MODELING RIBA-FREE CIRCULAR ECONOMY: A STRATEGIC ROADMAP FOR SUSTAINABLE RESOURCE MANAGEMENT IN MUSLIM-MAJORITY COUNTRIES
Article Sidebar
-
Circular Economy, Muslim-Majority Countries, Riba-Free Economy
Abstract
The growing urgency of environmental degradation and resource inefficiency has intensified the search for sustainable economic models that are not only environmentally sound but also ethically grounded. In Muslim-majority countries, sustainability initiatives often face structural tension due to reliance on interest-based financial systems that conflict with Islamic economic principles, particularly the prohibition of riba. This study aims to develop a conceptual model of a riba-free circular economy and to formulate a strategic roadmap for sustainable resource management that aligns circular economy principles with Islamic economic ethics. The research adopts a qualitative–conceptual design supported by systematic analysis of secondary data, policy documents, and comparative case studies from selected Muslim-majority countries. Conceptual modeling and analytical synthesis are employed to integrate circular economy mechanisms with riba-free financial instruments and governance structures. The findings demonstrate a strong normative and operational compatibility between Islamic economic principles and circular economy objectives, particularly in promoting long-term investment, risk-sharing, and real-sector engagement. The proposed strategic roadmap highlights the roles of regulatory alignment, Islamic finance innovation, and institutional coordination in operationalizing sustainable resource management. The study concludes that a riba-free circular economy constitutes a viable and contextually relevant pathway for advancing sustainability in Muslim-majority countries, offering both theoretical enrichment and practical guidance for policymakers and practitioners.
Full text article
References
Afdawaiza, A., Supriani, I., & Yusfiarto, R. (2025). Catalyzing Muslim women-owned Halal SMEs: Aligning models of Islamic financial institutions and governmental involvement. Social Sciences & Humanities Open, 12, 102042. https://doi.org/https://doi.org/10.1016/j.ssaho.2025.102042
Aisyah, M., Sesunan, Y. S., & Wicaksono, A. T. S. (2025). Customers’ trust in Islamic banking post-cyberattack leads to digital service breakdowns in Indonesia. Sustainable Futures, 10, 101530. https://doi.org/https://doi.org/10.1016/j.sftr.2025.101530
Alghafes, R., Karim, S., Aliani, K., Qureishi, N., & Alkayed, L. (2024). Influence of key ESG factors on Islamic banks’ financial performance: Evidence from GCC countries. International Review of Economics & Finance, 96, 103629. https://doi.org/https://doi.org/10.1016/j.iref.2024.103629
Ariatin, A., Dhewanto, W., & Yudha, O. (2023). Entrepreneurial Muslim leadership in Islamic cooperative business unit. Journal of Islamic Accounting and Business Research, 15(3), 499–518. https://doi.org/https://doi.org/10.1108/JIABR-04-2022-0100
Arissaputra, R., Gaffar, V., Sultan, M. A., Andriana, D., Abror, A., Sentika, S., & Christiyanto, W. W. (2025). Muslim tourists as role models for environmental responsibility: key factors in memorable nature-based tourism, place attachment, and environmental concern. Journal of Islamic Marketing, 16(12), 3657–3681. https://doi.org/https://doi.org/10.1108/JIMA-11-2024-0541
Asyari, A., Susanto, P., Hoque, M. E., Widianita, R., Alam, M. K., & Mamun, A. Al. (2023). Food waste behavioral intention in Islamic universities: the role of religiosity and pro-social behavior. International Journal of Ethics and Systems, 41(4), 840–866. https://doi.org/https://doi.org/10.1108/IJOES-10-2023-0231
Bakhshizadeh Borj, K., Bashirpour, M., Javanshir, N., & Jahedi, P. (2025). The hidden dimensions of halal brand: examining the role of frugality in consumer purchase decisions. Journal of Islamic Marketing, 16(10), 2968–2985. https://doi.org/https://doi.org/10.1108/JIMA-11-2024-0529
Bouteraa, M., Chekima, B., Amin, H., Tamma, E., Lada, S., Ansar, R., & Lim, M. F. (2024). Does consumer religiosity matter for green banking adoption? Evidence from a Muslim-majority market. Journal of Islamic Marketing, 15(7), 1807–1823. https://doi.org/https://doi.org/10.1108/JIMA-02-2023-0049
