Exploiting Public Attitudes Toward Waqf: Advancing Socio-Economic Sustainability In Malaysia’s Green Economy Strategy

Exploiting Public Attitudes Toward Waqf: Advancing Socio-Economic Sustainability in Malaysia’s Green Economy Strategy

Hashim, R, Aminuddin ZM*, Bhari, A

Faculty of Business & Management, Universiti Teknologi MARA Cawangan Selangor, Puncak Alam 43200, Selangor, Malaysia

*Corresponding author

DOI: https://dx.doi.org/10.47772/IJRISS.2025.909000388

Received: 22 August 2025; Accepted: 30 August 2025; Published: 13 October 2025

ABSTRACT

Malaysia’s sustainable development strategies are aligned with Islamic finance and waqf principles, which are also being touted as an instrument for achieving Malaysia’s Green Economic Strategy (GES), emphasizing low-carbon growth, renewable energy utilization, and equitable wealth distribution. Yet the capacity of waqf to fulfill these intended purposes depends on the need to overcome demographic limitations within the Malay majority in Malaysia, such as income disparities, the pace of urbanization, and the degree of religious observance—factors that in varying measures condition both the willingness and capacity to contribute towards or manage waqf assets. This article examines the phenomenon of interaction between socio-cultural dynamics, institutional frameworks, and the influence of waqf on socio-economic undertakings, as well as its capacity to contribute to socio-economic sustainability in Malaysia’s transition to a greener economy. Using a review of literature method, the study scientifically evaluates the waqf’s appropriateness with the principles of the green economy (green economic growth, social equity, and environmental preservation).  Waqf resources can be organized to help mitigate existing funding gaps in renewable energy projects, including solar farms, lakes, green urban housing, and community agriculture initiatives. Waqf represents a critical tool for policymakers and religious institutions to build a green economy. It can overcome existing barriers to make sustainability and Islamic finance more than aspirational goal by transforming them into mainstream practice through faith-based environmental action

Keywords: waqf, attitudes, socio-economic sustainability, green economy, Malay

INTRODUCTION

For centuries, Waqf has played a crucial role in the development of Muslim societies as a mechanism for endowment under Islamic law. Waqf serves as a means of continually benefiting society by investing capital in religious, charitable, and community endeavors. In Malaysia, waqf was historically utilized for education, healthcare, and the construction of basic facilities. Nonetheless, its role in the context of sustainable development in the 21st Century, particularly to the economic development of the poor within a green economy, has not been widely elucidated (Sukmana et al., 2023). However, waqf offers a great potential of contributing to the social and economic development of Malaysia and environmental sustainability, which is congruent with the green economy policy of the country.

The public’s perceptions of waqf was as a resource for generating sustainable income to benefit the community in the long run, thereby alleviating poverty, providing education, healthcare, and eco-friendly activities, are significant (Razak, 2020). In recent years, Malaysia has also witnessed the emergence of new forms of waqf, including cash waqf, which leverages Shariah-compliant financial instruments to enhance the modern management of waqf and ensure its broader significance. However, obstacles stubbornly remain, such as trust and governance challenges, which dampen public confidence (Rosele et al., 2024). A recent controversy exposing this difficulty concerned irregularities in the zakat fund management, when an Auditor-General’s Report found that some RM14.73 million scheduled for “asnaf fisabilillah” (category of people involved in Islamic propagation) had devolved to general welfare organization scopes with vague guidelines and ambiguities on religious ruling (Mohamad & Sori, 2023). This concern underscores the importance of transparency and regulatory certainty for Islamic social spending institutions to foster public confidence and thereby enhance the potential of waqf to contribute to Malaysia’s socio-economic and environmental objectives.

The green economy has been growing in importance in Malaysia in the last few years as a key component of its national development agenda. This approach seeks to reconcile economic growth, environmental protection, and social well-being in the face of challenges like climate change, resource scarcity, and social exclusion (Othman et al., 2025). Realizing the significance of waqf in community well-being, there is also a growing realization about the potential for harnessing waqf assets and management in greening the economy to enhance socio-economic well-being. Such integration would enhance the effect of waqf and bring it in consonance with contemporary developmental goals. Despite this, waqf could potentially face some obstacles in fully supporting Malaysia’s green economy. These include low public awareness about the environmental functions of waqf, regulatory and institutional obstacles, and a shortage of innovative models that connect waqf assets with environmental projects. Furthermore, waqf is also generally seen as a predominantly religious or charity instrument that may limit its role in a wider economic and environmental context. There will be no easy remedies: Tackling these challenges will need a multipronged strategy that includes policy reformation, community involvement, and capacity building.

Consequently, this study attempts to explore the public perceptions on waqf in the context of the green economy strategy in Malaysia. Knowledge of these attitudes is pivotal to identifying stumbling blocks and prospects of how waqf can be utilized in promoting socio-economic sustainability. By exploring the views and perspectives of various stakeholders, including policymakers, practitioners, and the public, the study aims to contribute to the knowledge base on promoting the better integration of waqf into sustainable development. In the long run, this could support a more sustainable and inclusive green economy in Malaysia.

