Analysis of the Effectiveness of the Sharia Supervisory Board in Maintaining Integrity and Sharia Compliance in Islamic Mutual Funds in the Indonesian Capital Market

Abstract

The Islamic capital market in Indonesia has experienced rapid growth in line with the increasing public awareness of the importance of sharia-compliant investments. One of the prominent instruments is the Islamic mutual fund, which requires supervision from the Sharia Supervisory Board (Dewan Pengawas Syariah/DPS) to ensure that all its activities comply with sharia provisions. This study aims to analyze the effectiveness of DPS supervision in maintaining the integrity and sharia compliance of Islamic mutual funds in the Indonesian capital market. The method used in this study is a library research approach, by reviewing various sources such as OJK regulations, DSN-MUI fatwas, capital market industry reports, and relevant previous studies. The findings indicate that the DPS plays a strategic role in maintaining investor confidence in the integrity of Islamic mutual fund products. However, the effectiveness of supervision still faces several challenges, including the limited number and competence of DPS members, suboptimal coordination mechanisms with OJK and DSN-MUI, and a lack of transparency in sharia compliance reporting. Therefore, strengthening DPS capacity through enhanced competency, sharia certification, and a more comprehensive supervisory evaluation system is necessary. Effective supervision is expected to reinforce the integrity and credibility of the Islamic capital market in Indonesia.