Initiating the Concept of Ihsan into Shari’ah’s Corporate Social Responsibility

Abstract

Objective – The objective of this study is to propose the implementation of the concept of ihsan into a company’s Shari’ah Corporate Social Responsibility (CSR). Methodology/Technique – Ihsan, as a concept in Islam, can be assessed from sev eral approaches i.e., normative approach, theoretical approach, and empirical approach. A Company’s CSR activities aim to provide welfare to stakeholders but many theories propose different points of view. The entity theory argues that stakeholders are the shareholders only while the enterprise theory holds a broader view suggesting that stakeholder are not only the shareholders but that other stakeholders are involved. Meanwhile, the S hari'ah’s enterprise theory states that stakeholders include God, human, and nature. The difference existing among these theories motivate every company to implement the CSR activities based on the concept of ihsan. Findings – Results of this study show that the implementation of the concept of ihsan into the Shari’ah’s CSR could provide the Shari'ah added value. Novelty – This study contends that the CSR is not only to improve the reputati on of the company but also to worship God via the concept of ihsan.