The Green Economic Strategy of Malaysia seeks to distribute the economic benefits while preserving the environment and ensuring social equity. The approach focuses on clean energy, sustainable agriculture, and green infrastructure (Fauzi et al., 2022). But money is the “biggest barrier!” Waqf, as a sustainable and social-financial instrument, is a best-fit tool to fill this gap. Meanwhile, demographic factors within the Malay community, including income disparity, urban living, and variations in religiosity, may impact how waqf can be effectively utilized in achieving these goals. This study examines the perception of waqf in Malaysia and its potential to contribute to the country’s Green Economic Strategy by promoting socio-economic development and addressing the demographic limitations faced by Malaysian sociologists.

Problem Statement

Waqf in Malaysia faces issues of underutilization of waqf properties and a lack of public awareness that hinders its ability to support current social and environmental goals (Ishak et al., 2025). Additionally, demographic challenges within Malay society, such as income inequality, levels of urbanization, and religious practice, can influence the role of waqf in achieving these objectives (Nur, 2019). There is a need to explore innovative ways to integrate waqf with green economy principles, ensuring that Islamic endowments are effectively utilized to address the environmental and socio-economic challenges faced by the Malaysian population as well as to achieve the Green Economic Strategy. Henceforth, the study’s three objectives were to explore Malaysian Malays’ perceptions on waqf and its socio-economic sustainability; to examine how far waqf and Malaysia’s Green Economic Strategy have been integrated and lastly, to suggest measures to elevate the position of waqf in the sustainable development plan of Malaysia, taking into account the demography of the Malays.

LITERATURE REVIEW

This article will review three principal elements: the definition of waqf and its historical perspective, waqf in Malaysia, Malaysia’s Green Economic Strategy, and its correlation with socioeconomic sustainability, as well as the potential of waqf in promoting the green economy. The review will also highlight the research gaps identified in the existing literature and emphasize the need for further investigation into the integration of waqf with Malaysia’s Green Economic Strategy.

Malaysia’s Income Inequality and Role of Waqf

Despite ongoing efforts to promote inclusive growth, income inequality remains a significant socio-economic problem in Malaysia. There is a correlation between social cohesion and economic stability between the rich and the poor. One such means to do so is through waqf, an Islamic philanthropy tool that has begun to gain more attention in the effort to bridge these disparities by redistributing wealth through charitable trusts. Research has shown that waqf can therefore be exploited to enhance economic parity through socioeconomic upliftment, particularly for poor communities, leading to a reduction in income disparities (Norzilan, 2018; Othman et al., 2023). Furthermore, the inclusion of waqf in the national development framework aligns with Malaysia’s broader development goals, particularly in achieving an equitable distribution of wealth and promoting social justice (Rana et al., 2020; Razak, 2020). Nonetheless, there are challenges to waqf, such as the underutilization of waqf properties due to legal and management issues that still hinder its realization of full potential in addressing income inequality (Abdullah et al., 2024).

Waqf plays an important role in reducing income inequality and promoting poverty eradication in Malaysia. As waqf is a part of Islamic social finance, it enables Malaysia to strengthen the spirit of poverty reduction and economic equality, which aligns with the national development agenda (Norzilan, 2018; Othman et al., 2023). The gap between the rich and the poor, as well as the poverty eradication program in Malaysia, is substantially linked to the establishment of waqf, particularly in the elimination of socio-economic problems. Waqf, an Islamic endowment, has been identified as an instrument that has great potential in mitigating income inequality and fostering social justice through the redistribution of wealth. Malaysia faces challenges related to income inequality and is taking steps to enhance economic growth and reduce the disparity between the rich and the poor. Wealth redistribution “to the poor” — using waqf as a tool “to ensure redistribution” — requires the poor in one way or the other to be identified (Rana et al., 2020). However, waqf has long been in existence in Malaysia and has played an active role in the development of education, health, and social welfare in society. Abdullah et al. (2024) indicate that several waqf assets are underutilized due to legal and administrative issues. Contemporary forms of waqf, for example, cash or corporate waqf, provide alternative ways of financing projects of sustainable development (Sanusi et al., 2024; Yunus et al., 2024).

Poverty Alleviation through Waqf Initiatives

Poverty alleviation remains a top priority for Malaysia, with government programs and social welfare schemes aimed at uplifting low-income groups. In this context, waqf has emerged as a promising complementary tool to traditional poverty reduction strategies. Research on cash waqf, a modern form of waqf involving monetary endowments, demonstrates its significant potential in reducing poverty rates and enhancing social welfare (Shahimi & Zahari, 2025). System dynamics modeling studies indicate that cash waqf could reduce poverty by up to 50%, while also easing the financial burden on government assistance programs. Additionally, established waqf institutions in Malaysia, such as Perbadanan Wakaf Selangor, provide evidence of waqf’s positive impact on socio-economic development by funding education, healthcare, and community services (Sanusi et al., 2024). These findings suggest that expanding and modernizing waqf practices could play a crucial role in sustainable poverty alleviation.

