Purpose ― Understanding how Environmental, Social, and Governance (ESG) practices interact with firm value within the framework of Sharīʿah compliance is essential, as Islamic capital markets integrate financial objectives with ethical and sustainable principles. The present study focuses on the bidirectional relationship between ESG performance and firm value. It investigates the moderating role of Sharīʿah compliance and examines the effect of external governance mechanisms on ESG practices in Sharīʿah-compliant firms in the context of Indonesia.

Design/Methodology/Approach ― The final sample consists of 155 public firms listed in the Indonesia Sharia Stock Index (ISSI). Structural Equation Modelling using Partial Least Squares (SEM-PLS) is employed to test the hypothesised relationships.

Findings ― The study finds a significant negative effect of ESG performance on firm value, suggesting that ESG investments may incur short-term costs that reduce immediate market valuation. In contrast, firm value significantly and positively influences ESG performance, indicating that firms with stronger financial standing are more likely to invest in sustainability initiatives. While Sharīʿah compliance does not moderate the relationship between ESG and firm value, it was found that it positively affects ESG engagement, reflecting the close alignment of Islamic values with sustainability. The study also reveals that external governance factors do not have a significant impact on ESG performance.

Originality/Value ― This study extends prior ESG research by modelling the ESG-firm value relationship as a bidirectional process and introducing Sharīʿah compliance as a moderator variable, thereby offering new insights into ethical investing and sustainable finance in Islamic capital markets.

Research Limitations/Implications ―  The study adopts a cross-sectional design, which limits the ability to capture longitudinal dynamics and sectoral variations.

Practical Implications ― The study offers practical insights for managers, regulators, and investors by demonstrating how ESG engagement with Sharīʿah constraints may involve short-term value trade-offs while shaping sustainability outcomes in Islamic capital markets.

Good Corporate Governance (CG) ensures the availability of better accounting information with higher transparency and accountability. Implementation of good CG in Islamic stock issuers should have a more positive impact than nonIslamic stock issuers as the former are selected based on a strong financial fundamental. This study aims to empirically examine the impact of CG on earnings quality. It also examines the impact of earnings quality on firm’s value. Thus earnings quality is considered as a mediating variable. This study uses the Structural Equation Model (SEM)-Partial Least Square (PLS). The final sample consists of 58 firms-years listed in Jakarta Islamic Index (JII) from 2008 to 2015. The study found that CG directly affects firm value with a positive direction. CG also increases earnings quality. The better the quality of CG, the better the quality of earnings. Then earnings quality increases firm value. In summary, earnings quality partially mediates the relationship between CG and firm’s value. This study uses the Corporate Governance Performance Index (CGPI) published by IICG (the Indonesian Institute for Corporate Governance) as the indicator of corporate governance quality. Predictability, neutrality, timeliness, and earning smoothness are used as the indicators of earnings quality. Tobin’s Q and corporate social performance represent firm value.

Purpose – This study aims to provide empirical evidence on the contingency factors that affect the implementation of education strategies and the impact of education strategy misfit on the performance and effectiveness of the board’s moderating role on the misfit level and performance of Islamic banks. Design/methodology/approach – This research is a quantitative study with pooled ordinary least square panel data during the years 2007-2014 from all Indonesian Islamic commercial banks. Islamic bank performances are measured by the level of profitability and sharia financial performance. Board effectiveness is analysed by measuring the effectiveness of both the board of commissioners (BoC) and the sharia supervisory board (SSB). Findings – This study proves that organisational competent qualities and chief executive officer tenure are the contingency factors that affect the implementation of the education strategy. This study’s results indicate that the effectiveness of both the BoC and SSB has a positive impact on the bank’s profitability and sharia financial performance. The results also show that misfit has a negative effect on sharia financial performance and that board effectiveness is proved to reduce the negative impact of a misfit on sharia financial performance. However, there is no strong evidence that board effectiveness reduces the negative impact of a misfit on profitability. Originality/value – This study emphasises the importance of enhancing the competence and innovation of organisations in the implementation of education strategy and the need for synergy and increased capabilities among board members to achieve well-established Islamic bank performance