Model of Good Corporate Governance and Islamic Organizational Culture in Improving Employee Performance through Job Satisfaction

Abstract

The implementation of good corporate governance and organizational culture based on Islamic values plays an important role in improving employee performance at Islamic banking institutions. In other words, good corporate governance and culture in an Islamic organization can maintain the sustainability of the company in achieving the company's vision and mission. This study aims to determine and analyze the effect of the implementation of GCG principles and Islamic organizational culture on employee performance through job satisfaction in employees of Islamic banking institutions in Bandung City with 118 samples. In this study, all target populations will be sampled using non-probability sampling techniques with convenience sampling methods using survey and verification methods with a quantitative approach. The research data were obtained from a questionnaire and tested using SmartPLS version 3.0 software with the Partial Least Square (PLS) method which is one of the alternative Structural Equation Modeling (SEM) methods. From the data analysis that has been done, it shows that: (1) Implementation of GCG principles has a positive and significant effect on job satisfaction, (2) Implementation of Islamic organizational culture has a significant positive effect on job satisfaction, (3) Implementation of GCG principles has a positive and significant effect on employee performance, (4) Implementation of Islamic organizational culture has a positive and significant effect on employee performance, (5) Job satisfaction has a positive and significant effect on employee performance, (6) Job satisfaction is able to mediate the relationship between the implementation of GCG principles on employee performance, and (7) Job satisfaction is unable to mediate the relationship between the implementation of Islamic organizational culture on employee performance.

Keywords: Implementation of Good Corporate Governance (GCG), Implementation of Islamic Organizational Culture, Employee Performance, Job Satisfaction

DOI: 10.7176/RJFA/15-7-02

Publication date: July 30th 2024