The Weak Empowerment Performance by Amil Zakat Institutions in Achieving SDG No. 1: Perspective of Intellectual Capital

Sigit Hermawan (), Kumara Aji Kusuma, M. Abror, Prasetyo Utomo and Amelia Nugraha Dini
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Sigit Hermawan: Universitas Muhammadiyah Sidoarjo
Kumara Aji Kusuma: Universitas Muhammadiyah Sidoarjo
M. Abror: Universitas Muhammadiyah Sidoarjo
Prasetyo Utomo: Universitas Muhammadiyah Sidoarjo
Amelia Nugraha Dini: Universitas Muhammadiyah Sidoarjo

A chapter in Proceedings of the 2nd International Conference on Management and Business (ICOMB 2023), 2024, pp 94-100 from Springer

Abstract: Abstract Amil zakat (zakat management) organizations in Indonesia are expected to help the government reduce poverty per the Sustainability Development Goals (SDGs) No 1. This research aims to formulate the role of amil zakat institutions in empowering mustahiq (zakat beneficiary) to reduce poverty, as seen from the intellectual capital (IC) perspective. A case study was conducted in micro-, small-, and medium-scale enterprises (MSMEs) mentored by the Indonesian National Board of Zakat (Baznas), Muhammadiyah-owned amil zakat organization (Lazismu), and LAZ Yatim Mandiri located in Gresik, Mojokerto and Pasuruan Regencies. This research used in-depth interviews and focus group discussion (FGD) with administrators of this amil zakat organizations, observation, and documentation to strengthen the data validity. The study found that most amil zakat organizations merely distributed the funds rather than empowering the mustahiq. While both are spreading the fund and assigning mustahiq were the two roles that the amil zakat organizations should play, simply distributing the zakat, infaq (voluntary alms), and sadaqah (voluntary charitable donation), from now on ZIS, would only lead the mustahiq to be a wasteful individual. Meanwhile, the ZIS fund could empower the mustahiq by providing them with working capital, equipment, tools, training, facilitation, and support. When empowerment was the dominant activity, Mustahiq’s economy would possibly be better and, thus, poverty would decrease, consistent with SDG No. 1. To empower the mustahiq, the IC perspective could be employed, i.e., by optimizing the integration between human capital, structural capital, and relational capital. From this research, it is recommended that amil zakat organizations mostly empower their mustahiq in an appropriate and well-planned manner because it will help turn mustahiq into muzakki (zakat payer) and reduce poverty. Finally, it is recommended for administrators of amil zakat organizations to employ IC perspective in empowering their mustahiq.

Keywords: Empowerment; Amil Zakat Organization; Poverty; Intellectual Capital (search for similar items in EconPapers)
Date: 2024
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DOI: 10.2991/978-94-6463-402-0_11

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