The corporate reputation of Islamic banks: a measurement scale.

Abstract

During the last few years, the concept of corporate reputation has received considerable attention from marketing academics and practitioners alike. This is not surprising in view of the concept enormous practical implications. Suffice it to say, that the market value of a modern company lies mainly in its intangibles assets. Corporate reputation embodies all of the intangible capital that a company may have. The current study describes an attempt to develop and validate a scale to measure the corporate reputation of Islamic banks. The operational definition of the construct draws mainly on its attitudinal and perceptual nature. To tap into the different dimensions of the target domain, an initial item pool of 42 statements was developed following a comprehensive review of related literature. Successive stages of revision, editing, rewriting and face and content validity reduced the initial item pool to 29 statements. These were put to a convenient sample of 150 bank customers in the Kingdom of Bahrain. The resultant data set was factor analyzed. A Principal Component Analysis extraction method suggested a two factor solution. Between them,the two factors explained 55% of the total variance in the factor model. Items that loaded poorly on any of the two components were eliminated from the analysis. 17 items made up the final version of the scale. The Cronbach alpha coefficients revealed that the two subscales and the overall scale were reliable. The inter-item correlation coefficients, the variance extracted, the factor communalities, and the Cronbach alpha coefficients do all point to the validity of the construct: that all the items in the scale seem to measure an underlying theme, in this case the corporate reputation of Islamic banks.