Principle Of Good Governance In Islam

Both the Quran and Sunnah have given some study the principles in the areas of constitutional affairs that cannot be omitted from any government system. The Quran does not mention the particulars and details and have been left for the Muslim Ummah to formulate according to time and place. In the application of constitutional principles or guidelines of Islamic political system, general rules or fundamental principles which are considered as the highest values have a major impact on the formation of the Islamic concept of the state, its functions and its system of government. The basic principles, concepts and rules are discussed below.

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The Concept of Sovereignty in the Islamic System

The sovereignty in Islam belongs to God. The Quran tells us that Allah (SWT) is the creator and Lord of the entire universe, including the human kind and all associated with them. Therefore, Allah (SWT) is the one who has all the powers and attributes of sovereignty and nothing whatever that belongs everywhere. Thus, no one else can share the sovereignty of the entire universe as it only belongs to Allah (SWT). Command is only for Allah. He has commanded that you do not submit to anybody but him. This is the Right Way of life, but most men understand not.

The rule of law in the Islamic System

The principle of the rule of law in the Islamic system is considered as a base or corner stone where Islam was founded on a stake and Shariah, because Islam came to remove injustice and tyranny and struggled to knock down the ultimate power pole. Thus, the basic principles contained in the Qur’an, Sunnah and consensus (‘ijma’) even in the century struggling with tyranny.

Allah (SWT) says:

O ye who believe! Obey Allah, and obey the Messenger, and those charged with authority among you. If ye differ in anything among yourselves, refer to Allah and His Messenger, if ye do believe in Allah and the last Day: that is best, and most suitable for final determination [1] .

In another verse Allah (SWT) says:

O ye who believe! Obey Allah. And obey the Messenger, and make not vain your deeds! [2]

Therefore, the Islamic judge must implement the Quran and Sunnah in all disputes brought before him. If he does not perform it, his behavior is not acceptable because he failed to fulfill the duties of a judge according to Sharia.

The Sunnah came to support, emphasise and clarify these Quranic verses.

Prophet Muhammad (SAW) said that:

Obedience of a human being is disallowed, if it is considered disobedience to the creator (Allah) [3] .

Prophet Muhammad (SAW) also said that:

Every act that does not conform to our order is rejected [4] .

In the Islamic system, everyone, from heads of state, government and people, are subject to the law. The Prophet (SAW) himself is subject to, and is the most faithful to the Quran. He was ‘Abd Allah wa rasuluh’, the servant of God and his messenger. The head of state and the head of government cannot invoke any immunity from impeachment. The principle, ‘Be you ever so high, the law is above you’ has always been there in Islamic law, to include the Prophet (SAW) himself.

Just before he died, the Prophet (SAW) made the following short speech:

I swear by God that I have made lawful only those things that the Quran made lawful and I have made unlawful only those things that the Quran made unlawful. If I have taken the money of any of you, here is my money, let him come and take it, and if I have lashed the body of any, here is my body, let him take back his right [5] .

In the same way, Abu Bakr, the first successor and caliph of the Muslim state, in his acceptance speech said:

O people! I have been appointed over you, but I am not the best of you. Support me if I did good and remove me if I did badly … a weak person of you is strong before me as long as I maintain his right for him. And a strong one of you is weak before me until I take back a right from him … Obey me as long as I obeyed Allah and his Messenger. If I disobeyed them there is no obedience of me upon you [6] .

The past verses supported by the hadith shows that every dispute within the Muslim community between individuals, groups of people, or between people and the government, or among the parts the government and people, must be judged by the basic law we received from Allah (SWT) and His Messenger.

According to this principle, the country must have an institution that judges among the people of the Qur’an and Sunnah, and the institution is a judicial authority.

The Doctrine of the Separation of Powers and Independence of the Judiciary

Separate branches of government have different functions is not an idea that is contrary to the Shariah. There is no detailed prescription about the form of government in the Quran. What is clear is the goal of the state and the principles that should be followed by the government. Hence the idea to promote good governance, organized by the Shariah, is compatible with Islam. In addition, the doctrine of judicial independence is a constitutional principle in Islamic constitution. Judges are independent and subject to no other authority but the law.

