corporate waqf

7/26/2019 Corporate Waqf

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Waqf in Islam (Endowments)

Waqf (referred as pious endowments) long held a crucial place in the political, economic, and

social life of the Islamic world. Waqf were major sources of education, health care, and

employment; they shaped the city and contributed to the upkeep of religious edifices. They

constituted a major resource, and their status was at stake in repeated struggles to impose

competing definitions of legitimacy and community. Closer examination of the diverse legal,

institutional, and practical aspects of waqf in different regions and communities is necessary

to a deeper understanding of their dynamism and resilience.

Generally they had to consist two main elements, first; a source of revenue, such as a

building, land, public bath, a warehouse etc.; and second; a beneficiary, such as a mosque, a

hospital, the poor, members of the founders family, freed slaves, or any other recipient of the

founders choosing. Usually the asset given as waqf are benefits the society, community and

the public. To be valid, a waqf had to consist of an object or objects originally held in full

property; the founder had to be of sound mind and body, and able to dedicate the property

in question to God. The waqf had to be permanent, which meant that the revenue it

generated had to be renewable, the property had to be subject to renewal or renovation, and

the founder had to stipulate means of ensuring the perpetuity of the waqf and the continual

disbursement of its revenues.

The components of waqf are Waqif (donor), Mauquf (assets/objects to be waqf), Mauquf

Alaih (beneficiary), Sighah (manifest intention to the contract) by Ijab and Qabul (offer &

acceptance), Waqf mutawalli (trustee) for Waqf Al Wasiyyah.


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History and early establishment

Waqf institutions (endowment foundations) have been long established and successful in

many Middle East countries such as Egypt, Syria, Palestine, Turkey, and Anatolia, and also in

South Africa.

In Malaysia, State Islamic Religious Council (SIRC) or (Majlis) is a sole trustee or a

mutawalli in any waqf arrangement. Majlis refers to the body constituted under the provisions

of the Islamic Administrative legislation of each state as passed by their respective Legislative

Assemblies and for the Federal Territories of Kuala Lumpur, Labuan and Putrajaya.

Majlis is an authority body in every state assigned by the Rulers of the states (called as

Sultan) respectively to govern a religious related matters. Since waqf is under religious matter

of the states, therefore, for the purpose of standardization and uniformity of the operation,

the role of trustee or Mutawallis is totally parked under the custodian of the Majlis.

Corporate Waqf

Corporate waqf is an innovative adaptation of the Islamic waqf institution that can be made a

key organisational strategy to translate the business jihad energy into real and sustainable

business and economic success. It is a creative and innovative act to use the waqf concept

and apply it to achieve business and corporate objectives.

The waqf need to be privatised by returning their assets to private management by creating

waqf boards of trustees. They will help managing the assets of waqf in a professional manner.

Apart from that, there is also a need a complete revitalisation of the management of waqf

especially, immovable assets of waqf, in order to fulfil two objectives: (i) to increase the


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efficiency and productivity of the waqf properties; and (ii) to minimise fraudulous practices

and corruption by the mutawalli/waqf managers. Furthermore, there is also a need to provide

a new style of management that suits the waqf institutions, keeping in mind that their

properties are not owned by those who manage them.

Difference between Conventional and Corporate Waqf:

Conventional Waqf Corporate Waqf

Waqif Mostly individualNot only individual, privatecorporation or GLCs can be part of

the waqif.

Mutawalli Mainly individual and the court Mutawalli can be a company

Activities

Usually limit itself within charitable

or pious activities or limited

businesses

With resources in its disposal may

spread its wing to venture to

sustainable business and corporate

activities.

With effective and efficient corporate-style of management, waqf may have better chance to

produce high and sustainable return to beneficiaries.

In short, corporate waqf is an effort to revive waqf role by inserting the efficiency of

corporate mechanism.


