Optimizing Risk Management in Islamic Banks through the Maqasid Syariah Principle in Supporting Sustainable Economic Growth

Abstract

This study aims to analyze how the principles of Maqasid Syariah can be used as a strategic framework in optimizing risk management in Islamic banks, in order to support sustainable economic growth that is inclusive, equitable, and in line with Islamic values. Using a qualitative approach and in-depth literature analysis, this study shows that Maqasid Syariah-which includes the protection of religion, life, mind, descendants, and property-provides a strong moral and philosophical foundation for designing a risk management system that is not only technically efficient, but also socially and environmentally responsible. Through the integration of Maqasid Syariah principles in the process of identifying, evaluating, mitigating, and monitoring risks, Islamic banks can move away from an excessive decommercialization approach and instead build a more balanced financial ecosystem. The study highlights the importance of the "5C" approach (Character, Capacity, Capital, Collateral, Conditions) enriched with ethical and general welfare (maslahah) dimensions, as well as the role of Islamic Corporate Governance (ICG) and Islamic Intellectual Capital in optimizing risk management holistically. The results of the study show that the application of Maqasid Syariah in risk management consistently supports economic sustainability, encourages compliance with sharia principles, while strengthening customer and stakeholder trust. Case studies from institutions such as Bank Syariah Indonesia (BSI) and Bank Mega Syariah demonstrate that this approach is able to create synergy between business growth, social good, and environmental protection — key values in sustainable development.