Sustainability Governance in Islamic Banking: A Bibliometric and Systematic Literature Review of ESG Research

Nurun Najmi

doi:10.31004/riggs.v5i2.13432

Authors

Nurun Najmi Universitas Pembangunan Nasional “Veteran” Jakarta

DOI:

https://doi.org/10.31004/riggs.v5i2.13432

Keywords:

ESG, Islamic Banking, Systematic Literature Review, Bibliometric

Abstract

Purpose – ESG (Environmental, Social, and Governance) integration in Islamic banking has attracted growing scholarly attention in recent years. Nevertheless, a comprehensive academic mapping of this rapidly expanding field remains limited. Therefore, the present investigation seeks to conduct a systematic literature review combined with a bibliometric analysis of ESG research in Islamic banking, anchored in currently available observational data. Methodology – This study employs a structured literature review as its primary investigative framework, using the keyword phrases “ESG” and “Islamic bank*” across “Article Titles, Abstracts, and Keywords” in the Scopus database, yielding a collection of 73 documents published between 2020 and 2026. This data extraction took place on August 12, 2026. Subsequently, the gathered information was subjected to a bibliometric examination utilizing the VOSviewer application. Findings – ESG research in Islamic banking remains concentrated in Muslim-majority regions, with prior studies largely centered on Indonesia and Malaysia, alongside GCC countries. Future research should expand toward non-Muslim-majority regions and explore how Shariah-compliant ESG frameworks can inform sustainable finance globally. Beyond bibliometric findings that emphasize governance, sustainability reporting, and profitability themes, this study advances theoretical understanding by positioning ESG disclosure as a strategic instrument for risk mitigation and financial performance enhancement in Islamic banks. In practice, the proposed framework provides guidance for Islamic banking institutions to embed ESG principles consistently with Maqasid al-Shariah objectives. Originality – Research on ESG in Islamic banking is expanding rapidly. However, studies examining the conceptual alignment between ESG frameworks and Shariah principles, and their impact on bank performance dimensions, remain limited.

Downloads

Download data is not yet available.

References

[1] M. Alkindi and W. Utami, “A COMPARATIVE STUDY OF ISLAMIC CONFORMITY, PROFITABILITY, AND GREEN PERFORMANCE IN SOUTHEAST ASIAN ISLAMIC BANKS,” Banks Bank Syst., vol. 20, no. 1, pp. 174–190, 2025, doi: 10.21511/bbs.20(1).2025.15.

[2] T. Nawaz, “AAOIFI Sharī’ah standard no. 62: a friend or foe to green finance?,” J. Islam. Account. Bus. Res., pp. 1–15, 2026, doi: 10.1108/JIABR-03-2025-0140.

[3] D. H. Achyar, “Advancing sustainability disclosure with xBRL to accelerate climate policy for ESG,” J. Islam. Account. Bus. Res., pp. 1–17, 2025, doi: 10.1108/JIABR-11-2024-0463.

[4] A. Fikriyah and T. Ningtyas, “Assessing the effect of green disclosure on profitability and firm value in Indonesian Islamic banks,” Discov. Sustain., vol. 7, no. 1, 2026, doi: 10.1007/s43621-026-02884-9.

[5] S. Kholil and M. Hersi, “Between Strictness and Flexibility: A Comparative Insight into Qawāʿid al-Fiqhiyyah in Islamic Banking Practices of Saudi Arabia and Pakistan,” Banco, vol. 6, no. 2, pp. 114–126, 2024, doi: 10.35905/banco.v6i2.12799.

[6] M. A. Salami, A. Muneeza, and S. A. Bin-Nashwan, “COMMITMENT OF THE ISLAMIC BANKING INDUSTRY TO ESG IN SELECTED COUNTRIES: EVALUATION FROM THE MAQĀṢID AL-SHARĪʿAH PYRAMID PERSPECTIVE,” Int. J. Islam. Finance Sustain. Dev., vol. 17, no. 2, pp. 65–86, 2025, doi: 10.55188/ijifsd.v17i2.1015.