Chaouali, W., Haddoud, M. Y., Mousa, M., Elbaz, A. M., Aloui, N., & Dekhil, F. (2024). Understanding Muslim frontline employees’ perceived religious discrimination and emotional exhaustion. Journal of Services Marketing, 38(6), 731–745. https://doi.org/https://doi.org/10.1108/JSM-08-2023-0312
Daly, S., & Jarboui, S. (2025). Aligning financial development with environmental sustainability in Saudi Arabia: Evidence from Islamic finance and renewable energy investment. Sustainable Futures, 10, 101542. https://doi.org/https://doi.org/10.1016/j.sftr.2025.101542
Elsotouhy, M. M., Mobarak, A. M. A., Dakrory, M. I., Ghonim, M. A., & Khashan, M. A. (2023). Integrating ISS and SOR models to investigate the determinants of continuance intention toward using m-payment for donations (Sadaqah): the moderating role of Islamic religiosity. International Journal of Bank Marketing, 41(7), 1640–1670. https://doi.org/https://doi.org/10.1108/IJBM-11-2022-0498
Ergen Kele?, F. H., Kele?, E., & Schlegelmilch, B. B. (2025). CSR news and stock prices: A fine-grained analysis in an underexamined Muslim setting. Emerging Markets Review, 67, 101301. https://doi.org/https://doi.org/10.1016/j.ememar.2025.101301
Fathoni, M. A., Rodoni, A., Al Arif, M. N. R., & Hidayah, N. (2025). Intention to participate in Islamic banking in Indonesia: Does socio-political identity matter? Journal of Islamic Marketing, 16(7), 1844–1859. https://doi.org/https://doi.org/10.1108/JIMA-12-2023-0397
Haddou, S., & Boughrara, A. (2025). How diversification shapes full-fledged Islamic bank Stability? A causal inference approach. International Review of Economics & Finance, 102, 104367. https://doi.org/https://doi.org/10.1016/j.iref.2025.104367
Hapsari, M. I., Mahmud, A. H., Herianingrum, S., Fauzy, R. M. Q., Ab. Hamid, S. N., Prabaswara, A., & Masfiyah, L. M. (2024). Antecedents of Islamic welfare: productivity, education, and the financial aspect. International Journal of Islamic and Middle Eastern Finance and Management, 17(1), 63–85. https://doi.org/https://doi.org/10.1108/IMEFM-07-2022-0299
Haqpana, S., & Tsouroufli, M. (2023). ‘Powerless, poor and needy?’: Reproducing colonial discourses of gender and Muslim women through educational interventions by I-NGOs in Afghanistan. Women’s Studies International Forum, 98, 102714. https://doi.org/https://doi.org/10.1016/j.wsif.2023.102714
Hatem Falih, O., Abedin, B., Yahyazadehfar, M., Safari, M., & Kassim, E. S. (2025). Exploring customer loyalty in Islamic banking: a model for the Iraqi market. Journal of Islamic Marketing, 16(9), 2543–2568. https://doi.org/https://doi.org/10.1108/JIMA-04-2024-0148
Ishak, A. H., Amira Mohamad, S. N., Ab Manan, S. K., Yahaya, M. H., Wan Daud, W. N., & Sharif, D. (2025). The critical success factors of waqf land development for sustainable agriculture. Social Sciences & Humanities Open, 11, 101244. https://doi.org/https://doi.org/10.1016/j.ssaho.2024.101244
I??k, Ö., Adalar, ?., & Shabir, M. (2025). Measuring efficiency, productivity and sustainability performance for ?slamic banks: a fuzzy expert-based multi-criteria decision support model using spherical fuzzy information. International Journal of Islamic and Middle Eastern Finance and Management, 18(6), 1482–1519. https://doi.org/https://doi.org/10.1108/IMEFM-09-2024-0477
Islam, M. M. (2025). Halal supply chain management readiness and halal cosmetics in Bangladesh. Journal of Islamic Marketing, 16(8), 2148–2186. https://doi.org/https://doi.org/10.1108/JIMA-05-2022-0130
Jan, A., Rahman, H. U., Zahid, M., Salameh, A. A., Khan, P. A., Al-Faryan, M. A. S., Che Aziz, R. B., & Ali, H. E. (2023). Islamic corporate sustainability practices index aligned with SDGs towards better financial performance: Evidence from the Malaysian and Indonesian Islamic banking industry. Journal of Cleaner Production, 405, 136860. https://doi.org/https://doi.org/10.1016/j.jclepro.2023.136860
Javid, F., Gul, A., Naz, I., & Ali, M. (2024). Do Islamic work ethics matter? Impact of aversive leadership on employees’ emotional and psychological health through the lens of conservation of resource theory. Sustainable Futures, 8, 100309. https://doi.org/https://doi.org/10.1016/j.sftr.2024.100309
