Efficiency Of Zakat Institutions Research Articles

Editorial: Unveiling the intersection of governance and behavior: Insights from varied domains

This issue features a diverse selection of research articles covering a wide range of topics, including supply chain distribution, economic evaluation of costs, challenges faced by informal traders, the effects of macroprudential regulation, sustainability reporting, well-being in the funeral parlor industry, application of green accounting, self esteem, and job satisfaction among academic staff, science under occupation, oil exchange rates and organizational performance, the efficiency of zakat institutions, corporate social responsibility (CSR) adoption, talent management challenges, business risks, the impact of trust, and the impact of resilience.

Efficiency of zakat institutions: Evidence from an emerging economy

Efficiency is essential for an institution because it can measure how well resources are used to achieve its specific goals (Wahab & Rahman, 2011). Zakat institutions must be managed efficiently, so they are maximized in promoting socio-economic goals, especially poverty alleviation (Wahab & Rahman, 2013). This study aims to analyze the efficiency level of Baitul Mal districts/cities of Aceh Province in Indonesia. Efficiency measurement uses a nonparametric data envelopment analysis (DEA) approach during 2018–2020. DEA analyzes the interaction between input variables consisting of socialization costs, number of amil, and operational costs, with output variables comprising the total collection and distribution of zakat, infaq, and sadaqah (ZIS). The results show that 11 Baitul Mal out of 69 decision-making unit (DMU) (15.94%) are efficient overall, technical, and scale. As for technical efficiency, there are 16 Baitul Mal (23.19%) that are efficient, the remaining 26 Baitul Mal (40.58%) have a score below 60, and 27 Baitul Mal (36.23%) have a score above 60. Regency Baitul Mal Aceh Besar became the only Baitul Mal that achieved efficiency throughout the research period. The source of Baitul Mal’s inefficiency comes from all variables. Baitul Mal must optimize socialization costs by 60.68%, operational costs by 33.60%, and the role of amil by 3.20%. Furthermore, Baitul Mal must increase the amount of ZIS collection by 46.29% and the distribution of ZIS by 52.84% to achieve efficiency.

The Measuring Efficiency of Waqf Fund

This study will try to measure the efficiency of waqf funds in zakat institutions in Indonesia using the non-parametric Data Envelopment Analysis (DEA) method. The objects in this study are eight zakat institutions that manage waqf funds in Indonesia. The data in this study comes from the annual reports of each of these institutions during the period 2013-2020. The input variables in this study include operational costs and HR costs. In comparison, the output variables in this study include the collection and distribution of waqf funds. This study indicates that during 2013-2020, the efficiency of zakat institutions in managing waqf funds has a fluctuating trend. This study will also look at the possibility of improving inefficient programs from input and output variables; in general, the main factor in the efficiency of waqf funds lies in the output variable, namely the acceptance and distribution of waqf funds. In addition, this study provides a reference for other decision-making units (DMUs) in improving efficiency, and the average DMU used as a reference is the one who has good professionalism and innovation.
 Keyword : Waqf fund, Data envelopment analysis (DEA), Efficiency, Indonesia

The Performance and Efficiency of Zakat Institutions in Jambi

Zakat is the third pillar of Islam and has socio-economic impacts. In practice, zakat institutionshave limitations with regard totheir institutional and managerial aspects, which result in them not achiveing optimum performance and efficiency. This research aims to analyzethe performance and efficiency of zakat institutions in Jambi Province. This research measures the performance of zakat institutions through the institutional indicators of the National Zakat Index (NZI), and it measures theirefficiency using theData Envelopment Analysis (DEA) method. The samples used in this research are BAZNAS Jambi Province and LAZ RSIM. Based on the results of the performance analysis, BAZNAS Jambi hadan index value of 0.44, and LAZ RSIM hadan index value of 0.63,which classified the performance of the zakat institutionsas “fairly good”to“good.” Based on the results of the efficiency analysis, LAZ RSIM has reached the maximum level of 100% efficiency. BAZNAS Jambi Province is operating at56.1% efficiency. The average efficiency for the combined zakat institutions is 78.1%.
 
 Keywords: performance, efficiency, national zakat index (NZI), data envelopment analysis (DEA)

Productivity growth of zakat institutions in Malaysia

PurposeThe purpose of this paper is to analyze the changes in productivity of zakat institutions in Malaysia from 2003 to 2007. The data consist of a panel of 14 State Islamic Religious Councils (SIRCs) in Malaysia. Efficiency is measured by the Malmquist Index, using a data envelopment analysis (DEA) technique.Design/methodology/approachThis paper uses Malmquist Productivity Index, using a DEA technique. The Malmquist productivity measures are decomposed into two components: efficiency change and technical change index.FindingsThe results showed that total factor productivity (TFP) has increased slightly for the whole industry, which is mainly due to the technical change rather than the efficiency change. Further decomposition of the efficiency change into its pure technical and scale efficiency components suggest that the pure efficiency is found to be a more important source of efficiency change than scale efficiency component.Originality/valueThis paper investigates the productivity and efficiency of zakat institutions in Malaysia. It will be of value to provide evidence to the policy makers to improve the efficiency of the institutions.