Factors Strengthening the Fundamental Concept of Human Relations in Islamic Financial Institutions of Indonesia

Budi Sukardi -  Faculty of Islamic Economics and Business, Universitas Islam Negeri Raden Mas Said Surakarta, Indonesia
Fachrurazi Fachrurazi* -  Faculty of Islamic Economics and Business, Institut Agama Islam Negeri Pontianak, Indonesia
Eko Asmanto -  Faculty of Islamic Religion, University of Muhammadiyah Sidoarjo, Indonesia
DOI : 10.22515/shirkah.v7i1.464

This study seeks to manifest the factors in strengthening and improving the fundamental concepts of human relations in Islamic banking including motivation, concepts and perceptions of individuals, power, decision-making, communication, leadership, mentality, social environment, individual differences, and human dignity. They are scrutinized in Islamic financial institutions in Indonesia. This quantitative study employed a non-experimental approach. 38 Islamic financial institutions were involved as the representative sample. Data from the questionnaire were analyzed using factor analysis to reduce the data by summarizing several factors and renaming them as new factors. Verification using factor analysis with correlation matrix showed that the human dignity provides a significant relationship to all factors in human relations in Islam with a significance of < 0.05. All factors were found valid with the highest validity of 0.802 (human dignity). The results of the reduction factor brought up three new factors social, psychological, and leadership factors. This study proves that the essential components to strengthen and improve human relations in Islamic banking are implementing and improving social, psychological, and leadership aspects.

Keywords : Fundamental Concept of Human Relations in Islam; Islamic Financial Institutions (IFIs); Islamic Banking

