COMPARISON OF GOOD CORPORATE GOVERNANCE PRINCIPLES IN CONVENTIONAL BANKS AND ISLAMIC BANKS IN INDONESIA

Abstract

In terms of how to determine prices, banks are divided into two types, namely conventional banks and Islamic banks. Conventional banks and Islamic banks must apply the principles of Good Corporate Governance in their business activities because conventional banks and Islamic banks are intermediary institutions that function to collect funds from the public and channel these funds back to the public on the basis of trust. This research aims to explain the comparison of the principles of Good Corporate Governance in conventional banks and Islamic banks in Indonesia. The method used in this research is normative legal research, using a statutory approach. The principles of Good Corporate Governance, namely the principles of transparancy, accountability, responsibility, independence and fairness. Basically, the application of the principles of Good Corporate Governance in conventional banks and Islamic banks is the same, because it refers to the 'Guidelines for Good Corporate Governance of the Indonesian Banking' issued by the National Committee on Governance Policy. The difference is the principle of Good Corporate Governance in Islamic banks is strictly regulated in Article 34 Paragraph (1) of Law No. 21/2008. Another difference lies in the Islamic principles used by Islamic banks because besides being fostered and supervised by the Financial Services Authority, Islamic banks also supervised by the National Sharia Council of the Council of Indonesian Ulama in general and the Sharia Supervisory Board in particular.