Waqf’s Contribution to Socio-Economic Development in Malaysia

Waqf has a long-standing history in Malaysia, contributing significantly to various sectors including education, healthcare, and infrastructure development. Beyond its traditional roles, recent studies emphasize waqf’s evolving function as a strategic instrument for socio-economic empowerment and sustainable development (Zauro et al., 2020). The development of cash and corporate waqf models introduces innovative financing mechanisms that can support sustainable projects aligned with Malaysia’s green economy and social welfare goals (Nur, 2019). Empirical evidence also suggests that the growth of cash waqf has positive long-term effects on Malaysia’s economic growth, including job creation, human capital development, and increased national income (Khamis et al., 2024). Despite these promising outcomes, maximizing the socio-economic impact of waqf requires overcoming institutional barriers, enhancing public awareness, and leveraging technology for improved asset management (Hasan & Syahruddin, 2022; Hidayat et al., 2024). Overall, waqf represents a vital component in Malaysia’s pursuit of inclusive and sustainable development.

Evolution of Malay Attitudes Toward Waqf and the Socioeconomic Impact of Cash Waqf

The attitudes of Malays in Malaysia toward contributing to waqf have undergone significant evolution from the past to the present, reflecting both cultural traditions and modern socioeconomic contexts. Historically, waqf played a central role in supporting religious, educational, and social infrastructure within Malay Muslim communities. Contributions were often made in the form of land or property dedicated to building mosques, madrasahs, and community facilities, deeply embedded in Malay Islamic culture and customary law (adat) that shaped waqf practices locally. This traditional waqf system primarily focused on tangible assets and religious purposes, with strong community support and a sense of spiritual obligation motivating contributions (Saad et al., 2023).

Sapir et al. (2023) stated that the public attitudes toward waqf remain generally positive, but there is a shift toward more diversified forms of contribution, especially with the rise of cash waqf. Cash waqf, which allows Muslims to donate money that is pooled and invested to generate sustainable income, is gaining traction due to its flexibility and potential for broader socioeconomic impact. Institutions like Perbadanan Wakaf Selangor have successfully raised millions in cash waqf contributions, demonstrating growing public trust and awareness, particularly among younger and urban Malay Muslims. This modern form of waqf aligns well with Malaysia’s national development goals and the green economy strategy, as it can be channeled into income-generating projects that sustainably benefit the community.

Cash waqf offers a promising mechanism to accurately identify and uplift the needy in the short term while reducing their long-term dependency on zakat and other donations. Unlike traditional waqf, which often focuses on infrastructure, cash waqf funds can be strategically invested in productive economic activities, such as microenterprises, agriculture, or renewable energy projects (Jaffar et al., 2023), thereby creating employment and generating continuous income streams for beneficiaries. By distributing waqf proceeds on a scheduled basis (e.g., every three months), institutions ensure timely support targeted at those in need, while reinvesting a significant portion (e.g., 70%) to grow the waqf capital and expand its impact. This cyclical reinvestment model helps build sustainable wealth within the community, empowering zakat recipients to become economically self-reliant and less dependent on charity over time (Ishak et al., 2025).

Additionally, the transparent management and professional administration of cash waqf by organizations such as the state Islamic Religious Councils bolster public confidence, encouraging broader participation and more effective resource allocation. This institutional credibility is vital for ensuring that waqf funds reach those in genuine need and are utilized in ways that promote long-term socioeconomic upliftment. Therefore, cash waqf not only maintains the spiritual and charitable essence of waqf but also modernizes its application to tackle contemporary issues of poverty, income inequality, and sustainable development in Malaysia (JAM, 2022).

Green Economy Strategy and Development in Malaysia

Malaysia’s Green Economic Strategy, outlined in the National Green Technology Policy and Master Plan, emphasizes the development of renewable energy, sustainable agriculture, and green infrastructure. The strategy aims to reduce carbon emissions, enhance resource efficiency, and promote social equity (Fauzi et al., 2022). However, funding remains a major constraint, creating an opportunity for innovative financing mechanisms like waqf.

Malaysia’s commitment to a green economy is formalized through strategic frameworks, such as the Green Technology Master Plan (2021–2030) and the Sustainable and Circular Economy Roadmap (2023–2040), which target the expansion of renewable energy, waste reduction, and resource efficiency (Siregar, 2024). These policies aim to decarbonize key sectors—particularly manufacturing, which contributes 10% of national emissions—through initiatives such as the New Industrial Master Plan 2030’s “Push for Net Zero” mission. By 2023, renewable energy was expected to account for 22% of Malaysia’s grid, driven by investments in solar and hydroelectric power, alongside waste-to-energy projects that advanced circular economy principles. However, challenges persist, including fossil fuel dependency in hard-to-abate industries (e.g., steel and cement) and regulatory gaps in scaling green investments.

Economically, green initiatives have attracted RM8.2 billion in investments across 588 projects (e.g., bioenergy and electric vehicles) as of 2024, signaling strong private-sector engagement. The establishment of Energy Exchange Malaysia (Enegem) further facilitates cross-border renewable energy trade, supporting regional sustainability goals. Despite progress, socio-economic disparities persist, with rural communities often left out of green job opportunities, underscoring the need for inclusive policies that align environmental and poverty-alleviation objectives (Sudi et al., 2024).