[7] M. Mateev, A. Sahyouni, and S. Moudud-Ul-Huq, “Connecting the ESG factors to banks’ financial performance and sustainability: the need for strategic alignment,” Cogent Bus. Manag., vol. 13, no. 1, 2026, doi: 10.1080/23311975.2026.2645274.

[8] R. Kasanah and M. Anis, “CONTENT ANALYSIS OF ESG IMPLEMENTATION IN MAJOR ISLAMIC BANKING IN SELECTED OIC COUNTRIES,” J. Ekon. Dan Bisnis Islam, vol. 12, no. 1, pp. 365–387, 2026, doi: 10.20473/jebis.v12i1.83388.

[9] S. M. Pramudena, L. N. Wati, and E. Marlapa, “CORPORATE LAW AND SHARIA GOVERNANCE: EMPIRICAL INSIGHTS, RISK-BASED BANK RATING, AND ESG ISLAMIC APPROACH,” Corp. Law Gov. Rev., vol. 8, no. 1, pp. 64–75, 2026, doi: 10.22495/clgrv8i1p5.

[10] M. B. Zafar, “Corporate social responsibility in Islamic finance: a two-decade bibliometric analysis,” J. Islam. Account. Bus. Res., pp. 1–28, 2025, doi: 10.1108/JIABR-12-2024-0497.

[11] A. M. Alessa and S. P. Dhakal, “Corporate Social Responsibility Reporting in the Saudi Arabian Banking Sector: Implications for Vision 2030,” Sustain. Switz., vol. 18, no. 7, 2026, doi: 10.3390/su18073213.

[12] D. Bentaleb, “Digital transformation and ESG performance in emerging-market banks: asymmetric effects across environmental, social and governance pillars,” Compet. Rev., 2026, doi: 10.1108/CR-06-2025-0189.

[13] S. Neifar Abdelkefi and A. Jarboui, “Does CEO power affect operational risk and ESG disclosure in Islamic banks? Evidence from the banking sector,” Manag. Sustain., pp. 1–16, 2026, doi: 10.1108/MSAR-04-2025-0124.

[14] M. K. Hassan, M. R. Rabbani, and M. Kiran, “DOES DIGITAL FINANCIAL INCLUSION IMPACT ESG PERFORMANCE IN ISLAMIC AND CONVENTIONAL FINANCIAL INSTITUTIONS? A GLOBAL EVIDENCE,” J. Islam. Monet. Econ. Finance, vol. 11, no. 3, pp. 511–534, 2025, doi: 10.21098/JIMF.V11I3.2340.

[15] M. R. Rabbani, M. Kiran, A. B. Bhuiyan, and A. Al-Hiyari, “Does diversity in top management and boards affect ESG performance? Evidence from Islamic and conventional banks in the MENA region,” Int. J. Islam. Middle East. Finance Manag., vol. 17, no. 6, pp. 1244–1266, 2024, doi: 10.1108/IMEFM-06-2024-0281.

[16] S. Muneer, A. Singh, M. H. Choudhary, A. S. Alshammari, and N. A. Butt, “Does Environmental Disclosure and Corporate Governance Ensure the Financial Sustainability of Islamic Banks?,” Adm. Sci., vol. 15, no. 2, 2025, doi: 10.3390/admsci15020054.

[17] I. Ben Salah, E. Klibi, H. Smaoui, K. Souki, and H. Miniaoui, “Does Environmental, Social, and Governance Performance Reduce Credit Risk? Evidence from Islamic and Conventional Banks in the Gulf Cooperation Council,” Sustain. Switz., vol. 18, no. 12, 2026, doi: 10.3390/su18126324.

[18] H. Smaoui, D. Aassouli, and Y. Elakhdar, “Does ESG Influence Bank Profitability? A Comparison Between Islamic and Conventional Banks,” Corp. Soc. Responsib. Environ. Manag., vol. 32, no. 5, pp. 6048–6065, 2025, doi: 10.1002/csr.70010.

[19] Y. K. Tumewang, E. E. Alharasis, and K. Toumi, “Does ESG reporting truly align with carbon performance? New evidence from the dual banking sector in emerging markets,” Sustain. Account. Manag. Policy J., vol. 17, no. 4, pp. 1054–1091, 2026, doi: 10.1108/SAMPJ-07-2024-0737.