  1. Abdul-Baki, Z., & Uthman, A. B. (2017). Exploring the “social failures” of Islamic banks: A historical dialectics analysis. Journal of Islamic Accounting and Business Research, 8(3), 250–271. https://doi.org/10.1108/JIABR-06-2014-0021
  2. Ab. Wahab, M., & Masron, T. A. (2020). Towards a core Islamic work value. Journal of Islamic Accounting and Business Research, 11(1), 179–200. https://doi.org/10.1108/JIABR-11-2017-0158
  3. Aldulaimi, S. H. (2016). Fundamental Islamic perspective of work ethics. Journal of Islamic Accounting and Business Research, 7(1), 59–76. https://doi.org/10.1108/JIABR-02-2014-0006
  4. Alserhan, B. A. (2017). The principles of Islamic marketing. Routledge. https://doi.org/10.4324/9781351145688
  5. AlTayyar, A. A. M. (2017). Human relations in Islam. Academic Publishing and Press, King Saud University.
  6. Balmer, J. M. T. (2017). The corporate identity, total corporate communications, stakeholders’ attributed identities, identifications and behaviours continuum. European Journal of Marketing, 51(9), 1472–1502. https://doi.org/10.1108/EJM-07-2017-0448
  7. Brady, E., & Phemister, P. (2012). Human-environment relations. In E. Brady & P. Phemister (Eds.), Springer Netherlands. Springer Netherlands. https://doi.org/10.1007/978-94-007-2825-7
  8. Creswell, J. W. (2016). Research design: Pendekatan metode kualitatif, kuantitatif, dan campuran (4th ed.). Pustaka Pelajar.
  9. Creswell, J. W., & Creswell, J. D. (2018). Research design : qualitative, quantitative, and mixed methods approaches (Fifth, Issue July). SAGE Publications.
  10. Edwards, M. (2011). Introduction: Civil society and the geometry of human relations. In The Oxford Handbook of Civil Society. Oxford University Press. https://doi.org/10.1093/oxfordhb/9780195398571.013.0001
  11. Enciso, S., Milikin, C., & O’Rourke, J. S. (2017). Corporate culture and ethics: From words to actions. Journal of Business Strategy, 38(6), 69–79. https://doi.org/10.1108/JBS-01-2017-0001
  12. Garver, G. (2019). A systems-based tool for transitioning to law for a mutually enhancing human-earth relationship. Ecological Economics, 157(June), 165–174. https://doi.org/10.1016/j.ecolecon.2018.09.022
  13. Gheitani, A., Imani, S., Seyyedamiri, N., & Foroudi, P. (2019). Mediating effect of intrinsic motivation on the relationship between islamic work ethic, job satisfaction, and organizational commitment in banking sector. International Journal of Islamic and Middle Eastern Finance and Management, 12(1), 76–95. https://doi.org/10.1108/IMEFM-01-2018-0029
  14. Goyena, R. (2015). Social relations in human and societal development. In C. Psaltis, A. Gillespie, & A.-N. Perret-Clermont (Eds.), Palgrave Macmillan. Palgrave Macmillan UK. https://doi.org/10.1057/9781137400994
  15. Groep, S. van de, Meuwese, R., Zanolie, K., Güroğlu, B., & Crone, E. A. (2020). Developmental changes and individual differences in trust and reciprocity in adolescence. Journal of Research on Adolescence, 30(S1), 192–208. https://doi.org/10.1111/jora.12459
  16. Hahn, T., Pinkse, J., Preuss, L., & Figge, F. (2015). Tensions in corporate sustainability: Towards an integrative framework. Journal of Business Ethics, 127(2), 297–316. https://doi.org/10.1007/s10551-014-2047-5
  17. Hajali, A. R., Noordin, K., & Achour, M. (2018). The Islamic approach of obligations in mutual relations between employee and employer. International Journal of Ethics and Systems, 34(3), 338–351. https://doi.org/10.1108/IJOES-12-2017-0227
  18. Hassan, A., & Mollah, S. (2018). Islamic fnance. Springer International Publishing. https://doi.org/10.1007/978-3-319-91295-0
  19. Hassan, M. K., & Lewis, M. K. (2007). Handbook of Islamic banking. In Edward Elgar Publishing Limited. Edward Elgar Publishing, Inc.
  20. Husein, U. M. (2018). Islam, communication and accounting. Journal of Islamic Accounting and Business Research, 9(2), 138–154. https://doi.org/10.1108/JIABR-01-2016-0008
  21. Ioppolo, G., Cucurachi, S., Salomone, R., Saija, G., & Shi, L. (2016). Sustainable local development and environmental governance: A strategic planning experience. Sustainability, 8(2), 180. https://doi.org/10.3390/su8020180
  22. Iqbal, Z., & Mirakhor, A. (2017). Ethical dimensions of Islamic finance. Springer International Publishing. https://doi.org/10.1007/978-3-319-66390-6
  23. Ishii, A., Yomura, I., & Okano, N. (2020). Opinion dynamics including both trust and distrust in human relation for various network structure. 2020 International Conference on Technologies and Applications of Artificial Intelligence (TAAI), 131–135. https://doi.org/10.1109/TAAI51410.2020.00032
  24. Jacobsen, M. H. (2017). The interactionist imagination. Palgrave Macmillan. https://doi.org/10.1057/978-1-137-58184-6
  25. Kanani, I., Ahmadi Ramchahi, A., Zarasi, M., Zulkifli, M. Y., & Raja Yusof, R. J. (2017). The relationship of Muslims with non-Muslims based on the concept of Muwālāt (loyalty) in the Qurʾān. Humanomics, 33(3), 258–273. https://doi.org/10.1108/H-12-2016-0096
  26. Khalid, M., Bashir, S., Khan, A. K., & Abbas, N. (2018). When and how abusive supervision leads to knowledge hiding behaviors. Leadership & Organization Development Journal, 39(6), 794–806. https://doi.org/10.1108/LODJ-05-2017-0140
