Can disclosure practices and stakeholder management influence zakat payers’ trust? A Malaysian evidence

Abstract

This study examines whether disclosure practices and stakeholder management play an important role in influencing the zakat payers' trust in the zakat institutions in Malaysia. A regression analysis was performed to examine the relationship between disclosure practices and stakeholder management of the zakat institutions on zakat payers' trust. Using questionnaire survey on 184 zakat payers, this study shows that the disclosure practices do influence the zakat payers' trust in the zakat institutions. However, it is revealed that stakeholder management does not influence the zakat payers' trust in zakat institutions. The findings in this study imply that the zakat institutions should focus on the transparency of disclosure practices. The findings in this research could assist the zakat institutions to increase the trust level of the zakat taxpayers towards them and assist the policy makers in establishing zakat institutions which would be perceived by the public as legitimate.