[20] N. Lassoued, I. Khanchel, and Z. Ghazouani, “East or west, experience is best: ESG, cost efficiency and CEO international background in MENA banks,” Technol. Forecast. Soc. Change, vol. 228, 2026, doi: 10.1016/j.techfore.2026.124670.

[21] A. Faizulayev, “Empirical examination of ESG and fintech factors on financial sustainability: a comparative study of Islamic vs conventional banks in Islamic finance-oriented countries,” Asian J. Account. Res., vol. 11, no. 1, pp. 2–21, 2026, doi: 10.1108/AJAR-09-2024-0382.

[22] R. Basri, S. A. Al Mamun, and A. Aktar, “Environmental, social and governance disclosure practices of Islamic banks across Asian countries: changes around the COVID-19 period,” J. Int. Bus. Entrep. Dev., vol. 18, no. 1, pp. 110–129, 2026, doi: 10.1504/JIBED.2026.10079194.

[23] A. W. Alam, H. Banna, and M. K. Hassan, “ESG ACTIVITIES AND BANK EFFICIENCY: ARE ISLAMIC BANKS BETTER?,” J. Islam. Monet. Econ. Finance, vol. 8, no. 1, pp. 65–88, 2022, doi: 10.21098/jimf.v8i1.1428.

[24] M. U. Islam, B. Abdul Hamid, and M. N. Shahid, “ESG activities and bank performance with the moderating influence of competition and regulatory quality: a study in the organization of Islamic countries,” Int. J. Islam. Middle East. Finance Manag., vol. 18, no. 2, pp. 441–466, 2025, doi: 10.1108/IMEFM-01-2024-0052.

[25] F. Fakhrunnas, T. Kenc, and Z. Hengchao, “ESG AND BANKING PERFORMANCE IN EMERGING AND DEVELOPING COUNTRIES: DO ISLAMIC BANKS PERFORM BETTER?,” J. Islam. Monet. Econ. Finance, vol. 11, no. 1, pp. 175–198, 2025, doi: 10.21098/jimf.v11i1.2429.

[26] F. Fakhrunnas, T. Kenc, and H. Zhang, “Esg Commitment and Bank’s Default Risk in Emerging and Developing Countries: Does Islamic Bank Matter?,” Akad. Gida, vol. 11, no. 4, pp. 713–742, 2025, doi: 10.24323/AKADEMIK-GIDA.475396.

[27] R. A. Salem and M. Abualazm, “ESG compliance and financial performance: a comparative study of Islamic and conventional banks in the MENAT region,” Rev. Account. Finance, pp. 1–26, 2026, doi: 10.1108/RAF-08-2024-0333.

[28] O. Belkhir, A. Saadaoui, and M. A. Boujelbene, “ESG Disclosure and Financial Stability of Islamic and Conventional Banks,” J. King Abdulaziz Univ. Islam. Econ., vol. 38, no. 1, pp. 69–93, 2025, doi: 10.4197/Islec.38-1.4.

[29] W. Yuspin, K. Wardiono, and T. M. A. P. Ogli, “ESG Disclosure Maturity in Indonesian Islamic Banks: Legal Implications for Green Banking Regulation,” WSEAS Trans. Bus. Econ., vol. 23, pp. 1087–1097, 2026, doi: 10.37394/23207.2026.23.83.

[30] S. Srairi, “ESG performance in GCC banks: the influence of ownership structure, risk attitude and board characteristics in Islamic vs conventional contexts,” Sustain. Account. Manag. Policy J., vol. 17, no. 4, pp. 1092–1138, 2026, doi: 10.1108/SAMPJ-11-2024-1190.

[31] N. A. I. N. Abdullah and R. Haron, “ESG REPORTING PRACTICES AMONG ISLAMIC BANKS: A GLOBAL PERSPECTIVE,” IIUM Law J., vol. 30, no. S2, pp. 1–37, 2022, doi: 10.31436/iiumlj.v30iS2.755.