Mahmoud, M. A., Umar, U. H., Ado, M. B., & Kademi, T. T. (2023). Factors influencing the financial satisfaction of MSME owners: the mediating role of access to Islamic financing. Management Research Review, 47(3), 422–440. https://doi.org/https://doi.org/10.1108/MRR-01-2022-0047
Mahmoud, M. A., Umar, U. H., Danlami, M. R., & Ado, M. B. (2024). An analysis of Islamic financing access in Nigeria: perspectives of MSME owners. International Journal of Islamic and Middle Eastern Finance and Management, 18(1), 49–67. https://doi.org/https://doi.org/10.1108/IMEFM-02-2024-0072
Maryam, S. Z., Saleem, M., Ahmad, A., & Shaheen, W. A. (2025). Leveraging information systems for competitive advantage: a study of Islamic financial institutions’ innovativeness and agility for Fintech financing. Journal of Islamic Marketing, 16(12), 3711–3735. https://doi.org/https://doi.org/10.1108/JIMA-07-2024-0299
Mawardi, I., Al Mustofa, M. U., Widiastuti, T., & Ghozali, M. (2024). The influence of institutional quality, economic freedom, and technological development on Islamic financial development in OIC countries. Journal of Open Innovation: Technology, Market, and Complexity, 10(2), 100279. https://doi.org/https://doi.org/10.1016/j.joitmc.2024.100279
Mboutchouang Kountchou, A., Haruna, A., & Tadzong Mouafo, P. (2025). Patronizing Islamic finance services by Cameroonian small and medium-sized entrepreneurs: examining the level and the role of Islamic finance awareness. International Journal of Islamic and Middle Eastern Finance and Management, 18(4), 747–764. https://doi.org/https://doi.org/10.1108/IMEFM-02-2024-0076
Meskovic, A., Avdukic, A., & Kozarevic, E. (2024). Assessing the impact of external determinants on the social performance of Islamic banks. International Journal of Islamic and Middle Eastern Finance and Management, 17(1), 124–145. https://doi.org/https://doi.org/10.1108/IMEFM-08-2022-0335
Mujiatun, S., Trianto, B., Cahyono, E. F., & Rahmayati, R. (2025). The effects of Islamic financial literacy on entrepreneurial venture performance and halal tourism ecosystem development. Journal of Small Business and Enterprise Development, 32(6), 1250–1284. https://doi.org/https://doi.org/10.1108/JSBED-03-2023-0108
Nasih, M., Ardianto, A., Cahyono, S., Sulaiman, N. A., & Noman, A. H. M. (2025). Sharia Supervisory Board accounting background, cross-membership, and cost of equity capital: evidence from worldwide Islamic banking. International Journal of Islamic and Middle Eastern Finance and Management, 18(6), 1454–1481. https://doi.org/https://doi.org/10.1108/IMEFM-10-2024-0485
Nawaz, M., Zhang, L., & Hanif, M. W. (2025). Motivators of sustainable responsible consumption behaviour: a sequential mediation. Journal of Islamic Marketing, 16(10), 2986–3012. https://doi.org/https://doi.org/10.1108/JIMA-12-2023-0406
Okumu?, H. ?., & Gümü?, M. A. (2025). Revitalizing “mahr” for Muslim women’s empowerment within Türkiye’s secular legal system. Social Sciences & Humanities Open, 12, 101644. https://doi.org/https://doi.org/10.1016/j.ssaho.2025.101644
Ooi, C.-A., & Hooy, C.-W. (2025). Are Muslim CEOs pursuing intangible value creation over profitability? International evidence. International Journal of Islamic and Middle Eastern Finance and Management, 18(4), 835–856. https://doi.org/https://doi.org/10.1108/IMEFM-08-2023-0276
Pusparini, M. D., Bonang, D., Virgiawan, R., Sukmana, R., Lahuri, S. bin, & Fedro, A. (2024). Does religiosity affect green entrepreneurial intention? Case study in Indonesia. Journal of Islamic Marketing, 16(2), 548–575. https://doi.org/https://doi.org/10.1108/JIMA-12-2023-0419
Qureshi, R. A., Dada, Z. A., Bhat, W. A., & Soudager, M. A. (2025). Modelling halal tourism as a reflective–reflective second-order construct: linking attributes to tourist outcomes using structural model analysis. Journal of Islamic Marketing, 16(10), 2733–2780. https://doi.org/https://doi.org/10.1108/JIMA-07-2024-0289
R.V., S., Annamalai, B., & Chandrasekaran, S. (2024). Consumer behavior in Islamic banking: a systematic literature review and agenda for future research. Journal of Islamic Marketing, 15(5), 1326–1349. https://doi.org/https://doi.org/10.1108/JIMA-06-2023-0195
