FROM TRANSFORMATIONAL LEADERSHIP TO SUSTAINABLE ISLAMIC CORPORATE CULTURE: EVIDENCE FROM AN INDONESIAN ISLAMIC BANK

Abstract

Organizations operating under similar Sharia governance requirements do not necessarily achieve the same depth of Islamic organizational culture, raising the question of how leader-articulated values move beyond formal compliance and become embedded practice. This study examines the organizational mechanism through which Islamic values, once articulated by leadership, are institutionalized, repeatedly enacted, and reflected in a culture that becomes progressively less dependent on any individual leader. An interpretive qualitative single-case design was conducted at PT Bank NTB Syariah, a regional development bank that completed its conversion to full Sharia operations in 2018. Data were generated through in-depth interviews with twenty purposively selected informants, participant observation across six strategic forums, and review of seven internal documents, analyzed thematically with source and method triangulation, member checking, and reflexive attention to the lead researcher's insider position. Findings show institutionalization and repeated organizational practice as interdependent, mutually reinforcing processes contributing to cultural crystallization. A subset of accounts explicitly linking self-regulation to faith points to faith-linked accountability as a candidate reinforcing mechanism. These findings are synthesized into the IMAN Model, in which leader-articulated values become embedded organizational culture when institutionalization and repeated practice reinforce one another over time, rather than through the continued presence of leadership itself. The study repositions leadership from explanatory center to initiating condition, offering an interpretive process account of value embedding with implications for how Islamic financial institutions build sustainable organizational culture beyond the tenure of individual leaders.