mi.v8i1.61800
Awalia, R., Kristanti, F. T., & Salim, D. F. (2024). The Influence of Financial Technology on Banking Financial Stability. International Journal of Religion, 5(11), 6640–6650. https://doi.org/10.61707/1kb67b37
Bowen, G. A. (2009). Document analysis as a qualitative research method. Qualitative Research Journal, 9(2), 27–40. https://doi.org/10.3316/QRJ0902027
Fitria, T. N. (2025). Islamic Banking Digitalization: Challenges and Opportunities in the Era of Industrial Revolution 4.0. JIEI: Jurnal Ilmiah Ekonomi Islam, 11(1), 1–19.
Gunawan, W. Ben, & Mikhail, L. (2025). Strategic and sustainable human resource management: Twin weapon for achieving competitive advantage in organization. Priviet Social Sciences Journal, 5(6), 45–58. https://doi.org/10.55942/pssj.v5i6.401
Güney, N. (2024). Maqāsid al-Sharī‘a in Islamic Finance: A Critical Analysis of Modern Discourses. Religions, 15(1). https://doi.org/10.3390/rel15010114
Junaedi, A., Rafli, M., & Suratmoko, B. (2024). Strategic Management in Islamic Banking: The Role of Religiosity and Service Satisfaction in Shaping Customer Decisions. Journa of Enterpise and Development (JED), 6(3), 4–6.
Mahfudz, A. A., Ahmad, R. A., & Nafi, D. M. (2024). Integrating Islamic Finance Principles and The Digital Disruptive Age to Support Global Sustainability. International Journal of Advanced Research in Economics and Finance. https://doi.org/10.55057/ijaref.2024.6.2.15
Mailani, D., Hulu, M. Z. T., Simamora, M. R., & Kesuma, S. A. (2024). Resource-Based View Theory to Achieve a Sustainable Competitive Advantage of the Firm: Systematic Literature Review. International Journal of Entrepreneurship and Sustainability Studies, 4(1), 1–15. https://doi.org/10.31098/ijeass.v4i1.2002
Mu, Z., Li, Y., & Hussain, H. (2024). Sustainability Beyond Profits: Assessing the Impact of Corporate Social Responsibility on Strategic Business Performance in Hospitality Small and Medium Enterprises. Sustainability (Switzerland), 16(23), 1–22. https://doi.org/10.3390/su162310224
Nasution, Z. S., & Lubis, I. (2025). The Role of Islamic Financial Institutions in Empowerment Sme’S in Indonesia. Islamic International Conference on Education, Communication, and Economics, 1(2), 75–86. https://doi.org/10.36769/ibest.v1i2.249
Nurcahyo, S. A., Ferdianto, R., & Arismaya, A. D. (2025). Toward Sustainable Islamic Banking : The Role of FinTech , Knowledge Management , Green Banking , and Sharia Compliance. Economica: Jurnal Ekonomi Islam, 16(1), 91–118. https://doi.org/10.21580/economica.2025.16.1.23752
Primadhany, E. F., Suttikornpadee, T., Maimunah, Amin, M., & Adawiyah, R. (2025). Sharia-Based Digital Economic Policies: A Maqasid Shariah Approach to Achieving Sustainable Development. Tribakti: Jurnal Pemikiran Keislaman, 36(1), 25–42. https://doi.org/10.33367/tribakti.v36i1.5485
Ramadhani, Y. C., & Budiarti, A. (2024). Innovative Strategy in Integrating Sharia Principles with Modern Business Practices. International Journal of Sharia Business Management, 3(1), 9–14.
Rodrigues, M., Alves, M. D. C., Oliveira, C., Vale, J., & Silva, R. (2021). The impact of strategy, environment, and the management system on the foreign subsidiary: The implication for open innovation. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 1–23. https://doi.org/10.3390/joitmc7010051
Sari, A. L. (2024). Strategic Management Practices and Their Impact on Organizational Performance: a Study of Smes in Emerging Markets. Komitmen: Jurnal Ilmiah Manajemen, 5(2), 48–55. https://doi.org/10.15575/jim.v5i2.38743
Sempiga, O., & Van Liedekerke, L. (2024). Investing in Sustainable Development Goals: Opportunities for Private and Public Institutions to Solve Wicked Problems That Characterize a VUCA World. IntechOpen. https://doi.org/10.5772/intechopen.110580
Shalhoob, H. (2025). ESG Disclosure and Financial Performance: Survey Evidence from Accounting and Islamic Finance. Sustainability (Switzerland), 17(4). https://doi.org/10.3390/su17041582
Shayan, N. F., Mohabbati-Kalejahi, N., Alavi, S., & Zahed, M. A. (2022). Sustainable Development Goals (SDGs) as a Framework for Corporate Social Responsibility (CSR). Sustainability (Switzerland), 14(3), 1–27. https://doi.org/10.3390/su14031222
Supriadi, I. (2025). Islamic financial inclusion and sustainability mindset : Pathways to MSME performance and SDG achievement. Alkasb: Journal of Islamic Economics, 4(June), 51–72.
Susanto, P. C., Yuntina, L., Saribanon, E., Panatap Soehaditama, J., & Liana, E. (2024). Qualitative Method Concepts: Literature Review, Focus Group Discussion, Ethnography and Grounded Theory. Siber Journal of Advanced Multidisciplinary, 2(2), 262–275. https://doi.org/10.38035/sjam.v2i2.207
Taufiq, A. (2025). The Role of Islamic Finance in Advancing Green Economic Development in Indonesia. Jurnal Ilmiah Ekonomi Islam, 11(1), 1–15. http://dx.doi.org/10.1016/j.bpj.2015.06.056%0Ahttps://academic.oup.com/bioinformatics/article-abstract/34/13/2201/4852827%0Ainternal-pdf://semisupervised-3254828305/semisupervised.ppt%0Ahttp://dx.doi.org/10.1016/j.str.2013.02.005%0Ahttp://dx.doi.org/10.10
Yarmanti A., V., Wissalam Bustami, A., & Muhammad Ardo, A. (2025). Islamic Banking Innovation and Customer Satisfaction: A Case Study of Indonesia and Nigeria. BANCO: Jurnal Manajemen Dan Perbankan Syariah, 7(1), 90–110. https://doi.org/10.35905/banco.v7i1.11018
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 JURNAL MANAJEMEN DAKWAH
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Authors who publish with Jurnal MD agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution-NonCommercial 4.0 International License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).