Alignment of Waqf and Green Economy

Waqf and the green economy emphasize sustainability, social welfare, and long-term benefits (Hasan & Syahruddin, 2022). Waqf assets, such as land and funds, can be used for renewable energy projects, sustainable agriculture, and green infrastructure. Studies by Abdullah et al. (2024) suggested that waqf can be transformative in addressing environmental challenges while promoting socioeconomic development. The alignment of waqf with Malaysia’s green economy is increasingly recognized as a strategic convergence of Islamic philanthropic principles and sustainable development goals. Waqf, traditionally a religious endowment for social welfare, is now being reimagined as a dynamic financial instrument that can support environmental stewardship and climate resilience. This alignment is underpinned by Islamic teachings that emphasize the sacredness of nature and the concept of Al-Mizan (balance), which calls for harmony between human activities and the environment. Through this lens, waqf assets can be mobilized not only to address socio-economic needs but also to fund projects that promote ecological balance and reduce carbon emissions, thus advancing Malaysia’s low-carbon aspirations. Green waqf initiatives in Malaysia have begun to demonstrate practical applications in renewable energy, afforestation, and sustainable urban development (Sapuan & Zeni, 2021). For example, waqf funds are being used to install solar panels on mosques and community centers, reducing reliance on fossil fuels and lowering electricity costs. Additionally, cash waqf schemes are proposed to finance research and development in renewable energy technologies, which are critical for the country’s transition to a green economy. Beyond energy, green waqf models also extend to sustainable waste management and conservation projects that create employment opportunities while addressing environmental degradation (Othman et al., 2025). These initiatives illustrate how waqf can serve as a catalyst for inclusive green growth by empowering communities and fostering long-term socio-environmental benefits.

Institutionally, the alignment of waqf and the green economy requires robust legal, financial, and governance frameworks to maximize impact (Mukhlishin et al., 2024). Studies suggest that integrating green waqf into national sustainability strategies involves developing innovative Islamic finance instruments such as green sukuk and digital platforms to enhance transparency and attract wider participation. Moreover, policy recommendations emphasize the need for collaboration among government agencies, waqf institutions, and private sectors to streamline asset management and ensure that waqf funds are effectively channeled into eligible green projects. This systemic approach not only strengthens waqf’s role in environmental conservation but also supports Malaysia’s broader Sustainable Development Goals by harmonizing economic growth with ecological preservation.

Waqf’s Role in Advancing Sustainability

Waqf has evolved beyond traditional socio-religious functions to become a catalyst for environmental and economic resilience. Studies demonstrate its efficacy in funding solar energy projects exemplified by solar waqf installations in 20+ Malaysian mosques, reducing electricity costs by ~RM500 monthly per site (Bahrin et al., 2025). These initiatives align with Malaysia’s green transition by decentralizing renewable energy access and promoting community-level climate adaptation.

In agriculture, integrated cash waqf models (e.g., in Kedah’s rice farming) incentivize sustainable practices, improving yields while reducing ecological footprints. Waqf forests and coastal conservation projects further mitigate climate risks—such as flooding—through natural barriers like mangrove restoration. Financially, corporate waqf structures unlock capital for green ventures, with evidence suggesting that waqf growth is linked to job creation and long-term economic stability (Khamis et al., 2024).

Governance remains critical: Legal frameworks must address asset underutilization and enhance transparency to maximize waqf’s impact (Triyanta et al., 2024). Innovations like Shariah-compliant green financing models could bridge institutional gaps, positioning waqf as a pillar of Malaysia’s sustainable development strategy (Mukhlishin et al., 2024).

Malaysia’s green economy and waqf intersect at policy, environmental, and socio-economic levels. While national strategies prioritize industrial decarbonization, waqf offers grassroots mobilization for sustainability—transforming religious endowments into tools for renewable energy, poverty reduction, and climate resilience. Future success hinges on integrated governance that unites these domains.

METHODOLOGY

Research Design

The approach taken herein is a systematic literature review or SLR-inspired qualitative research design, which is well-suited for studying intricate social science-based phenomena, such as waqf and its inclusion within frameworks of sustainability. The qualitative perspective offers a more comprehensive understanding of knowledge, institutional practices, and public opinion – a rich contextual understanding that is not possible with only quantitative results. The SLR enables a systematic and impartial capture of related academic and policy literature, methods that facilitate knowledge production in date waqf studies (Razak, 2020).

Data Sources and Search Strategy

A comprehensive search of the literature was conducted across several reputable databases, including Scopus, Web of Science, Google Scholar, and institutional repositories. The search consisted of a combination of keywords (“waqf”), (“attitude”), “socioeconomic sustainability”, “green economy”, “Malaysia”, Islamic finance, and terms and operators (AND, OR, NEAR). The search used relevant controlled vocabulary and text words. Primary sources (original journal articles, conference papers) and secondary sources (government reports, policy documents, institutional publications) were used to provide a full picture. The search was restricted to publications within the last decade to provide a contemporary perspective (2014–2024).

Inclusion and Exclusion Criteria

To focus and ensure the quality of the studies, the inclusion criteria were based on:

• Its relevance to waqf and its socio-economic or environmental functions in Malaysia or similar situations.
• Theoretical or empirical studies on waqf governance, public perspectives, or incorporation within the green economy.
• Availability in English or Malay.

