Despite having Islam as the official religion in Malaysia, the Zakat Institutions
are governed separately by Islamic Councils of 13 states and a Federal
Territory of Wilayah Persekutuan Kuala Lumpur, rather than directly
controlled by the Federal Government. Employing different administration
enactments, it is expected that there will be variations in the management
practices of these institutions. While extensive literature exists on the
management of zakat, very few made the attempt to understand the underlying
structure of these institutions that form the basis of their management
efficiency. This paper aims to understand the governance structure of
Malaysian Zakat Institutions through their practice of management control
practices (MCP) and the level of managerial commitment. The MCP elements
studied include formal controls such as staff’s monitoring and performance
evaluation and informal controls such as usrah and tazkirah. A total of 133
questionnaires were received from managers of 10 Zakat Institutions. Findings
from the survey indicate usrah and tazkirah rank first and the use of report for
evaluation rank second as the most important means of controls. The results
also indicate variations in the types of control emphasized by institution in
different states. Managers were also found to be highly committed in their
work. Interestingly, it was also found that management control practices
increase level of staff commitment.
