title: Exploring the governance of Takaful (Islamic insurance) in Brunei
Creators: name: Hj Besar, Mohd Hairul Azrin
Publisher: name: University of Glasgow
Year: 2017
Subjects: subject: Governance, Takaful, Islamic insurance, contractual structure, Takaful financial disclosures.

description: The prohibition of insurance as specified in the conventional business model has led to Takaful being established for the Muslim community to fulfil their accountability/obligations towards Allah. The absent of a contract in Takaful, a replacement of the conventional sale contract in insurance has resulted in the emergence of Muamalah contracts as a basis for contractual structures and this bear the minimum acceptable requirement of Shariah. The attainability of such contractual structures to be used in Takaful had been unstable in the sense that it needs various reviews, and this has occurred precisely because it has been laden with both Shariah compliance and operational issues detaching the contracts from its original Shariah and economic substances. This research explores how the governance of Takaful in Brunei considered and adapted unstable contractual structure for Takaful operation inciting the divergence from the fundamental principles of Shariah. 
The main objective of the research is to explore the governance of Takaful in Brunei. The research seeks to identify and analyse the factors that influence the adaption of the Takaful contractual structure, examine the logics behind the current governance framework, and investigate the disclosure of information and financial reporting of Takaful. It utilizes the interpretive approach and this is supported by qualitative research methods in the form of interviews, participant observation and document review.
The thesis also uncovers the causal factors of the necessity to adapt unstable contractual structure, and this in turn raises the concern of how Takaful is governed. In this work neo institutional theory of institutional isomorphism is used to identify these factors and the manner in which they influence the adaption process. In addition, the logical reference exhilarating the governance framework of Takaful is examined through the lens of institutional logic theory to understand why it has not been possible to alleviate concerns surrounding the adaption of the contractual structure. The analysis also extends to unravel the core logics of governance driving Takaful disclosure and financial reporting. 
Empirical findings show that the Brunei government has been the main driving factor in terms of adapting the current contractual structure during the initial creation of Takaful in Brunei. Ironically conventional insurance has been used to define the boundaries for structuring the contractual model for Takaful to replace conventional insurance model. 
Other factors at the macro (e.g. government influence), meso (e.g. the industry) and micro (e.g. between the companies and within each company) levels have also influenced the current contractual structure through the main three forces: coercive (e.g. government enforcement), normative (e.g. Legal Framework) and mimetic (e.g. following other Takaful operators). Decoupling the substance of the contract and actually implementing it is masked by the Shariah governance responsible for approving the individual contracts without evaluating the whole business structure from the Shariah perspective. 
The business and Shariah logics are the main dominance of Takaful governance frame of reference. Separation between these two logics served as sustainable force for its ability to reflect the compliance status desired by the industry. This creates trust in governance and an environment of adhering to Shariah in good faith. Disclosure and financial reporting decisions are driven by the regulatory, market and Shariah logics, where the regulatory logic dominates the mandatory disclosures. Finally, in evaluating these factors that influence the governance of Takaful in Brunei the thesis offers options of how to improve the contractual structure and addressing concerns thereof.