ABSTRACT
This chapter looks at the approach adopted by Islamic commercial banks to finance their corporate social responsibility (CSR) programs. When Islamic commercial banks pay their corporate zakat, do they deem the zakat paid to be a source of their CSR funds or do they budget for a CSR fund separately? How this distinction affects the implementation of their social programs? This chapter reveals that Islamic commercial banks’ stand on corporate zakat as a CSR source is like a continuum of an affirmative, ambivalent, and hostile position. As a concept, some hesitate to affirm that corporate zakat is their CSR because of perceived different values underlying zakat and CSR. In practice, corporate zakat has become an integral part of Islamic commercial banks’ CSR in Indonesia. Despite this, they do not mix corporate zakat utilization with CSR due to the belief that the zakat beneficiaries have been limitedly dictated by sharīʿa. This measure is taken based on Islamic ethics (maslaha-cum-maqasid or an intention to achieve public welfare within the boundary of sharīʿa) that guides Islamic commercial banks in implementing their CSR.