In Islam, there are a number of recognized institutions may have in common with democratic forms of government. For example, the emir may be likened to the Prime Minister or President who is the chief government or executive body; assembly, which is recognized in both Islam and democracy as a means to discuss the laws and policies made aˆ‹aˆ‹by the government, which recognized both Islam and democracy, and last but not least, the judiciary. Therefore, in Islam, the principle of check and balance as practiced under the doctrine of separation of powers can be exercised. Furthermore, it has been claimed that the doctrine of separation of powers has been used at the time of the Prophet in the city state.


As-shura is one of the most important constitutional principles in the Islamic constitution. The proof of the importance of shura is to be found in the Quran and Sunnah. In one of the two clear verses on it in the Quran, shura is mentioned as mandatory and in the other verse, it is mentioned that those who practice it are praised. The whole system of the Islamic state from its inception to the selection of the head of the state and all those in positions of power as well as its dealings must be conducted by shura, whether it is carried out directly or indirectly through selected or elected representatives.

The Quran states that:

Those who hearken to their Lord, and establish regular Prayer; who (conduct) their affairs by mutual Consultation; who spend out of what We bestow on them for Sustenance. [7]

Even the Prophet, although he was the recipient of direct guidance from the Supreme Allah, was command-ed. Allah says:

Consult them in affairs (of moment). Then, when thou hast taken a decision put thy trust in Allah. For Allah loves those who put their trust (in Him). [8]

Following this advice and lead, Caliph Umar admonished that:

There is no khilafah without consultation. [9]

Thus, the practice of shura is the mechanism followed at all stages in the selection of political leadership by Muhammad and his followers. It was the first Muslim elected four khulafah guidance, although the selection and approval process varies. The important principle is the truth and accountability and public confidence in those elected by the community. Even after that when crawling hereditary rule in violation of this community right, mask allegiance, or acceptance of government still retained.


Islam has given to the justice position is so well known as the law may have previous system of law, old or new, that had given him. There are many verses of the Qur’an that speak and enjoy justice, universal order encompassing all human affairs.

In one of the verses of the Quran in which enjoying justice has been generally and unqualifiedly ordered, Allah says:

Allah commands justice, the doing of good, and liberality to kith and kin, and He forbids all shameful deeds, and injustice and rebellion: He instructs you, that ye may receive admonition. [10]

In another verse of the Quran, it is stated that:

Allah doth command you to render back your Trusts to those to whom they are due; And when ye judge between man and man, that ye judge with justice: Verily how excellent is the teaching which He giveth you! For Allah is He Who heareth and seeth all things. [11]

Justice in the Islamic political system, including social justice, which means that the government should arrange to meet and satisfy the needs and desires of all the people as they have a valid part of the state and the source of bona fide citizens of the country. This includes the provision of job, means of subsistence and economic justice. This in turn suggests that it is the responsibility of the government to provide food, shelter and clothing for all the people in the state. Economic justice aimed at equitable distribution of lifestyle and checks the concentration of wealth in a few hands. That is why the second Caliph Umar refused to divide land among the Muslim soldiers and commanders in areas conquered by Muslims in Iraq, Iran and Syria.

Only justice can create discipline in life of the people. It is also important that the administration of justice, which means that all state officers are also subject to accountability and they do not need to consider and treat the person as a ‘slave’ or ‘personal assistant’. They should not insult the people in any manner. They should be honest and efficiently in administer public affairs. It should be ensured that the concentration of wealth in one class or few hands did not happen. There is absolutely no doubt, that the governing principle of Islam is a set of the most comprehensive scientific and principles of efficient administration.


Contemporary scholars of modern constitutional law divide into several branches of freedom: freedom of thought and belief, the right to education and property and personal freedom. There is no question that the Islamic Constitution gives such great consideration and respect for this freedom because it has rarely been given by other political doctrine in the Constitution of the positive. Man has continued to use the right of choice ever since he has been on the earth. On this point that the Quran makes is as follows:

Seest thou not that to Allah bow down in worship all things that are in the heavens and on earth, the sun, the moon, the stars; the hills, the trees, the animals; and a great number among mankind? But a great number are (also) such as are fit for Punishment: and such as Allah shall disgrace — None can raise to honour: for Allah carries out all that He wills.