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Type of waqf

Essentially there are two types of waqf; Specific waqf and General waqf. Specific waqf also

known as waqf khas is where the donor declare beforehand what is the purpose of the waqf,

for example, build of a mosque or school or for any other purpose he specifies. The purpose

will then be specified in a waqf deed and the manager (mutawalli) who is entrusted to

administer the waqf as specified by the deed. General waqf on the other hand, is an open

ended waqf where the manager of the waqf may use the waqf properties for whatever

purpose as long as it benefits the public and the purpose is not against the Shariah

principles.

The Fatwa Decision

SELANGOR FATWA

Gains from the Saham Wakaf Selangor Scheme must be used for the purchase of permanent

assets. While money from waqf benefits may be used to provide aid and other expenses

deemed appropriately the Selangor Islamic Religious Council.

NATIONAL FATWA

Wakaf in the form of money is allowed in Islam.

Source:http://www.wakafselangor.gov.my/en2/index.php/2012-04-27-03-02-07/fatwa-decision

General Duties and Responsibilities of Mutawalli (Trustee)

Waqf manager and his/her responsibility is to administer that waqf property to the

best interest of the beneficiaries and then to maximize the revenues of the

beneficiaries.
http://www.wakafselangor.gov.my/en2/index.php/2012-04-27-03-02-07/fatwa-decisionhttp://www.wakafselangor.gov.my/en2/index.php/2012-04-27-03-02-07/fatwa-decisionhttp://www.wakafselangor.gov.my/en2/index.php/2012-04-27-03-02-07/fatwa-decisionhttp://www.wakafselangor.gov.my/en2/index.php/2012-04-27-03-02-07/fatwa-decision


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A mutawalli will monitor a waqf property in a proper way to ensure the continuity of

the existence of the assets and the beneficiaries will continue gain the manfaah of

the said property.

A mutawalli is not only a waqf keeper but he is also responsible to act in a corporate

style in order to increase the value of the assets and to enhance the cash inflow of

the institution and thus will maximise the revenues of the beneficiaries.

The State Islamic Religious Council was appointed by the states enactment governing the

Islamic affairs as the sole trustee of the waqf property for the purpose of improve the

efficiency and effectiveness of the management of waqf. SIRC are provided with the authority

to appoint any individual or a committee to act as its representative to execute the

administrative duties of the trusteeship of the waqf property.

As outlined by Siraj (2012), the main responsibilities, role and functions of SIRC as a trustee

on waqfs are:

To ensure that the waqf property manage and administer by them is being used,

spend or utilised in accordance to the purpose and terms and conditions set out by

the waqif. All the relevant documents in relation to the waqf property shall be in the

safe keeping of the SIRC. If the waqf property is involving land, SIRC shall be

responsible to transfer the rights of ownership from the waqif to SIRC and to

maintain the waqf land or building.


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To safeguard of the waqf property where the SIRC may develop and apply specific

laws, rules and procedures to govern the management and administration of waqf

property both on the administrative and financial aspects.

To develop the waqf property manages and administer by them. The SIRC is

responsible to find investors or to create a joint development with an investor, to

develop the waqf property in accordance to the terms and conditions sets by the

waqif when he created the waqf.

Reporting of the performance of the waqf management. Asserted that the lack of

transparency in the management of waqf contributed to the lack of public confidence

to endow their assets and funds as waqf. Each state enactment states the requirement

to produce relevant financial statements and accounts mainly for the purpose of

auditing and reporting (gazetting).

Development of Waqf in Malaysia

Institution / Project Information

Yayasan Waqaf Malaysia

(YWM)

https://www.ywm.gov.my/home

Officially formed by Jabatan Wakaf, Zakat & Haji (JAWHAR),

PM Department in 2008. Developing and promoting the

waqf property and assets throughout the country with

cooperation from State Islamic Religious Council (SIRC) as

the sole trustee of awqaf at state level.
https://www.ywm.gov.my/homehttps://www.ywm.gov.my/homehttps://www.ywm.gov.my/home


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Board of Trustees: Chaired by the Minister in the Prime

Minister Department and its membership consist of

representatives of each SIRC. Responsible for approving

groundwork and policies of YWM.

