Developing Islamic Ethical Institutionalization Capability in Halal Logistics: An Integrative Framework for Sustainable Halal Supply Chains

HRMARS - The rapid expansion of the global halal economy has intensified the need for logistics systems that uphold both operational efficiency and ethical integrity. Despite growing academic attention, most halal logistics research remains compliance-oriented, emphasizing certification and segregation rather than the institutionalization of Islamic ethical values. This paper develops and advances the construct of Islamic Ethical Institutionalization Capability (IEIC)—a dynamic capability that transforms Islamic moral intent into enduring systems of governance and technological reinforcement. Drawing on Institutional Theory (Scott, 2008) and Maqasid al-Shariah (Dusuki & Abdullah, 2007), the model integrates three interactive mechanisms: ethical internalization, ethical governance, and technological reinforcement. Together, these mechanisms enable organizations to convert ethical conviction into structured, traceable, and adaptive institutional processes. The framework explains how IEIC produces both institutional legitimacy—through social and regulatory acceptance—and spiritual legitimacy—through divine accountability. By framing ethics as an organizational capability that can be developed and renewed (Teece, 2007), IEIC applies dynamic capabilities theory to ethical management, contributing to the Islamic management literature through a process-oriented approach to understanding ethical resilience. The paper also identifies specific conditions necessary for IEIC to succeed, including organizational maturity, cultural integration, and technological infrastructure. Additionally, it presents testable propositions that connect ethical values, governance structures, and technological transparency to sustainable halal supply chain performance. The study concludes that maintaining halal integrity over time requires internal organizational commitment to Islamic ethics rather than reliance on external oversight. As such, IEIC offers both a theoretical framework and practical guidance for developing halal logistics into a self-sustaining ethical system that integrates religious principles, governance mechanisms, and technology to achieve lasting ethical legitimacy.