Halal Brand Assurance through AI-Powered Leadership Engagement: A Study of Malaysian Franchises
DOI:
https://doi.org/10.24191/eaj.v14i2.7209Keywords:
Halal brand assurance, artificial intelligence,, leadership engagement, shariah governance, franchise compliance, Maqasid al-ShariahAbstract
This study explores how Artificial Intelligence (AI) can enhance halal brand assurance in Malaysian franchise operations by examining the mediating role of leadership engagement. A quantitative approach was employed, involving a structured survey of 150 halal-certified franchise operators. Data were analysed using SmartPLS 4.0 and Structural Equation Modeling (SEM) to evaluate mediation and moderation effects. Results indicate that AI-assisted compliance significantly influences halal brand assurance through the mediating role of leadership engagement (β = 0.59, p < 0.001). Institutional factors also moderate this relationship, underscoring the role of ethical leadership in translating digital compliance tools into Shariah-compliant brand practices. The study contributes to Islamic business governance by integrating Engagement Theory, Maqasid al-Shariah, and Institutional Theory. It offers empirical validation of AI’s role in franchise-level halal assurance and highlights the importance of AI-readiness and ethical leadership in supporting Shariah compliance frameworks. Practical implications are relevant for policymakers, Islamic fintech developers, and franchise managers aiming to strengthen halal brand credibility in the digital era.
References
Abdullah, A. G., Zainal, S. R., & Salleh, M. (2021). Leadership engagement and ethical franchise performance: A Malaysian perspective. Journal of Islamic Business Studies, 9(2), 115–129.
Ali, N. M., Shafie, N., & Hassan, R. (2023). Islamic fintech and the role of AI in Shariah governance: A systematic review. Journal of Islamic Monetary and Financial Studies, 4(1), 42–57.
Alsharari, N. M. (2023). Artificial intelligence applications in Islamic finance: Towards responsible automation and governance. Technological Forecasting and Social Change, 189, 122419.
Dusuki, A. W., & Bouheraoua, S. (2019). The framework of Maqasid al-Shariah in Islamic financial institutions. ISRA International Journal of Islamic Finance, 11(2), 237–251.
Elasrag, H. (2022). Halal governance in Saudi Arabia: Lessons for regulatory reform. Journal of Islamic Accounting and Business Research, 13(4), 789–803. https://doi.org/10.1108/JIABR-02-2022-0068
Farooq, M. S., & Nawaz, M. S. (2021). Spiritual leadership and ethical climate: The role of Islamic work ethics. Journal of Islamic Business and Management, 11(2), 44–61. https://doi.org/10.26501/jibm/2021.1102-004
Fischer, J., & Reiner, G. (2020). The integration of blockchain in halal supply chains: The UAE and beyond. Journal of Islamic Marketing, 11(6), 1339–1356. https://doi.org/10.1108/JIMA-07-2019-0141
Ghazali, M. R., & Yunus, N. A. M. (2023). AI and halal logistics: Integration of digital technologies in halal traceability. Technological Forecasting and Social Change, 188, 122243. https://doi.org/10.1016/j.techfore.2022.122243
Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2021). A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM). Sage.
Henseler, J., Ringle, C. M., & Sarstedt, M. (2016). Testing measurement invariance of composites using partial least squares. International Marketing Review, 33(3), 405–431.
Ismail, M. F., & Ahmad, M. A. (2022). Enhancing Shariah audit with artificial intelligence: A Malaysian perspective. ISRA International Journal of Islamic Finance, 14(2), 317–333.
Khan, S. Z., & Haleem, A. (2022). Consumer perception and brand trust in halal-certified products. British Food Journal, 124(3), 764–780. https://doi.org/10.1108/BFJ-10-2020-0945
Latif, A. A., & Zainuddin, M. Y. (2021). Institutional theory and halal compliance: A conceptual linkage with Islamic consumer trust. Journal of Islamic Marketing, 12(5), 938–954.
Mohd Noor, N. M., & Kassim, N. M. (2023). Ethical leadership and compliance in Islamic organisations: Empirical validation in Malaysia. International Journal of Ethics and Systems, 39(1), 122–137. https://doi.org/10.1108/IJOES-04-2022-0107
Rabbani, M. R., et al. (2024). The role of AI and machine learning in strengthening ethical finance: A maqasid-oriented approach. Journal of Business Ethics, 190(4), 889–905.
Saad, R. A. J., Anuar, M. A., & Jusoh, R. (2023). Halal compliance governance and digital innovation: Empirical insights from Malaysian SMEs. Journal of Islamic Marketing, 14(1), 54–72.
Tieman, M., van der Vorst, J. G. A. J., & Ghazali, M. C. (2021). Halal supply chain integration: Challenges and policy recommendations. Journal of Islamic Marketing, 12(2), 242–258. https://doi.org/10.1108/JIMA-03-2020-0084
Zainal, S. R. M., & Salleh, M. C. M. (2022). Machine learning in Islamic compliance risk detection: A framework for Malaysian financial institutions. ISRA International Journal of Islamic Finance, 14(3), 365–382. https://doi.org/10.1108/IJIF-05-2021-0095
Downloads
Published
Issue
Section
License
Copyright (c) 2025 e-Academia Journal
This work is licensed under a Creative Commons Attribution 4.0 International License.