[32] A. M. Buallay, R. M. Abu Wadi, G. Kukreja, and A. A. Hassan, “Evaluating ESG disclosures of Islamic banks: Evidence from the Organization of Islamic Cooperation Members,” Int. J. Innov. Sustain. Dev., vol. 14, no. 3, pp. 266–287, 2020, doi: 10.1504/IJISD.2020.108045.

[33] Z. Serkbayeva, M. Zhumabayeva, G. Kassenova, G. Karimbayeva, A. Faizulayev, and D. Kulumbetova, “Examining the impact of fintech and other factors on banking practices: QISMUT + 3 countries,” Cogent Bus. Manag., vol. 11, no. 1, 2024, doi: 10.1080/23311975.2024.2385069.

[34] P. Debnath and P. Chellasamy, “Exploring the relationship between ESG, CSR, sustainability reporting and financial performance: a bibliometric analysis using VoS-viewer,” Int. J. Sustain. Dev., vol. 29, no. 1, pp. 44–78, 2026, doi: 10.1504/IJSD.2026.150558.

[35] S. A. A. Bukhari, F. Hashim, A. B. Amran, and K. Hyder, “Green Banking and Islam: two sides of the same coin,” J. Islam. Mark., vol. 11, no. 4, pp. 977–1000, 2020, doi: 10.1108/JIMA-09-2018-0154.

[36] S. Srairi, “How does ESG performance affect bank performance? A comparative analysis of conventional and Islamic banks in GCC countries,” Int. J. Discl. Gov., 2025, doi: 10.1057/s41310-025-00319-x.

[37] R. Yudaruddin, N. Che Yahya, and S. N. Mohd Rashid, “How ESG risk influences bank performance: insights from Islamic banking sector in Indonesia,” J. Islam. Account. Bus. Res., 2025, doi: 10.1108/JIABR-09-2024-0343.

[38] A. Alhamrani, A. Awoad, and M. Albaity, “Influence of ESG on Credit Growth: Moderating Effects of Islamic Bank and Size in MENA,” Int. J. Financ. Stud., vol. 14, no. 1, 2026, doi: 10.3390/ijfs14010010.

[39] R. Alghafes, S. Karim, K. Aliani, N. Qureishi, and L. Alkayed, “Influence of key ESG factors on Islamic banks’ financial performance: Evidence from GCC countries,” Int. Rev. Econ. Finance, vol. 96, 2024, doi: 10.1016/j.iref.2024.103629.

[40] M. Al-Nimer, “Innovation Capacity as a Mediating Mechanism Between Strategic Risk Integration and ESG Performance: Evidence from Jordanian Banks,” Int. J. Financ. Stud., vol. 12, no. 4, 2024, doi: 10.3390/ijfs12040126.

[41] M. A. Ghaith, “Investigating the impact of Islamic bank sukuk profitability on Jordanian capital expenditure under the moderating role of GDP from 2017 to 2024,” Discov. Sustain., vol. 7, no. 1, 2026, doi: 10.1007/s43621-025-02330-2.

[42] F. Bennaceur, A. Bendob, and A. H. A. Othman, “Leveraging AI for ESG disclosures: a deep dive into UAE’s Islamic and conventional banking sectors,” J. Financ. Report. Account., pp. 1–24, 2026, doi: 10.1108/JFRA-05-2025-0390.

[43] H. Al Banna and A. Z. Putri, “Macro and micro prudential incentives in ESG lending in dual banking system: do Islamic banks have better ESG lending?,” J. Islam. Account. Bus. Res., pp. 1–20, 2026, doi: 10.1108/JIABR-12-2024-0491.

[44] S. A. Rahman, N. H. Ahmad, and N. C. Arshad, “Macroeconomic and Firm-Specific Effects on Islamic Deposits Sustainability,” Pap. Asia, vol. 40, no. 2b, pp. 12–19, 2024, doi: 10.59953/paperasia.v40i2b.84.

[45] N. Ahmad, M. S. Hanapi, and Y. F. Yasin, “MAQASID SHARIAH AND ISLAMIC FINTECH RESEARCH: TRENDS, TOPICS AND COLLABORATIONS,” J. Ilm. Peuradeun, vol. 13, no. 3, pp. 2271–2310, 2025, doi: 10.26811/peuradeun.v13i3.1829.

