FOSTERING DIGITAL ETHICS: THE ROLE OF CHARACTER BUILDING IN THE ERA OF AI AND ISLAMIC FINANCE

Mohammad Fathullah Bin Mohammad Rodzi; Fadhilah Abdullah Asuhaimi

doi:10.33102/ada0x202

Authors

Mohammad Fathullah Bin Mohammad Rodzi Department of Finance, Kulliyyah of Economics & Management Sciences (KENMS), International Islamic University Malaysia, Gombak, Selangor, Malaysia Author
Fadhilah Abdullah Asuhaimi Department of Finance, Kulliyyah of Economics & Management Sciences (KENMS), International Islamic University Malaysia, Gombak, Selangor, Malaysia Author

DOI:

https://doi.org/10.33102/ada0x202

Keywords:

Artificial Intelligence, Character Building, Digital Ethics, Islamic Finance, Maqasid al-Shariah

Abstract

Background: The rapid integration of Artificial Intelligence (AI) and digital technologies is fundamentally reshaping the landscape of Islamic accounting, banking, and finance. While AI offers unprecedented opportunities for operational efficiency and sustainable growth, it simultaneously introduces complex ethical, transparency, and governance challenges. Problem Statement: However, there is a critical gap in addressing the human element: the foundational role of character building and internal moral governance among the professionals utilizing these technologies. Objective: This study aims to explore the intersection of AI integration, character building, and governance within the Islamic financial sector, proposing that true sustainability requires a synthesis of advanced technology and deeply rooted ethical values. Methodology: A comprehensive literature review was conducted, synthesizing contemporary research across AI in finance, corporate governance, digital ethics, and Islamic moral frameworks (such as Maqasid al-Shariah). Findings: The review reveals that sustainable AI governance in Islamic finance cannot rely solely on external compliance or algorithmic auditing. It requires robust internal character building rooted in core Islamic principles like Amanah (trustworthiness), Adalah (justice), and Ihsan (excellence). The literature suggests that cultivating digital ethics and moral resilience is the most effective safeguard against AI-driven risks, such as algorithmic bias, data privacy breaches, and unethical financial modeling. Conclusion: To achieve a truly "future-ready" Islamic financial ecosystem, institutions and educational bodies must prioritize human-centric governance. We propose a conceptual framework where character building is integrated as a mandatory foundation in financial training, ensuring that AI adoption aligns with both technological advancement and sustainable, ethical Islamic governance.

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