Formed a subsidiary, Perbadanan Wakaf Nasional Berhad in

2015 as implementers to the corporate waqf programmes

with support and collaboration with all SIRC.

Perbadanan Waqaf Selangor

(PWS)

http://www.wakafselangor.gov.my/en2/

Established in 2011 by Majlis Agama Islam Selangor (MAIS)

under the provision of the Administration of the Religion of

Islam (State of Selangor) enactment by the approval from

Sultan of Selangor. Source of authority from the Islamic

Religious and Waqf Enactments of Selangor, and

establishment Command of the PWS with objectives to

increase management of waqf property and inculcate the

waqf practice.

Introduced Cash-based waqf via PWS Corporate Associates

(Sahabat Korporat PWS) programme by inviting GLCs,

private and corporate sectors to appreciate and practise

waqf and contribute in developing waqf property; to present

the corporate and private sectors as icons for Muslims in

nurturing the practice of waqf; and to make the instrument
http://www.wakafselangor.gov.my/en2/http://www.wakafselangor.gov.my/en2/http://www.wakafselangor.gov.my/en2/


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of waqf a CSR for Muslims.

Perbadanan Waqaf Negeri

Sembilan Berhad (PWNS)

http://www.wakafnegerisembilan.com/

Established in 2005 and owned by MAINS Holdings Sdn.

Bhd., a corporation under MAIN Negeri Sembilan.

Source of power: State waqf Enactment & State

administration Enactments.

PWNS roles in carrying out waqf management within the

state in organised and professional manner. Become the first

state introduce Corporate waqf in Malaysia.

Waqaf An-Nur Corporation

Berhad (WANCorp)

Established by Johor Corporation Group of Companies to

manage the assets and shares of endowed for waqf.

Managed 1 Waqaf An-Nur Hospital & 21 Clinics. Other

projects, Waqaf Brigade and Waqaf Dana Niaga. These

projects basically with cooperation from SIRCs and

supported by the companies group.

Waqaf Selangor-Mualamat http://www.wakafselangor.muamalat.com.my

Collaboration project between Bank Muamalat Malaysia Bhd

and Perbadanan Waqaf Selangor. Cooperate through Joint

Management Committee from both organisation key

persons to manage waqf funds received from individual and

corporation as together. Funds specifically used for

healthcare and education and invested according to Shariah

principle.

Saham Waqaf Johor http://www.e-wakafjohor.gov.my/v2/
http://www.wakafnegerisembilan.com/http://www.wakafnegerisembilan.com/http://www.wakafselangor.muamalat.com.my/http://www.wakafselangor.muamalat.com.my/http://www.e-wakafjohor.gov.my/v2/http://www.e-wakafjohor.gov.my/v2/http://www.e-wakafjohor.gov.my/v2/http://www.wakafselangor.muamalat.com.my/http://www.wakafnegerisembilan.com/


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A scheme for Muslims community to buy waqf shares from

RM10 per unit through MAIN Johor. All donations received

will be used and concentrated for the Muslims needs.

MAIN Johor to manage and administer the waqf fund as the

Trustee and; as a trustee of the assets donated by Muslims

for certain purposes.

Al-Waqf Lil-Hayah http://wakaf.org.my/bi/index.php?lang=en

A religious endowment programme under Islamic Aid

Malaysia (IAM). IAM in its effort to raise funds to help

finance the construction of Islamic Aid Malaysias Residential

Complex for Orphans and the Poor which is located at

Kubang Pasu, Kedah. Appointing advisors i.e. Ustaz Ghazali

bin Ibrahim and Ustaz Tuan Asmawi Tuan Umar. Essentially

an endowment for life project aimed at encouraging

Muslims to practice virtuous religious attributes by donating

cash contribution.