[46] E. Fahmy, M. N. Hosen, T. D. Warninda, A. Rama, and Q. Aimar, “Measuring Contemporary Islamic Banking Sustainability: Integrating ESG and Maqashid al-Syarī‘ah in Indonesia,” MILRev Metro Islam. Law Rev., vol. 5, no. 1, pp. 351–378, 2026, doi: 10.32332/milrev.v5i1.12880.

[47] D. A. Nimotallahi, I. O. Oyelakin, H. O. Durojaiye, A. H. Yusuf, and W. A. Khan, “Merger-Driven Expansion, ESG Integration and Digital Innovation in Islamic Megabanking: A Maqasid al-Shariah Performance Analysis of Kuwait Finance House,” Sustain. Dev., 2026, doi: 10.1002/sd.71273.

[48] J. Othman and D. Z. Gabbori, “NAVIGATING CREDIT RISK IN ISLAMIC BANKS: A MULTIDIMENSIONAL ANALYSIS OF NON-PERFORMING LOANS,” Int. J. Islam. Finance Sustain. Dev., vol. 16, no. 4, pp. 4–21, 2024, doi: 10.55188/ijifsd.v16i4.928.

[49] H. A. Altamimi, M. K. Hassan, M. R. Rabbani, and M. Kiran, “Navigating ESG risks in banking: The role of green finance, policy, and FinTech in Islamic and conventional banks,” Econ. Anal. Policy, vol. 91, pp. 1537–1558, 2026, doi: 10.1016/j.eap.2026.05.006.

[50] R. Ramli, A. A. Bakar, S. M. R. Y. S. Umar, N. Ibrahim, and M. F. Aziz, “Operationalizing Maqasid Al-Shariah: A Tripartite Framework for Scaling Ethical Finance through Technology, Talent, and Transparent Metrics,” Int. J. Spec. Educ., vol. 41, no. 3S, pp. 646–660, 2026.

[51] K. U. Mohammad, K. Hussain, and S. Aziz, “Response to ESG controversies: global evidence from islamic and conventional banks,” J. Islam. Account. Bus. Res., pp. 1–22, 2026, doi: 10.1108/JIABR-01-2026-0055.

[52] B. Dorsaf, “RETRACTED: Breaking glass ceilings or boardroom gridlock? Gender, independence and the new rules of MENA banking resilience,” J. Econ. Stud., pp. 1–21, 2025, doi: 10.1108/JES-06-2025-0440.

[53] Y. Boudawara, K. Toumi, A. Wannes, and K. Hussainey, “Shari’ah governance quality and environmental, social and governance performance in Islamic banks. A cross-country evidence,” J. Appl. Account. Res., vol. 24, no. 5, pp. 1004–1026, 2023, doi: 10.1108/JAAR-08-2022-0208.

[54] T. Fitrijanti, N. N. Afiah, and S. Hadinata, “Shariah governance effects on cash holdings under sustainability commitments: Indonesian Islamic banks,” Banks Bank Syst., vol. 20, no. 4, pp. 20–30, 2025, doi: 10.21511/bbs.20(4).2025.02.

[55] R. Purnamasari, N. Nirmalasari, and H. D. Ibrahim, “Shariah-compliant Fintech in Banking: Bridging Financial and Cultural Gaps for Inclusive Shariah Finance in Indonesia and the Philippines,” Banco, vol. 6, no. 2, pp. 150–160, 2024, doi: 10.35905/banco.v6i2.9512.

[56] Y. K. Tumewang, T. Almarayeh, and E. Alharasis, “Sustainability Committee, External Assurance, and ESG Performance: Empirical Evidence From Banking Industry in Emerging Economies,” Corp. Soc. Responsib. Environ. Manag., vol. 32, no. 2, pp. 2728–2745, 2025, doi: 10.1002/csr.3095.

