The Influence of Islamic Corporate Social Responsibility and Operational Efficiency on the Financial Performance of Bank Muamalat

Abstract

The development of sharia banking in Indonesia is driven by public awareness of financial systems aligned with Islamic principles. This study aims to analyze the influence of Islamic Corporate Social Responsibility (ICSR), proxied by Islamic Social Reporting (ISR), and Operational Efficiency measured by the Operating Expenses to Operating Income Ratio (BOPO) on the financial performance of Bank Muamalat, with Return on Assets (ROA) as the indicator. The research method employs a quantitative approach using secondary data from Bank Muamalat's quarterly financial reports for the 2017–2024 period. Data analysis was conducted using multiple linear regression. The results indicate that partially, both ISR and BOPO have a significant negative effect on ROA. Simultaneously, both variables also significantly affect ROA with a coefficient of determination of 86.3 percent. The study concludes that increases in ISR and BOPO actually reduce ROA in the short term, although good ICSR implementation has the potential to build a positive image and public trust for long-term sustainability.