  27. Kitson, A., & Campbell, R. (1996). The ethical organisation. Macmillan Education UK. https://doi.org/10.1007/978-1-349-24405-8
  28. Kizilkaya, A. N., & Azid, T. (2017). Labor in an Islamic setting. Routledge. https://doi.org/10.4324/9781315591278
  29. Kovács, L., & Sütő, Á. (2020). On improving financial literacy. Economy & Finance, 7(1), 131–140. https://doi.org/10.33908/EF.2020.1.6
  30. Lerner, M. J., & Vermunt, R. (1991). Social justice in human relations (H. Steensma & R. Vermunt (eds.)). Springer US. https://doi.org/10.1007/978-1-4899-2629-6
  31. Macke, J., & Genari, D. (2019). Systematic literature review on sustainable human resource management. Journal of Cleaner Production, 208, 806–815. https://doi.org/10.1016/j.jclepro.2018.10.091
  32. Malik, A. (2018). Strategic human resource management and employment relations. Springer. Springer Singapore. https://doi.org/10.1007/978-981-13-0399-9
  33. Mertzanis, C. (2016). The absorption of financial services in an Islamic environment. Journal of Economic Behavior & Organization, 132, 216–236. https://doi.org/10.1016/j.jebo.2016.10.025
  34. Moghimi, S. M. (2018a). Individual differences: Personality in Islamic management. In Emerald Publishing Limited (Organizati, pp. 19–30). Emerald Publishing Limited page 19-30. https://doi.org/10.1108/978-1-78769-677-820181002
  35. Moghimi, S. M. (2018b). Leadership syles in Islamic management. In Organizational Behavior Management (pp. 159–220). Emerald Publishing Limited. https://doi.org/10.1108/978-1-78769-677-820181009
  36. Moghimi, S. M. (2018c). Motivation in Islamic management. In Organizational Behavior Management (pp. 41–65). Emerald Publishing Limited. https://doi.org/10.1108/978-1-78769-677-820181004
  37. Moghimi, S. M. (2018d). Organizational control in Islamic management. In Principles and Fundamentals of Islamic Management (pp. 235–266). Emerald Publishing Limited. https://doi.org/10.1108/978-1-78769-673-020181008
  38. Moghimi, S. M. (2018e). Organisational behavior management. Emerald Publishing Limited. https://doi.org/10.1108/9781787696778
  39. Moghimi, S. M. (2018f). Principles and fundamentals of Islamic management. Emerald Publishing Limited. https://doi.org/10.1108/9781787696730
  40. Murad, K. (2005). Inter personal relations an Islamic perspective (A. R. Siddiqui (ed.)). The Islamic Foundation.
  41. Mursi, A. H. (1997). SDM yang produktif: Pendekatan Al-Qur’an dan sains (Pertama). Gema Insani Press.
  42. Qadri, H. M.-D. (2019). Business ethics in Islam. Routledge. https://doi.org/10.4324/9780429326189
  43. Rahayu, A. R., Normah, O., Asheq, R., & Ruhaini, M. (2018). Islamic ethical values of corporate top leadership and real earnings management. International Journal of Law and Management, 60(3), 869–884. https://doi.org/10.1108/IJLMA-03-2017-0029
  44. Rana, M. H., & Malik, M. S. (2017). Impact of human resource (HR) practices on organisational performance. International Journal of Islamic and Middle Eastern Finance and Management, 10(2), 186–207. https://doi.org/10.1108/IMEFM-04-2016-0060
  45. Reece, B. L., Brandt, R., & Howie, K. F. (2011). Effective human relations: interpersonal and organisational applications. In South-Western Cengage Learning (Eleventh).
  46. Rofcanin, Y., & Anand, S. (2020). Human Relations Virtual Special Issue: Flexible Work Practices and Work-Family Domain. Human Relations, 73(8), 1182–1185. https://doi.org/10.1177/0018726720935778
  47. Syed, J., & Ali, A. J. (2010). Principles of employment relations in Islam: A normative view. Employee Relations, 32(5), 454–469. https://doi.org/10.1108/01425451011061630
  48. Tiby, A. M. El, & Grais, W. M. (2015). Islamic finance and economic development: Risk management, regulation and corporate governance. John Wiley & Sons.
  49. Warner, J. M. (2015). Rousseau and the problem of human relations. The Pennsylvania State University Press.
  50. Weatherburn, M. (2020). Human relations’ invented traditions: Sociotechnical research and worker motivation at the interwar rowntree cocoa works. Human Relations, 73(7), 899–923. https://doi.org/10.1177/0018726719846647
  51. White, K. W., & Chapman, E. N. (1996). Organisational communication: An introduction to communication and human relations strategies. In A Simon & Schuster Custom Publishing (1st ed.). Prentice-Hall.
  52. Zainuldin, M. H., Lui, T. K., & Yii, K. J. (2018). Principal-agent relationship issues in Islamic banks: A view of Islamic ethical system. International Journal of Islamic and Middle Eastern Finance and Management, 11(2), 297–311. https://doi.org/10.1108/IMEFM-08-2017-0212

Shirkah: Journal of Economics and Business
Published by Faculty of Islamic Economics and Business (FEBI)
Institut Agama Islam Negeri Surakarta, Indonesia
Jln. Pandawa No. 1, Pucangan, Kartasura, Central Java, Indonesia, 57168
Phone: +62271-781516
Website: http://shirkah.or.id/new-ojs/index.php/home
Email: shirkahiainsurakarta@gmail.com

P-ISSN :2503-4235 | E-ISSN : 2503-4243

This ejournal system and it's contents licensed under
a Creative Commons Attribution-NonCommercial 4.0 International License