This paper develops a conceptual framework for integrating zakat and waqf as complementary instruments aimed at sustainable economic empowerment. The two main pillars of Islamic social finance, zakat and waqf, have historically and theologically pursued complementing social goals of the public interest (maslahah), social protection, and poverty alleviation. In many Muslim-majority nations, waqf (an endowment intended to produce enduring public benefit) and zakat (a redistributive, mandatory alms giving) have mainly functioned in separate institutional and legal frameworks while having a similar goal of improving human welfare and acts of worship. This paper aims to discuss the strategic integration of zakat and waqf, particularly in contemporary forms like cash waqf, zakat-funded waqf seed capital, and joint zakat-waqf impact programs, to significantly increase the resource base for programs aimed at sustainable economic empowerment, boost the effectiveness of attaining the Sustainable Development Goals (SDGs), and enhance governance and accountability in Islamic social finance. The paper presents an operational framework for integration, addresses governance safeguards and shariah considerations, and provides policy recommendations to practitioners, regulators, and donors using a systematic literature synthesis, comparative models, and illustrative case studies (Indonesia, Malaysia, Nigeria) and contemporary conceptual models. The study concludes that, despite operational, legal, and institutional obstacles, digitally enabled governance, standardized impact indicators, and hybrid public-private partnerships offer practical means to scale zakat-waqf integration for inclusive and sustainable development.
Tag: sustainability
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Waqf Business Model (WBM): Towards A Sustainable Social Business Model on The Mainstream Economics
The Waqf Business Model (WBM) represents an innovative and transformative approach to establishing a sustainable social business model within mainstream economics, rooted in Islamic economic principles. This paper explores the current state of waqf as an alternative model for social business, emphasizing its ability to combine social impact with long-term economic sustainability by preserving assets and generating ongoing revenue. It also advocates for integrating WBM into the mainstream economy to serve as a powerful mechanism for addressing the Sustainable Development Goals (SDGs). The paper highlights the challenges faced by traditional Islamic economic institutions, particularly waqf, which have struggled due to outdated management practices and a conceptual crisis regarding the role of waqf in modern economies. Revitalizing waqf institutions requires enhancing their capabilities and aligning them with contemporary business strategies. Additionally, this paper encourages future research to explore how WBM can be fully integrated into the existing economic ecosystem. In theory, WBM provides a framework for ethical and inclusive economies, while in practice, it has the potential to create self-sustaining institutions that reduce reliance on external aid, offering an innovative solution to global socio-economic challenges by blending sustainable innovation.