[57] M. Kiran, M. R. Rabbani, K. H. Khan, M. Atif, M. Talha, and S. Chughtai, “Sustainability reporting as a shield: Exploring ESG disclosures, governance, and stock crash risks in Islamic and conventional banks,” Sustain. Futur., vol. 10, 2025, doi: 10.1016/j.sftr.2025.101469.

[58] M. B. Zafar, “Talk or action? Unveiling the nature and depth of climate disclosures in Islamic banks using machine learning,” Borsa Istanb. Rev., vol. 26, no. 2, 2026, doi: 10.1016/j.bir.2026.100789.

[59] J. Shi, E. A. Firmansyah, Y. Wang, and W. Xu, “Technological innovation and regulatory harmonization in Islamic finance: a systematic review and machine learning analysis (2000–2023),” J. Islam. Account. Bus. Res., 2025, doi: 10.1108/JIABR-01-2025-0026.

[60] A. Sendi, H. Banna, M. K. Hassan, and T. I. Huq, “The effect of ESG scores on bank stability: Islamic vs. conventional banks,” J. Sustain. Finance Invest., 2024, doi: 10.1080/20430795.2024.2395876.

[61] T. Budiman, E. Febrian, and Y. Azis, “THE EFFECT OF GEOGRAPHICAL FACTORS ON ISLAMIC BANKING SUSTAINABILITY PERFORMANCE: AN INSTRUMENTAL VARIABLE QUANTILE REGRESSION ANALYSIS,” Asian Econ. Financ. Rev., vol. 12, no. 2, pp. 70–88, 2022, doi: 10.18488/5002.v12i2.4411.

[62] Y. K. Tumewang, K. P. Ayunda, M. R. Azzahra, and M. K. Hassan, “The effects of diversity and inclusion on ESG performance: A comparison between Islamic and conventional banks,” Borsa Istanb. Rev., vol. 24, no. 6, pp. 1101–1110, 2024, doi: 10.1016/j.bir.2024.10.001.

[63] S. Almulla, M. Albaity, and H. A. Hassan Al-Tamimi, “The Effects of ESG and Institutional Quality on Financial Stability: Evidence from GCC Banks,” Int. J. Econ. Financ. Issues, vol. 15, no. 2, pp. 309–326, 2025, doi: 10.32479/ijefi.18152.

[64] J. M. Maside-Sanfiz, A. Iglesias-Casal, Q. A. S. Mazahreh, and M. C. López-Penabad, “The impact of competition on environmental and social performance in the MENA banking sector,” Corp. Soc. Responsib. Environ. Manag., vol. 31, no. 6, pp. 6290–6317, 2024, doi: 10.1002/csr.2924.

[65] S. Srairi, “The impact of risk and Fintech on ESG performance: evidence from gulf cooperation council (GCC) banks,” J. Chin. Econ. Bus. Stud., vol. 23, no. 3, pp. 363–404, 2025, doi: 10.1080/14765284.2024.2428240.

[66] Y. K. Tumewang and F. Fakhrunnas, “The impact of Sharia governance and ESG commitment on Islamic banks’ performance,” J. Islam. Account. Bus. Res., pp. 1–26, 2026, doi: 10.1108/JIABR-01-2025-0046.

[67] F. Agustin, R. Muhtadi, and S. Sahal, “The Importance of Implementing Environment, Social and Government (ESG) and Maqasid Sharia-Based Islamic Finance in Islamic Bank,” J. Islam. Econ. Laws, vol. 6, no. 2, pp. 133–158, 2023, doi: 10.23917/jisel.v6i2.21214.

[68] R. Jannah, B. Uluyol, H. A. A. Thaidi, and S. Najma, “The Influence of Green Financing and Return Dynamics on Environmental, Social, and Governance Performance: Evidence from Indonesia’s Islamic Banking Sector,” Al-Muamalat, vol. 13, no. 1, pp. 169–185, 2026, doi: 10.15575/am.v13i1.54428.

[69] A. Hkimi and K. Ftouhi, “The moderating role of female directors in improving ESG performance through intellectual capital: evidence from GCC countries,” Corp. Gov. Bingley, pp. 1–28, 2025, doi: 10.1108/CG-01-2025-0015