The exclusion criteria were removed:

• Research projects that do not relate to waqf and sustainability.
• Non-academic sources lack verifiable data.
• Duplicate documents or obsolete items published before 2013. This filtering mechanism increased the validity of the selected data by keeping the dataset as relevant and reliable as possible.

Data Extraction and Management

Relevant data were systematically extracted from each study, including purpose, method, and findings related to public attitudes, institutional challenges, and the waqf’s role in sustainability. QDA software was used to manage data for coding and thematic synthesis. This analysis process reveals recurring themes, contradictions, and gaps in the research, which facilitate a structured interpretation of the literature (Kamarubahrin et al., 2019).

Analytical Framework and Thematic Coding

Thematic analysis, which provided a clear coding structure and was used to interpret the qualitative data, contributes to the reliability of the study. Themes were derived inductively from the literature, which encompassed public perception, policy and regulation, management practices, socioeconomic effects, environmental initiatives, as well as the challenges of integration. The coding process was iterative, with cross-checking performed to identify consistency and minimize researcher bias Cole (2024). It is also in accordance with best practice guidelines for qualitative research and waqf accountability studies.

Design limitations and ethical issues

The authors acknowledge the limitations of qualitative reviews, including their reliance on the available literature and the potential for publication bias. Ethical issues were limited in nature, as the investigation utilized data available in the public domain; however, all viewpoints were represented fairly.

This systematic and layered methodology framework will facilitate the study’s results on the contribution of waqf to socioeconomic sustainability and the green economy in Malaysia, making them strong, reliable, and actionable. It also offers a model that can be applied to other studies within the Islamic finance and sustainable development domains.

To reiterate, this study employs a qualitative research design grounded in a systematic literature review (SLR) approach, which is well-suited for exploring complex social phenomena, such as waqf and its integration into sustainability frameworks. The qualitative approach allows for an in-depth understanding of existing knowledge, institutional practices, and public attitudes, providing rich contextual insights beyond mere quantitative measures. The SLR ensures a comprehensive and unbiased synthesis of relevant academic and policy literature, aligning with the methods used in recent waqf studies.

Data Sources and Literature Search Strategy

Data sources or secondary data from literature searches were rigorously ferreted and screened to ensure validity. These data were sourced from three reputable databases subscribed to by the university library, such as Scopus and the Web of Science. On the other hand, Google Scholar was also included, and non-indexed articles were also highly cited. The search activities used relevant research problem keywords as well as Boolean operators, for example, “waqf,”, “attitude”, “socioeconomic sustainability,” “green economy,” “Malaysia,” and “Islamic finance.” Both primary sources (peer-reviewed journal articles, conference papers) and secondary sources (government reports, policy documents, institutional publications) were included to capture a holistic view. The searches were limited to publications from the last decade to ensure relevance to current policy and practice trends (2014–2024).

Inclusion and Exclusion Criteria

To maintain focus and quality, studies were included based on:

• Relevance to waqf and its socioeconomic or environmental roles in Malaysia or comparable contexts.
• Empirical or theoretical contributions to waqf governance, public attitudes, or green economy integration.
• Availability in English or Malay.

Certain criteria were excluded because:

• The studies were unrelated to waqf or sustainability.
• Non-academic sources lack verifiable data.
• There were duplicated publications or outdated materials predating 2013.

This filtering process enhanced the validity by ensuring the dataset was both relevant and credible.

Data Extraction and Management

Key information was systematically extracted from each study, including research objectives, methodologies, findings on public attitudes, institutional challenges, and waqf’s role in sustainability. Data were organized using qualitative analysis software to facilitate coding and thematic synthesis. This process involved identifying recurring themes, contradictions, and research gaps, supporting a structured interpretation of the literature (Kamarubahrin et al., 2019).

Analytical Framework and Thematic Coding

The study employed thematic analysis to interpret qualitative data, a method that enhances reliability by providing a transparent coding scheme. Themes were developed inductively based on the literature and included public perceptions, regulatory frameworks, managerial practices, socioeconomic impacts, environmental initiatives, and challenges of integration. Coding was performed iteratively, with cross-checking to ensure consistency and minimize researcher bias. This approach aligns with best practices in qualitative research and waqf accountability studies (Cole, 2024).

Ensuring Reliability and Validity

• Triangulation: Multiple data sources and types (academic articles, policy documents, case studies) were triangulated to corroborate findings, reducing single-source bias.
• Peer Review and Expert Consultation: Preliminary findings were received from experts in waqf and zakat to validate interpretations and contextual accuracy.
• Transparency: The methodology, including search terms, inclusion criteria, and coding procedures, was thoroughly documented to facilitate replication.
• Reflexivity: The research team maintained awareness of potential biases and actively sought to mitigate them through reflective practices and methodological rigor.

Limitations of Research Design and Ethical Considerations

The study acknowledges limitations inherent in qualitative reviews, such as dependence on available literature and potential publication bias. Ethical considerations were minimal, as the study relied on publicly available data; however, care was taken to accurately represent all perspectives. This structured and comprehensive methodological framework ensures that the study’s findings on the role of waqf in Malaysia’s socioeconomic sustainability and green economy are robust, credible, and actionable. It also provides a replicable model for future research in Islamic finance and sustainable development contexts.

