SHARI'AH GOVERNANCE AND RISK MANAGEMENT FRAMEWORKS IN ISLAMIC BANKING: BALANCING COMPLIANCE, FINANCIAL STABILITY AND SDGS IN SAUDI ARABIA AND NIGERIA

This study examines how Shari’ah governance (SG) and risk management (RM) frameworks interact to balance compliance with Islamic legal principles and the pursuit of financial stability in Islamic banks across two contrasting jurisdictions—Saudi Arabia and Nigeria. Adopting a qualitative research design grounded in critical content analysis (CCA), the study systematically analyzed a wide range of documents, including regulatory and institutional frameworks such as guidelines and standards issued by the Saudi Central Bank (SAMA), Central Bank of Nigeria (CBN), Islamic Financial Services Board (IFSB), and Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). Institutional documents of Islamic banks—annual reports, Shari’ah audit reports, risk management disclosures, and corporate governance statements—were examined alongside peer-reviewed journal articles, conference proceedings, dissertations, and books on Shari’ah governance and financial stability. Publications from multilateral organizations such as the Islamic Development Bank (IsDB), International Monetary Fund (IMF), and World Bank were also incorporated to enhance methodological credibility and triangulate findings. The analysis maps governance architectures, SSB roles, internal Shari’ah compliance, and enterprise risk management against key risk categories (credit, market, liquidity, operational, and Shari’ah non-compliance risk) to evaluate how these mechanisms operationalize maqāṣid al-Sharīʿah without undermining prudential soundness. The findings highlight stronger institutional integration and supervisory maturity in Saudi Arabia, contrasted with emerging regulatory capacity in Nigeria. The study contributes a comparative framework and actionable policy recommendations that strengthen Shari’ah compliance, institutional resilience, and financial inclusion aligned with SDGs 8, 9, 16, and 17. Unlike previous studies that examined Shari’ah governance or risk management in isolation, this study uniquely bridges both frameworks through a comparative evaluation of Saudi Arabia and Nigeria, linking compliance and financial stability imperatives with the pursuit of Sustainable Development Goals.