The principle of equality is one of the most important constitutional principles upon which the contemporary system rests. This means that the principle of equality contained in the individual communities are equal in rights, responsibilities and public duties that will be enjoyed by all without discrimination of race, origin, lan-measure or belief. The principle of equality has been initiated by the Qur’an and Sunnah and the expansion of Islam during some as a precedent in Islamic law and its own time and place; precedent is a fundamental revolution in the basic concept of Arab ideas about the source of pride as the notion held by some tribes but not by others. Islamic law based on the Quran and Sunnah is common to all and is equally applicable to the members of the society from the lowest to the highest level, without any distinction or discrimination

The Prophet was asked to declare that:

I have been commanded to maintain justice between you. [12]

The Prophet admonished that:

The nations before you were destroyed because they would punish the lower class criminals according to the law but would let go those from the higher class.

Then laying further emphasis, He continued by stating that:

I swear by the Authority in whose control is Mohammad’s life, if Mohammad’s daughter is guilty of stealing, I would cut her hand off.37

Therefore, all the personal, civil, political, social, cultural and economic rights of an individual are guaranteed under Islamic law. Everyone has equal rights and is equally responsible before the law. It is the duty of government to ensure that every member of society, particularly the poor, given its right time.


It is permissible to make the head of state and the head of government responsible for their acts. Statute on the question of the permissibility of calling heads of state to account varies from state to state in the modern system of government. Some state Constitution provides that heads of state are not subject to blame for the actions and behavior even though he violated the law, whereas, according to the Islamic constitution, there is no difference between the heads of state and other individuals in the accountability for violating the law.

Al-amr bil maruf wa nahi an al-munkar

This literally means ‘commanding what is right and forbidding what is wrong and encompasses a whole gambit of duties and responsibilities’.

The Quran makes it the mission of its believers:

You are the best of Peoples evolved for humankind, enjoining what is right and forbidding what is wrong and believing in Allah. [13]

This means that every individual in the society has the right, nay the duty, to tell the truth and to stand for it, to further all that is good and virtuous and do his or her utmost to remove the wrongs and vices wherever he or she finds them.

The Prophet tells us that:

Whoever among you sees a vice (or wrong), he should change it with his hands; if he is not able to do that, then he should check it with his tongue; and if he cannot do that, then he should consider it bad in his heart (and wish for its removal) and this is the sign of weakest in faith. [14]

A famous hadith states as follows:

The best Jihad is to say what is just (or truth) in the face of a tyrant. [15]

Yet another hadith states that:

When people see a tyrant and do not hold his hands, it is not far that Allah (SWT) sends a common punishment on them. [16]

Thus the above hadith categorically emphasised its importance.

Islamic Banking in Brunei

Having moved early to establish Shariah-compliant services, the Sultanate was now in a position to carve a niche for itself as a center for Islamic banking. However, the industry must address a number of challenges, led by the shortage of skilled labor, if it is to fully support the development of the segment.

In mid-October, Standard Chartered Bank Brunei (SCB) said it was mulling plans to introduce Islamic banking products this year to meet increased demand for syariah-compliant banking services in Brunei. The announcement followed the September launch of the Islamic Bank of Brunei, which replaced the International Bank of Brunei as the sole domestically owned bank in the country.

The Tabung Amanah Islam Brunei was launched in 1991 and was the first financial institution to offer savings and financing in accordance with Islamic principles. It was followed two years later by the Islamic Bank of Brunei. They were joined in 2000 by the Islamic Development Bank of Brunei.

Standard Chartered Bank Brunei CEO Lai Pei-Si told the media in October that launching an Islamic bank was a “logical step to take and a logical step to consider because Brunei has an express need for Islamic banking products”. He added that the bank would begin modestly by offering Islamic products, with hopes of bringing “much more comprehensive Islamic solutions into the country”.

In April, the managing director of Bank Islam Brunei Darussalam, Javed Ahmad, said the market share held by syariah-compliant banking was expected to increase to 60 per cent from its current levels of 40-55 per cent over the next five years.

At a seminar on Islamic finance, Ahmad said Brunei Darussalam’s strengths, led by strong economic and political stability, good infrastructure and government support, meant it was well placed to build a reputation as an Islamic financial centre.

“With more aggressive marketing, Brunei Darussalam’s journey towards making itself an Islamic financial hub might become a possibility in the next few years,” he said.