FINDINGS AND DISCUSSIONS

Malay Muslims in Malaysia demonstrate a complicated attitude toward waqf, comprising moderate awareness but with a large deficit of understanding and trust. Young Malay men, who are Muslim, have positive attitudes toward cash waqf, however, overall awareness of cash waqf differs significantly among states due to fragmented institutional structures.

The key findings are highlighted and discussed as follows:

• Bias towards a particular waqf: Communities tend to prioritize religious projects (e.g., the construction of mosques) over general socio-economic development projects that could benefit a larger number of people. Malaysian waqif (waqf donors) have preferences for various waqfs and are motivated by considerations such as personal, family, community (ummah), and humanitarian concerns. An analysis adopted a maqāṣid approach (objects of shari’ah) and shows that these are a significant determinant of phase waqif preference, especially for waqf-based QB (qardhul hassan) financing, which aims to help the poor and needy. Such preference suggests a willingness to use the waqf for the sake of creating ventures that serve the interests of all classes of society, demonstrating a favorable social orientation of the Malaysian waqif.
• Cash waqf acceptance: There is growing awareness, yet knowledge is limited, with some misunderstanding waqf for philanthropy. Cash waqf, unlike that in the form of real property, is widely acceptable in Malaysia. The 77th Fatwa Committee of the National Council of Islamic Religious Affairs Malaysia permitted cash waqf in 2007. Subsequently, the state fatwa committees stipulated conditions for its use, which include preserving and maintaining the original purchasing power of the endowed money and ensuring compliance with Islamic law in the purchase of assets. Research reveals that personal religiosity, trust in waqf institutions, and the ease of endowing a cash waqf play significant roles in fostering a positive attitude and behavior toward participating in cash waqf. This acceptance is driven by government operations and the development of dedicated waqf institutions to grow cash waqf as a versatile and efficient Islamic social finance instrument.
• Trust barriers: Poor governance reduces inputs, fed by negative media coverage regarding the misuse of funds. Notwithstanding acceptance, there are trust issues that pose a significant obstacle to waqf participation. Among the governance problems which have the potential to further reduce public confidence in the administration and management of waqf program principles and regulations, are lack of independence between trustees and managers, absence of accountability, limited competency of the managers in waqf to manage assets and finances, and lack of transparency in reporting waqf asset performance. Among the examples is Malaysia, where the Majlis Agama Islam serves as the trustee and manager of waqf assets, leading to a conflict of interest and a weakness in checks and balances. Opaque financial statements keep devotees in the dark about whether their waqf contributions are used for the intended purposes, limiting their confidence and commitment. By addressing these trust barriers towards the professionalization of waqf and improving the governance structure, public confidence and involvement can also be promoted.
• Demographic influences: In Malaysia, demographic characteristics play a major role in determining the attitude towards waqf contribution. According to the study, women are higher than men in terms of being contributors to cash waqf because of the increasing involvement of women in the labor force as well as the higher education level. Age also matters where mature people, 30 years and older, are more likely to donate as they have a stable career and assets and they can also donate the property or cash waqf. This is consistent with the Life-Cycle Hypothesis of Saving which posits that as individuals age and become more established in their careers, they are more financially able to contribute (Kadir et al., 2021). Such demographic analysis enables waqf institutions to customize their marketing and outreach efforts to various population groups.

The results are depicted in the quadrant matrix diagram (Figure 1). These perceptions underscore the need for targeted education and awareness campaigns to shift the mindset from viewing waqf solely as a religious instrument to one that prioritizes socioeconomic development.

Figure 1: Key findings

Socioeconomic and Environmental Convergence Opportunities

In further addressing and supporting the findings, the transformative potential of waqf in the development of Malaysia can be alleviated through these initiatives:

Socioeconomic Initiatives

• Poverty Reduction: Cash waqf models demonstrate the ability to reduce poverty by up to 50% when combined with state development and social welfare programs.
• Education and healthcare: Schools and clinics have been financed by typical waqf properties, with contemporary applications such as corporate waqf scholarships augmenting human capital.
• Employment: Waqf-financed businesses, such as those in agriculture in the state of Kedah, have led to increased employment and the adoption of environmentally friendly practices.

Environmental Initiatives

• Renewable energy: For example, waqf solar projects on mosques serve to decrease energy bills by ~RM500 per month per site (Azura; Jaffar et al., 2023).
• Circular economy projects (e.g., Waqf forests and coastal conservation projects, e.g., mangrove restoration) that help reduce climate risks, such as flooding.
• Green financing: Tools such as Cash Waqf Linked Sukuk (CWLS) help raise money for solar farms and waste-to-energy plants (Zaidi).

Similar outcomes acknowledge by Shaharuddin et al. (2024) that these are opportunities where waqf could act as a driver for inclusive green economy growth, which resonates with national policies such as the Sustainable and Circular Economy Roadmap.

