A recent study led by Syaparuddin Razak from the State Islamic Institute of Bone in South Sulawesi, Indonesia, has shed light on the factors influencing zakah compliance among Indonesian Muslims. Published in the Journal of Islamic Monetary Economics and Finance, this research highlights the critical role of institutional capabilities in enhancing zakah contributions, which could have broader implications beyond religious obligations, potentially impacting sectors like energy.
The study surveyed 833 Indonesian Muslims who regularly donate zakat to official institutions, utilizing advanced analytical techniques to explore the relationships between zakah regulation, leadership, entrepreneurial competencies, and compliance. One of the key findings is that entrepreneurial skills significantly influence zakah compliance, suggesting that fostering these skills within zakah institutions could lead to increased contributions.
Razak emphasizes the importance of perceived taqwa, or piety, as a strong motivator for compliance, stating, “Entrepreneurial skills exert the most notable influence on zakah compliance.” This insight indicates that institutions focusing on enhancing their entrepreneurial capabilities could see a rise in zakah contributions, which could be redirected toward various sectors, including energy projects aimed at sustainability and community development.
Furthermore, the study notes that zakah regulation has a dual impact, affecting both compliance levels and the institutional capabilities of zakah organizations. This suggests that aligning regulatory frameworks with the growth of these institutions could lead to more efficient resource allocation, enhancing their operational effectiveness.
For the energy sector, this research presents a unique opportunity. By collaborating with zakah institutions to channel donations into renewable energy projects or community-based energy initiatives, organizations can leverage the increased compliance driven by improved institutional capabilities. This approach not only supports the growth of zakah institutions but also contributes to sustainable development goals, making a positive impact on local communities.
The findings advocate for a strategic focus on developing entrepreneurial competencies within zakah institutions, which could ultimately lead to a more robust and compliant zakah system. As Razak notes, “The introduction of institutional capabilities as a mediating factor signifies a departure from the traditional framework.” This innovative perspective could inspire new partnerships between zakah institutions and commercial sectors, particularly in energy, fostering a collaborative approach to social responsibility and economic development.
In summary, this research underscores the potential of zakah as a transformative financial tool, particularly when combined with strong institutional frameworks and entrepreneurial skills. The implications for the energy sector are significant, opening doors for investment in sustainable initiatives through enhanced zakah compliance among Indonesian Muslims.