A report in December by global consultancy Ernst & Young said the worldwide value of Islamic banking would reach US$1.55 trillion in 2012 and US$1.8 trillion this year. Growth in Muslim communities in the Middle East, North Africa and Asia were key drivers in the rising demand for Islamic financial services, it said.

The Sultanate is benefiting from early participation in the Islamic banking segment, having launched its first Islamic bond, the Short Term Government Sukuk Al-Ijarah programme worth $150 million for a three-month certificate in April 2006.

In November, Autoriti Monetari Brunei Darussalam (AMBD, which acts as central bank), announced the successful pricing of its 82nd issuance of sukuk or Islamic bonds, worth $100 million at a rental rate of 0.16 per cent. The move followed a $100-million, 90-day issuance that matures this month.

Although Brunei Darussalam is well positioned to capitalize on growing interest in Islamic finance, observers have emphasized the need for the Sultanate to develop Islamic banking products are new if it is to maintain its position in the market.

“Understanding the theory of Maqasid al-Syariah (the objectives of Islamic law) and the defining characteristics of an Islamic bank could encourage the Islamic banking industry to improve and excel in their product innovation as well as financial inter-mediation that can be linked to economic growth,” Abdul Ghafar Ismail, a lecturer at the Research Centre for Islamic Economics and Finance, Universiti Kebangsaan Malaysia, said at a conference last May.

Industry experts believe Brunei addressing these challenges, with an emphasis on staff training after human resources has been identified as a factor that may limit the success.

“Having strengthened its operational base and regulatory framework, Brunei is now taking steps to address a shortage of trained industry professionals in the Islamic financial sector by providing on-the-job training and local universities offering bachelors, masters and doctorate degree programmes related to Islamic finance,” said Javed.

Early entry into the Islamic financial services market by the Sultanate had provided it has a solid foundation to develop the industry. Experts suggest the focus should now shift to export expertise and strengthening the global role of the Sharia Islamic banking.

Concept Of Riba
Riba in Malaysia

Riba is a transaction contract between 2 or more parties. Therefore, it is an agreement which is enforceable by law. [17] So, when an agreement is not capable of being enforced, it is said not to considered as a contract. [18] Even though there could be contract between the parites, the law had laid down certain situation where the contract will be invalidated based on circumstances.

Section 24 of the Contracts Act describes a void contract as any agreement or contract, the object or consideration of which is forbidden by law, is such a nature that if permitted by law will defeat the law; is fraudulent; it involves implied injury to the person or property of another; or is regarded as immoral or opposed to public policy by the court. Thus, in all the above circumstances, the courts are requested to declare the agreement as illegal and therefore void; having no effect whatsoever. [19] The Act further provides for instances or grounds where an agreement will be regarded to be void.

The Act provides as follows:

The considerations and objects of an agreement are lawful, unless —

(a) it is forbidden by law;

(b) it is such a nature that, if permitted, it would defeat any law;

(c) it is fraudulent;

(d) it involves or implies injury to the person or property of another; or

(e) the court regards it as immoral, or opposed to public policy.

The above cases show that the consideration or the object of the consideration is said to be unlawful. In situation where the consideration is said to be unlawful, the contract is void

The main part shall be on S24(b) and a‚¬ of the contract Act. The court had the power to declare any riba transaction to be void it such situation had been brough to the civil court. If the riba based agreement is allowed, this would defeat any law and also the constitution too. This argument falls unequivocally on S.24(b) of the Contract Act. Besides that, a riba based agreement if allowed would defeat A.3 of the Federal constitution as well. The courts can therefore rely on this provision to declare a riba-based transaction or agreement void.

The combination of the two provisions of the law is sufficient for the court to declare that riba based agreement, would defeat A.3 of the Fedeeal Constitution. This interpretation is in line with the principle that the constitution should not be read in isolation but rather it must be interpretaed in a way that it would give life and meaning to other provision of the law.

The second argument that could be raised by the court in invalidating riba based transaction is the ground of public policy. This is coverd by S,24(e) of the Contract Act.

