The external environment driving internal organizational change: empirical evidence from commercial banks’ adoption of Islamic financial transactions in Libya

Gader Khalleefah Bin Idrees, Salwa Abdel and Syed Jaafar Alhabshi, Syed Musa and Ashurov, Sharofiddin and Abdullah Othman, Anwar Hasan (2021) The external environment driving internal organizational change: empirical evidence from commercial banks’ adoption of Islamic financial transactions in Libya. Journal of Islamic Finance, 10 (2). pp. 148-161. ISSN 2289−2109 E-ISSN 2289-2117

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Abstract

This paper examines the Libyan commercial banks’ adoption of Islamic financial transactions to achieve a real value for stakeholders related to internal environmental adaptation. Accordingly, a questionnaire was designed and distributed to 14 commercial banks in Libya. Structural Equation Modelling (SEM) has been employed for testing the hypotheses. In the context of hypothesized modeling, the conceptual framework portrayed the constructs of the variables employed in the study to be Libyan commercial banks’ adoption of financial transactions as the dependent variable and the external environment as factors driving organizational change as the independent variable. The adaptation of the commercial banks’ internal environment acts as a mediating variable. The Confirmatory Factor Analysis (CFA) is applied to the relationship between measures of constructs and indicators. The results showed that the estimations of maximum likelihood (ML) were satisfactory. The results of SEM showed that commercial banks’ adoption of Islamic financial transactions is more related to their capability of adapting their internal environment than achieving an economic and social value of stakeholders. Finally, the article provides future research directions on commercial banks’ ability to adapt to their internal environment to drive change and commercial banks’ adoption of Islamic financial transactions.

Item Type:	Article (Journal)
Additional Information:	8755/96073
Uncontrolled Keywords:	adoption, adaptation, change, stakeholder, neo-institutional theory, Islamic banking
Subjects:	BPH Islamic Economics H Social Sciences > HG Finance H Social Sciences > HG Finance > HG3368 Islamic Banking and Finance
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Institute of Islamic Banking & Finance (IIiBF)
Depositing User:	Dr Sharofiddin Ashurov
Date Deposited:	05 Jan 2022 14:46
Last Modified:	05 Jan 2022 14:46
URI:	http://irep.iium.edu.my/id/eprint/96073

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