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Ethical Leadership in the Sharia Perspective: The Role of Foreign CEOs and Female CEOs in the Profitability of Mining Companies

Yunus Harjito, Fadilla Nurhaliza, Widi Hariyanti, Djoko Suhardjanto

Abstract

This study examines whether the presence of foreign CEOs and female CEOs influences the profitability of mining companies listed on the Indonesia Stock Exchange (IDX). Prior research on CEO characteristics has demonstrated mixed results, particularly in emerging markets. However, limited studies integrate the analysis of CEO characteristics with Islamic business ethics, creating a research gap this study seeks to address. Using panel data from 68 mining companies over the period 2020–2024 (340 observations), this study employs a common effect model to analyze the effect of foreign CEOs, female CEOs, and leverage on profitability. The results indicate that foreign CEOs positively and significantly affect company profitability, while female CEOs do not exhibit a significant impact. This study contributes to the Islamic economics literature by discussing how leadership characteristics align with principles of amanah, professionalism, fairness, and organizational accountability in the mining sector. The implications suggest that leadership selection aligned with Islamic ethical principles may enhance organizational value and sustainability.

Keywords

CEO Characteristics; Profitability; Mining Companies; Islamic Business Ethics; leadership.

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DOI: 10.21043/equilibrium.v13i2.33882