Challenges in Integration (Figure 2):

Societal Challenges

• Awareness barriers: 70 per cent of Malaysians believe waqf is only religious; they do not understand its socio-economic function.
• Cultural orientation: The Malay culture and tradition result in communities prefering to have a physical asset (such as land for mosque) compared to cash waqf for general development.
• Trust shortages: Attention to high-profile scandals involving charitable donations had discouraged contributions and called for robust accountability mechanisms (Abdul Shukor et al., 2019).

Regulatory Challenges

• Disjointed governance: All the state Islamic Religious Boards (Majlis Agama Islam) are governed by different laws, which complicates a nationally coordinated system of operation (Mukhlishin et al., 2024). For example, based on population density, such as the urban poor population in the larger cities.
• Outdated frameworks: Legal restrictions limit asset utilization, with 60% of waqf land remaining undeveloped due to bureaucratic hurdles.
• Green Gaps: No regular guidelines for suggesting to which projects or sectors waqf money be directed with regards to the environment.

Figure 2: Waqf Attitudes Challenges Model

Managerial Challenges

• Assets underutilization: weak administration denies return maximization for productive investment.
• Transparency gaps: Limited availability of financial statements to the public erodes confidence in the related entities.
• Technical expertise gaps: There’s a lack of infrastructure for green projects (e.g., solar infrastructure) in many institutions.

Green Economy Alignment Challenges

• Perspective disjunction: Conventional waqf structures rarely incorporate environmental factors into their key performance indicators (KPIs), hindering alignment with green objectives.
• Capital bottleneck: The respective capital cost for green projects is highly upfront, while a fragmented endowment of waqf exists.
• Policy gaps: National green initiatives, such as the Green Technology Master Plan, lack explicit approaches for integrating waqf.

As such, the Malaysian waqf ecosystem is currently at a crossroads: while conceptual barriers and administrative disarticulation hinder advancement, innovative models, as previously elaborated, offer promising avenues to promote social and economic welfare, as well as mitigate environmental impact. Success will depend on comprehensive reforms, including legal reforms and suitably adjusted regulations, as well as national awareness-raising campaigns and the introduction of waqf into policy frameworks concerning the green economy. Without mitigating these multifaceted challenges, waqf will never be realized as a sustainable development instrument.

Implications of the Study

The study reveals the low level of knowledge of waqf, particularly cash waqf, among the Malays. This issue is due to cultural and social influences, limited promotion, and a lack of understanding. This low knowledge of the waqf seriously limits waqf as an instrument for socioeconomic sustainable development and the green economy. Hence, waqf stakeholders and policymakers need to put more effort into designing and launching challenging and interactive educational campaigns aimed at raising awareness about waqf concepts and merits, focusing on younger age groups and non-Muslims to expand the waqf domains. It is also vital to develop trust in waqf institutions, as the acceptance of cash waqf (JAM, 2022) is highly related to trust in institutional maturity and accountability.

Furthermore, the study notes that to catalyze waqf in Malaysia’s green economy, the regulatory framework must be harmonized across states and jurisdictions, and governance strengthened to address excessive fragmentation and underutilization of waqf. Policymakers may consider establishing clear policy frameworks for utilizing waqf assets in environmental projects (e.g., renewable energy, sustainable agriculture), also to motivate the waqf sector toward achieving national sustainability objectives. This would solidify the waqf’s function as a driver of pro-poor, inclusive green growth and neighbor poverty reduction, alongside current government programs.

The research highlights the untapped potential of waqf in addressing both income inequality and environmental issues. If Malaysia mobilizes its waqf assets for socio-economic development and green projects, it will enhance long-term resilience and wealth sharing. This twofold effect is consistent with the Islamic emphasis on social justice and environmental care and affirms the relevance of waqf towards current sustainable development.

LIMITATIONS OF THE STUDY

The research on the public perception of waqf and its involvement in promoting economic sustainability: A case of Malaysia’s green economic strategy has several limitations:

Limited Empirical Data and Scope

The literature on waqf in Malaysia, including this paper, is largely based on qualitative and theoretical bases, rather than solid empirical evidence. Several previous surveys indicate that waqf research still has deficiencies, lacking large-scale and representative studies or longitudinal data to capture people’s attitudes and behavior adequately. This shortcoming hinders the generalization of findings across diverse Malaysian populations (the country comprises 13 states) and regions, given the varying awareness and practices between states and among ethnic groups.

Sampling and Geographic Constraints

The sample of the study might be limited in terms of geographical or demographic distribution, typically centering on selected Muslim community groups or cities, such as Kuala Lumpur and Selangor. This restricts what is known about rural, or minority-ethnic, attitudes which are important for a complete understanding at a national level. Moreover, use of specific sampling method to select waqf respondents in waqf research, say convenience sampling method which is the most popular sampling method used in various waqf surveys, might cause the same biases and subsequently influence the representativeness of them.

Responses Affected by Poor Awareness and Comprehension

A major challenge is the lack of public knowledge and understanding about waqf, particularly cash waqf, which might affect the validity of self-reported attitudes and intentions as in the case of discussions with random participants including the researchers. Future survey respondents may confuse waqf with other Islamic financial tools or the survey is unclear as to the socioeconomic and environmental locus of waqf which could result in misinterpretation of survey or interview questions.