As-Salihin Trustee Berhad http://www.as-salihin.com/en/products-services/family/wakaf

Provide waqf services such as advice on formation of waqf

and preparation of waqf agreements. Focusing waqf for

retail clients i.e. individual and families.
http://wakaf.org.my/bi/index.php?lang=enhttp://wakaf.org.my/bi/index.php?lang=enhttp://www.as-salihin.com/en/products-services/family/wakafhttp://www.as-salihin.com/en/products-services/family/wakafhttp://www.as-salihin.com/en/products-services/family/wakafhttp://wakaf.org.my/bi/index.php?lang=en


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Figure: Organisational Structure of Waqf Institution in Malaysia

Source: Muhammad (2010)

Securities Commission (SC) Guidelines

The SC has taken a number of initiatives to explore effective ways to revive the role of Waqf

in economic and social development through the ICM. Various key issues surrounding the

development of waqf assets and its potential were discussed among policy makers, senior

industry practitioners, Shariah scholars and academia. The book Waqf Assets: Development,

Governance and the Role of Islamic Capital Marketis made possible by the collective effort

of staff members of the SC. Parts of the book have been extracted from the deliberations

during the SC-OCIS Roundtable. The book focuses on leveraging Islamic capital market to

enhance the development of waqf assets. It serves as a guide for interested parties who wish

to explore opportunities of developing waqf assets through the Islamic capital market and

provides recommendations on governance best practices.


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About the Book: The growing focus on waqf is in line with overall efforts to identify new

growth drivers to broaden and strengthen the development of the Islamic finance industry.

With Islamic finance gaining traction across many parts of the world, the development of

waqf can play a significant role in attracting greater interest and participation in the Islamic

finance industry and indeed entrenching Islamic finance activities This publication is intended

to serve as a guide for waqf institutions, religious bodies, practitioners and other interested

parties who wish to explore opportunities in developing waqf assets through the Islamic

capital market and provide recommendations on governance best practices for waqf

institutions that intend to undertake Islamic capital market related activities specifically for

fundraising and investment.

The book is priced at RM80 per copy. For every purchase, RM20 will be donated to initiatives

supporting waqf development. To purchase please contact: SIDC Bookshop, Ground Floor, Securities

Commission Malaysia, 3 Persiaran Bukit Kiara, Bukit Kiara, Kuala Lumpur. Tel: +006 036204 8665; +006

036204 8644 Email: [email protected]

Further info: http://www.sc.com.my/waqf-assets-development-governance-and-the-role-of-islamic-

capital-market-book/
http://www.sc.com.my/waqf-assets-development-governance-and-the-role-of-islamic-capital-market-book/http://www.sc.com.my/waqf-assets-development-governance-and-the-role-of-islamic-capital-market-book/http://www.sc.com.my/waqf-assets-development-governance-and-the-role-of-islamic-capital-market-book/http://www.sc.com.my/waqf-assets-development-governance-and-the-role-of-islamic-capital-market-book/http://www.sc.com.my/waqf-assets-development-governance-and-the-role-of-islamic-capital-market-book/


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Conclusion

Corporate waqf is seen to be able to generate higher return on the undeveloped waqf

properties. Previously mentioned, Johor Corporation (Jcorp) through Waqaf An Nur

Corporation (WANcorp) is a proven success in its development of extensive programs for the

benefit of the ummah.

From the findings in Malaysian practise, there is no specific requirement or guidelines by the

relevant authorities on waqf in Malaysia. Although trustees must be appointed to administer a

waqf, the various Islamic Administration enactments throughout the country now mandate

that only State Islamic Statutory authorities or Majlis Agama Islam Negeri may act as such.

Bank Muamalat Malaysia Berhad is the first banking institution carrying out cooperation in

the management of waqf funds with States Islamic Council of Selangor through PWS.

Key Terms:

Awqaf Plural form of waqf

Mutawalli Trustee

Waqif Donor / founder

Mauquf-alaih Donee / recipient(s)

corporate waqf

Documents