Determination of Professionalism and Transparency and Its Implications for the Financial Performance of Zakat Institutions

Abstract

The objective of this study is to determine the influence of the professionalism and

transparency of zakat management on financial performance, especially in the case of

the Amil Zakat Institution of Daarut Tauhid Peduli Jabodetabek. The method used in

the research is SEM (structural equation modeling) using AMOS, with 156 respondents.

The results show that: (1) professionalism has a negative and insignificant impact on the

transparency of zakat management; (2) professionalism has a positive and significant

impact on financial performance; and (3) the transparency of zakat management has

positive and significant impacts on financial performance. Moreover, the indicators

of competence have the highest loading factors of professionalism; the indicator of

information on fund management has the highest loading factors of transparency;

while the indictor of measurement of economics has the highest loading factor of

financial performance. To sum up, this research suggests that zakat institutions should

improve their transparency and professionalism in order to improve their financial

performance in the future.