The question now is what is public policy and what is public policy in Malaysia.. It has been viewed in one quarter as the broad framework of ideas and values within which decisions are taken and action, or inaction, is pursued by governments in relation to an issue or problem. [20] It has also been seen as a proposed course of action of a person, group or government within a given environment, providing obstacles and opportunities which the policy was proposed to utilise and overcome in an effort to reach a goal or realise an objective or purpose. [21] Furthermore, it is also a commitment to a course or plan of action agreed to by a group of people with the power to carry it out. [22]

It is also seen as whatever governments choose to do or not to do. [23] It can also mean an agreement that injures public welfare, morals or health. [24] It also means policy of the law and is applicable to the spirit and letter of the law. [25] It is also seen as principles according to which actions of men and communities need to be regulated to achieve the good of the entire community or public. [26] It has been seen as principles and standards regarded by the Legislature or by the courts as being a fundamental concern to the state and the whole of the society and things that can injure the public at large. [27] It further refers to the art of ruling wisely and to matters which the Legislature or the court regards as fundamental concern to the state and to the whole society. [28] It connotes an overriding public interest that may justify the court’s decision to declare a contract void. [29]

From all the definition of ‘Public policy which had been defined above, oine could reasonably concluded that public policy includes the state ideology, the state objectives and plan, the values and fundamental concerns of the state, the legal policy of the state in terms of spirit and letters of the law, the overriding public interest and principles regulating the affairs of the state to achieve good for the community.

Regarding the second question which is regarding public policy in Malaysia, it is to be said that Islam is considered as the public policy in Malaysia. The religion of Islam being the public policy of Malaysia is evident in art 3 of the Constitution which declares Islam as the religion of the federation. It was made so important to the extent of having it stated in art 3 of the Constitution. It is also evident in the careful drafting of art 4(1) to exclude Islam from a law that may be rendered void for being inconsistent with the provision of the Constitution. [30] One can also clearly see the public policy in the nature of oath being taken by the Sultan and Yang di-Pertuan Agong. [31] This can also be seen in the definition of who is Malay. [32] It can also be seen in art 74(2) which gives the state the powers to make laws in Islamic matters. On the other hand, the population of muslim had overridden the number of other religion in Malaysia. In addition to that, Muslims also represent the majority in political positions including that of the states of the Federation.

Having affirmed that Islam remains as the major public policy of Malaysia, it is clear for the court to nullify riba based agreement nor transaction to be contradict with the public policy of Malaysia which is under S.24a‚¬ of the Contract Act and A.3 of the Federal Constitution.

There are certain objection that had been raised which is one could be said to have the intention to impose Shariah principle on every citizens in this country including those who are of different religion.. This argument may not hold water because this is nothing but pure interpretation of the existing laws of the country namely the Contracts Act and the Constitution. Secondly, it is natural that a law usually emerges anywhere in the world as a result of the political, social, religious and sometimes even for selfish reasons. It is a product of the cultural norms, social status and public policy of a nation and this perhaps led to the emergence of Islam as the religion of the federation. Even the Central Bank Act of Malaysia enjoins the bank to promote the interest of the country. [33] It is submitted here that allowing a riba-based transaction is even not in the interest of the country, No matter how it is looked at, A.3 of the Federal constitution is already in existence and the best solution for it is to interpreted it in a way that it gives life and meaning to the provision Moroever, invalidating riba based transaction on the grounds of public policy is equivalent to circumstances where the court declares an agreement void due to the reason of it is against morality

Riba in Brunei

Throughout the history there are people who are trying to justify riba. There is a writer saying that: “We can state that there will be no Islamic pre-eminence without achieving economic pre-eminence. Besides that, is it to said that there could not be any pre-eminence without establishing any fininacial institution which dould not function without relying in interest (Riba/ usury)”

The muslim ummah is permited to build up their own economies by way of using the means that Allah had allowed for them.

Economic strength enables the Ummah to perform what Allah had permitted to them and what had been forbidden to them. Whenever a Muslim helps in preserving Allah’s command and help each other to preserve the rightenous of Islamic Law, Allah will make bless them. In addition to that, Allah will also help them in archieving their goals and stay safety.

Regarding the statement- “There can be no economic pre-eminence without ¬?nancial institutions and no ¬?nancial institutions without interest (Riba)”, they are utterly false.

This false statement had been contradicted with the Al Quran. The practices of Islamic economic where it was establish at the time of prophet until now where banks had affirmed the falsehood of this statement.

Muslim economy could said to have been the strong during the past few centuries where it does not rely neither on bank nor Riba. Besides that, throughout this time period, many Muslims w