THE EFFICIENCY AND EFFECTIVENESS OF ZAKAT INSTITUTION AND ITS CONTRIBUTION TO SUSTAINABLE DEVELOPMENT GOALS (SDGS): A CASE STUDY OF BAITUL MAL, ACEH BARAT DAYA REGENCY (2019-2023)

Abstract

Zakat institutions  play a crucial role in managing Zakat and non-zakat resources such as infaq, sedekah, waqf, and other social contributions to enhance social welfare in Indonesia. This can be achieved by considering various financial, social, and ethical aspects to align with sustainable development goals. This study examines the efficiency and the effectiveness of zakat distribution in the Aceh Barat Daya Regency Budget for the years 2019-2023 and its contribution to achievement of Sustainable Development Goals (SDGs). The research method employed is a case study and in-depth interviews with the Baitul Mal institution of Aceh Barat Daya Regency. The findings reveal that the Aceh Barat Daya Regency Government, through Baitul Mal, has implemented four SDGs programs: no poverty, zero hunger, good health and well-being, and quality education. The efficiency level of zakat distribution over the five years, measured by the operational cost ratio to total amil, was efficient, although 2021 was categorized as inefficient. Meanwhile, the ratio of operational costs to total collection and the ratio of HR costs to total collection were consistently efficient. The effectiveness level, measured using gross ACR and gross AR non-amil, was generally classified as moderately efficient, although 2019 and 2021 were categorized as ineffective.