Rafiki, A., Mohd Subri, I., Mohiddin, M. N., Hidayat, S. E., & Mohd Salleh, M. M. (2025). Salient practices of halal management in Southeast Asia: a systematic literature review. Journal of Islamic Marketing, 16(7), 1821–1843. https://doi.org/https://doi.org/10.1108/JIMA-02-2024-0059
Riaz, U., Burton, B., & Fearfull, A. (2023). Emotional propensities and the contemporary Islamic banking industry. Critical Perspectives on Accounting, 94, 102449. https://doi.org/https://doi.org/10.1016/j.cpa.2022.102449
Rofik, M., Boulanouar, Z., Yuli, S. B. C., & Wardani, D. T. K. (2025). Revisiting the impact of Islamic finance on economic growth: a decomposition analysis using Indonesia as a testing ground. International Journal of Islamic and Middle Eastern Finance and Management, 18(4), 765–786. https://doi.org/https://doi.org/10.1108/IMEFM-06-2024-0288
Sari, R. K., Alfarizi, M., & Ab Talib, M. S. (2024). Sustainable strategic planning and management influence on sustainable performance: findings from halal culinary MSMEs in Southeast Asia. Journal of Modelling in Management, 19(6), 2034–2060. https://doi.org/https://doi.org/10.1108/JM2-12-2023-0324
Sharif, K., & Faisal, M. N. (2025). Mapping an Islamic venture capital setup using foresight-based social construction approach. International Journal of Islamic and Middle Eastern Finance and Management, 18(4), 787–812. https://doi.org/https://doi.org/10.1108/IMEFM-03-2024-0141
Shikur, A. A., & Akkas, E. (2024). Islamic microfinance services: a catalyst for poverty reduction in eastern Ethiopia. International Journal of Islamic and Middle Eastern Finance and Management, 17(4), 770–788. https://doi.org/https://doi.org/10.1108/IMEFM-09-2023-0327
Siddiqui, S., Sujood, Nafees, S., & Hamid, S. (2024). Deciphering the role of perceived discrimination, perceived islamophobia and religiosity in affecting Muslim women’s intention of working in the tourism and hospitality (T&H) industry. Journal of Islamic Marketing, 16(2), 576–605. https://doi.org/https://doi.org/10.1108/JIMA-12-2023-0414
Suhartanto, D., Brien, A., Amalia, F. A., Sumarjan, N., Awang Razli, I., & Sutrisno, R. (2024). Driving young Muslim loyalty toward Muslim-majority tourism destinations: the sense of community theory perspective. Journal of Islamic Marketing, 15(5), 1396–1413. https://doi.org/https://doi.org/10.1108/JIMA-05-2023-0150
Sumi, A. A., Ahmed, S., & Alam, S. S. (2024). Islamic teachings and environmental corporate social responsibility in Bangladesh: a mixed-methods research approach. Journal of Islamic Marketing, 15(4), 1155–1182. https://doi.org/https://doi.org/10.1108/JIMA-09-2023-0271
Timur, Y. P., Ridlwan, A. A., Rahim, S. A., Fikriyah, K., Susilowati, F. D., Canggih, C., Nurafini, F., & Badrul Munir, M. B. (2025). Determinants of Muslim investors in investing through green sukuk retail: an extended pro-environmental planned behavior approach. Journal of Islamic Marketing, 16(8), 2403–2432. https://doi.org/https://doi.org/10.1108/JIMA-07-2024-0286
Tumewang, Y. K., Ayunda, K. P., Azzahra, M. R., & Hassan, M. K. (2024). The effects of diversity and inclusion on ESG performance: A comparison between Islamic and conventional banks. Borsa Istanbul Review, 24(6), 1101–1110. https://doi.org/https://doi.org/10.1016/j.bir.2024.10.001
Xiong, J., & Chia, K. W. (2024). Beyond halal: exploring Muslim and non-Muslim tourists’ halal food experiences. Journal of Islamic Marketing, 15(4), 1136–1154. https://doi.org/https://doi.org/10.1108/JIMA-04-2023-0134
Yusmazida, M. Y., Omar, M. K., Yusliza, M. Y., Samad, S., & Abdul Mokmin, K. (2025). Developing an Islamic structural capital model: perspectives from SMEs. Journal of Islamic Marketing, 16(11), 3413–3455. https://doi.org/https://doi.org/10.1108/JIMA-06-2024-0238
Zafar, M. B., & Abu-Hussin, M. F. (2025). Faith, growth, and ethics: cross-cultural analysis of religiosity and environment protection vis-a-vis economic priorities among Muslims. Journal of Environmental Psychology, 106, 102716. https://doi.org/https://doi.org/10.1016/j.jenvp.2025.102716
Authors
Copyright (c) 2026 Amin Zaki, Ali Khan, Saiful Fallah, James Smith
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
