Benue State University, Makurdi

Legal and Regulatory Framework for Corporate Governance of Islamic Banks in Nigeria and Malaysia: A Review of Literature

Ahmed A. Muhammed-Mikaaeel*and Aishat Abdul-Qadir Zubair**

Abstract

Legal and regulatory framework for corporate governance of Islamic Banks in Nigeria has received bellyful of criticisms from several quarters owing to various claims of their inadequacy and unsuitability. Worse still, report has it that Islamic Banks in Nigeria enjoys no special legislation for its corporate governance contrary to what obtains in similar clime. The foregoing thus prompted this research by literature review approach. Relying purely on doctrinal method, this article examines the legal and regulatory framework for corporate governance of Islamic banks in Nigeria and Malaysia vide review of existing literature. From the literature reviewed, the research finds that Islamic banks in Nigeria were subjected to laws which were originally conceived for the corporate governance of conventional banks in Nigeria; that there is no single legislation enacted specially for corporate governance of Islamic banks in the country contrary to the case in Malaysia; that the existing legal and regulatory framework for corporate governance of Islamic banks in Nigeria are not only defective and unsuitable but also have the potentials to defeat the purpose for which Islamic banks were established. The research thus recommends that it is high time Nigeria borrowed leaf from Malaysia by enacting a special legislation for the corporate governance of Islamic Banks in the country.

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