Aljbour, Anas Mohammad, Xu, Lei, Wallace, Damien, and Yuan, Gordon (2025) Corporate social responsibility disclosure and dividend policy of Islamic banks: evidence from GCC countries. International Journal of Islamic and Middle Eastern Finance and Management. (In Press)

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Abstract

Purpose: This study explores the relationship between corporate social responsibility (CSR) disclosure and financial stability in Islamic banks, focusing on insolvency risk, liquidity risk, and credit risk.

Design/Methodology/Approach: The study examines 29 Islamic banks in the Gulf Cooperation Council (GCC) region from 2010 to 2022, constructing a comprehensive CSR index from annual report content.

Findings: The study finds a significant negative relationship between CSR disclosure and banks' insolvency risk and a significant positive relationship between CSR disclosure and banks' liquidity risk. A disaggregated analysis reveals that most individual dimensions positively influence insolvency risk. Conversely, the majority negatively affect liquidity risk. Notably, only the dimension of commitment towards debtors (CTD) negatively impacts credit risk. These results remain robust even after addressing potential endogeneity issues.

Originality/Value: The study underscores the impact of CSR disclosure on the financial stability of Islamic banks within the GCC, demonstrating their role in fostering stable returns and enhancing overall financial health.

Item ID:	86551
Item Type:	Article (Research - C1)
ISSN:	1753-8408
Keywords:	CSR disclosure, Dividend policy, Islamic banks, GCC
Copyright Information:	© Emerald Publishing Limited.
Date Deposited:	12 Aug 2025 00:24
FoR Codes:	35 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 3502 Banking, finance and investment > 350204 Financial institutions (incl. banking) @ 70% 35 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 3502 Banking, finance and investment > 350299 Banking, finance and investment not elsewhere classified @ 30%
SEO Codes:	11 COMMERCIAL SERVICES AND TOURISM > 1102 Financial services > 110201 Finance services @ 100%
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