Institutional and Regulatory Complexity Clearly Underestimated

Although the study highlights regulatory and managerial issues, Malaysia has a complex waqf governance system with several State Islamic Religious Councils, each with different regulations and enforcement capacities that may not be adequately reflected or analyzed (Mustafa et al., 2024). This intricacy makes it challenging to derive clear policy recommendations from our results that can be applied universally to all states.

Emphasize Perceptions More than Behavior Outcomes

The focus is mainly on attitudes and perceptions, and not on the behavior of the waqf giving, or the impact of waqf initiatives on socioeconomic sustainability and green economy programs. This constrains the ability to measure causality or the success of waqf integration in environmental and economic planning.

Time and Resource Constraints

As identified in some similar studies, a shortage of time and resource input to data collection and analysis may limit the study depth and breadth, and lead to neglecting emergent trends or complex community behavior.

These limitations suggest that, despite the study’s significance in generating potential for understanding public opinions and the role of waqf in Malaysia’s sustainable development, future research should expand its scope to other provinces, incorporate mixed methods that consider quantitative behavioral data, and provide an in-depth view of institutional complexity. These voids can be filled for a more robust evidence base for effective waqf policy and practice that can be geared towards Malaysia’s green economy objectives.

RECOMMENDATIONS FOR FURTHER RESEARCH

Future studies should be broader in terms of demographics and cross-community, with overlap between non-Muslim and secular groups of Malaysians. This is so that the public can be aware of the perceptions of people and their readiness to contribute through waqf, including cash waqf. This would also yield a deeper sense of popular opinion and new areas for waqf expansion in a multi-ethnic society.

Additionally, it is recommended that qualitative inquiries into institutional views be conducted. Comprehensive qualitative research work on waqf institutions, regulatory bodies, and community leaders needs to be undertaken to investigate the institutional challenges and best practices in waqf management and the “green economy” inclusion. This type of research can unearth political, transparency, and capacity obstacles, and hence inform customized reforms. This also suggests that there is a need to conduct an impact assessment of green waqf projects. Evidence-based studies on the socioeconomic and environmental impacts of implemented green waqf projects (e.g., solar waqf, agro-waqf) would confirm the extent and scale of impact. Longitudinal studies could help identify implications for poverty reduction, employment, and carbon footprint, thereby supplementing policy and investment decisions.

With the rise of new waqf instruments, such as the green sukuk, which is linked to waqf assets, new patterns of mobilizing capital for sustainable projects may be discovered through innovative waqf financing models that can be explored further, including through Islamic finance instruments. Feasibility, regulation, and market acceptance should be studied to validate waqf’s position on the green economy of Malaysia. In conclusion, the present study proposes a multi-pronged strategy of public education, institutional reform, and innovative financing as three critical dimensions to unlock the full potential of waqf in meeting the socioeconomic sustainability and green economy aspirations in Malaysia. To achieve these objectives, prospective studies covering wider demographic and institutional insights into green waqf, as well as empirical analysis of its implications, would be essential.

CONCLUSION

This paper highlights the importance and opportunities for waqf to contribute to the development of a sustainable socioeconomic under the green economy strategy in Malaysia. Despite its history spanning centuries in promoting education, health, and community development, waqf remains an underutilized tool in addressing modern-day issues, including environmental sustainability and inclusive economic growth. An examination of public opinion reveals a reasonable degree of awareness and acceptance, particularly among younger Malays; however, significant deficits persist in recognizing the full socioeconomic and environmental potential of waqf. These results underscore the pressing need for targeted education programs and trust-building efforts to enhance public participation and support in waqf, thereby diversifying it beyond its traditional religious role.

Additionally, the research suggests that there are promising avenues for waqf to be integrated into Malaysia’s green economy through innovative modes, such as cash waqf, solar waqf, and agricultural waqf, which can simultaneously address poverty alleviation, income disparity, and environmental preservation. Nevertheless, this potential remains unfulfilled, due to complex bottlenecks such as sectoral regulatory frames, inefficiency in program management, public attitude, and little harmonization within the purpose of national green projects. Addressing these obstacles requires a holistic policy approach, aligned governance systems, and the development of institutional capacities to mobilize and manage waqf resources optimally for sustainable development objectives.

Finally, waqf offers a distinctive and culturally salient tool that could be used to reconcile Muslim values on social justice and environmental protection with the aspirations of the Malaysian population toward a sustainable, inclusive, and low-carbon economy. As long as public awareness, regulatory framework, and innovative financing mechanisms are in place, waqf can be reinvented as a driving force of change towards a sustainable socioeconomic and environmental landscape. This paper has both academic and operational implications for policymakers, waqf institutions, and others interested in aligning religious forms of philanthropy with contemporary sustainability concerns. It is recommended that future research further enhance empirical studies and craft pragmatic models to optimize the impact of waqf, thereby remaining a crucial foundation for Malaysia’s sustainability project.

ACKNOWLEDGEMENTS

We want to thank the Dean, Faculty of Business and Management, Universiti Teknologi MARA Cawangan Selangor, Puncak Alam, respondents, and co-researchers for their helpful feedback and support.

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