HINDU-BASED FINANCIAL MANAGEMENT AND BUSINESS SUSTAINABILITY: A MIXED-METHOD STUDY OF CREDIT VILLAGE INSTITUTIONS (LPDS) IN BALI

I Nyoman Bontot; Ahmad Subagyo; Martino Wibowo; Anas Iswanto Anwar

doi:10.25078/vidyottama.v9i2.5167

Authors

I Nyoman Bontot Universitas Terbuka
Ahmad Subagyo Universitas Muhammadyah Jakarta
Martino Wibowo Universitas Terbuka
Anas Iswanto Anwar Universitas Hasanuddin

DOI:

https://doi.org/10.25078/vidyottama.v9i2.5167

Keywords:

Hindu teachings, financial management, spiritual ethics, financial performance, business sustainability, village Credit Institutions.

Abstract

This study explores the integration of Hindu ethical principles into the financial governance of Village Credit Institutions (LPDs) in Bali and its contribution to institutional sustainability. Employing a mixed-method approach, the research combines hermeneutic interpretation of sacred Hindu scriptures-Rgveda, Yajurveda, Atharvaveda, Bhagawad Gita, Sarasamuccaya, Manusmrti, and Arthasastra-with quantitative analysis of financial performance across 1.308 LPDs in nine regencies. Four core principles-Karma (ethical productivity), Dharma (social responsibility), Kama (motivational fulfillment), and Artha (material prosperity)-are operationalized within a holistic model of Hindu-based financial management. Empirical testing confirms are positive relationship between these principles and financial indicators such as profit margin, return on assets, and capital growth. The findings demonstrate that Hindu-based financial governance enhances accountability, strengthens community trust, improves leadership integrity, and promotes long-term business sustainability. This study provides a culturally grounded and ethically robust framework for developing resilient and inclusive community-based microfinance institutions in plural financial systems.

References

Ahmed, H., Mohamad, S., & Bacha, O.I. (2019). Ethical Finance: The role of Shari’ah and Ethics in shaping Islamic finance. Journal of Economic Behavior & Organization, 162, 167-153. https://doi.org/10.1016/j.jebo.2019.03.01.

Alhadhrami, A.Y., & Nobanee, H. (2019). A comparison on sustainability practices between Islamic and conventional banks: Evidence from Gulf Cooperation Council countries. Sustainability, 11 (20), 6026. https://doi.org/10.3390/su11206026.

Astana, M. & Anomdiputro, G.S. (2005). Kautilya (Canakya): Artha Sastra (Masalah Politik, Ekonomi, Hukum, Budaya (Terjemahan). Paramita.

Atmaja, N. (2006). Lembaga Perkreditan Desa: Pilar ekonomi kerakyatan Bali. Denpasar: Pemerintah Provinsi Bali.

Creswell, J.W. (2007). Qualitative inquiry and research design: Choosing among five traditions (2nd ed.). Sage Publication.

Elkington, J. (1998). Cannibals with forks: The triple bottom line of 21st century business. New Society Publishers.

Escobar, A. (2018). Designs for the pluriverse: Radical interdependence, autonomy, and the making of worlds. Duke University Press.

Fatihudin, D., Jusni, & Mochklas, M. (2018). How measuring financial performance. International Journal of Civil Engineering and Technology (IJCIET), 9(6), 553-557.

Gadamer, H.G. (1975). Truth and method. Seabury Press.

Ginting, R. (2020). Rekonstruksi manajemen keuangan berbasis nilai-nilai spiritual. Jurnal Ilmiah Ekonomi Islam, 6(1), 10-17.

Gunawan, I.G.N. (2009). Peran LPD dalam Pembangunan desa adat di Bali. Denpasar: Universitas Udayana.

Haseeb, M., Hussain, H. I., Kot, S., Androniceanu, A., & Jermsittiparsert, K. (2019). Role of social and technological challenges in achieving a sustainable competitive advantage and sustainable business performance. Sustainability (Switzerland), 11(14). https://doi.org/10.3390/su11143811.

Hair, F.F., Hult, G.T.M, Ringle, C.M., & Sarstedt, M. (2021). A Primer on Partial Least Squares Structural Equations Modeling (PLS-SEM) (3rd Ed.). Sage Publications.

Huang, L., Tian, G., & Lin, W. (2023). Ethical leadership, environmental strategy, and firm performance: The moderating role of institutional pressures. Journal of Business Research, 160,113790. https://doi.org/10.1016/j.jbusres.2023113790.

Kaelan. (2005). Filsafat hermeneutic: Sebuah metode filsafat. Paradigma.

Mantra, I.B.N., Suwendra, I.W., & Sudarsana, I.K. (2023). Cultural capital and financial performance of Village Credit Institutions (LPDs) in Bali. International of Journal Science and Humanities, 7(2), 65-76, https://doi,org/10.31295/ijssh.v7n2.1440.

Marsuni, N., Subagyo, A., & Yunita, I. (2022). Islamic values in financial governance: An empirical study on microfinance in Indonesia. International Journal of Ethics and Systems, 38(3), 446-462. https://doi.org/10.1108/IJOES-05-2021-0101.

Mudana, I.G., Ardika, I.W., & Wirawan, I.M.A. (2021). Local wisdom-based micro finance: Exploring LPD’s cultural values in Bali. Jurnal Humaniora, 33(1), 76-89. https://doi.org/10.22146/jh.62959.

Nunnally, J.C. (1978). Psychometric Theory. New York: McGrow-Hill.

Pandit, B. (2009). The Hindu Mind: Fundamentals of Hindu Religion Philosophy for All Ages. New Age Books.

Sedgwick, P. (2012). The market economy and the ethics of business: A philosophical approach. Springer.

Sen, A. (2000). Development as freedom. Anchor Books.

Subagyo, A. (2018). Implementasi nilai-nilai Islam dalam manajemen keuangan syariah. Jurnal Akuntansi Multiparadigma, 9(1), 63-75. https://doi.org/10.18202/jamal.2018.04.9006.

Sudharta, I.K. (2009). Tri Hita Karana sebagai dasar pembangunan berkelanjutan di Bali. Denpasar: Yayasan Bali Kuna.

Suhardana, I.K. (2007). Manajemen berbasis kearifan local: Implementasi nilai-nilai Hindu dalam pengelolaan organisasi. Denpasar: Pustaka Bali Post.

Sutawan, N. (2010). The role of customary village and LPD in Bali. Denpasar: Pemerintah Provinsi Bali.

Tudose, M.B., Tudose, D.M., & Radu, F. (2022). Measuring the financial performance of rural microfinance institutions. Journal of Rural Development, 41(3), 205- 224.

UNDP. (2021). Human development report 2021/2022: Uncertain times, unsettle lives, United Nations Development Programme. https://hdr.undp.org

Wiagustini, N.L.P., Artini, L.G.S., & Suryandari, N.N.A. (2024). Cultural values and financial sustainability: A study of Village Credit Institutions in Bali. Journal of Sustainable Finance & Investment, 14(1), 1-17. https://doi.org/10.1080/20430795.2023.2243187.

Ziolo, M., Bak, I., & Cheba, K. (2020). Does sustainability and ethical finance create value for shareholders? A review of international evidence. Sustainability, 12(14), 5601. https://doi.org/10.3390/su12145601.

Zsolnai, L. (2015). The spiritual dimension of business ethics and sustainability management. Springer. https://doi.org/10.1007/978-3-319-12142-2.