Applications of Waqf -Featured Fund in the Malaysian Islamic Fund Management Industry: A Comparative Study

Historical evidence demonstrates the enormous role waqf institutions have played in the development and advancement of Muslims throughout the Muslim history. With the proper structure and strategy, waqf contributes to numerous spheres of life, including mainstream economic development. Contemporary development of Islamic finance has enabled the waqf concept to be linked to various financial products, including Shariah-compliant investment instruments, such as, Islamic unit trust funds and Islamic wholesale funds. This paper aims to highlight the current applications of the Waqf-Featured Fund (WFF) in the Malaysia Islamic Fund Management Industry. This is in relation to the launch of a new WFF framework to facilitate the offering of Islamic funds with waqf characteristics. The study took both qualitative via in-depth semi-structured interviews with eleven (11) WFF stakeholders, as well as, analyzing of policy documents, journal articles, books, and online resources. The findings shed light on the current issues and challenges confronting waqf projects in Malaysia, as well as the current guidelines and essential requirements for the WFF, the current application of the WFF in the Malaysian


Introduction
Since the early 1970s, the global Islamic financial services industry has grown consistently and exponentially, with Malaysia has been at the forefront of numerous industry breakthroughs and innovations.Given Malaysia's global leadership in Islamic Fund Management (IFM) segments and regional leadership in Social Responsibility Investing (SRI), the next stage of development potential is the incorporation of waqf or Islamic endowment, which can be a tool for growth in the social finance space.
Throughout Islamic history, waqf or Islamic endowment is one of the socioeconomic institutions in Islam that has historically encouraged Muslims to be creative and innovative in generating revenue and providing various goods and services to Muslim societies (Mohsin, 2013).Although the concept of waqf existed before Islam, Islam accepted it and developed it into a legal framework.As a result, it became one of the devices developed by Muslims to address various critical needs in various sectors that the state or government new funds.The beauty of this institution is that it is one of the redistribution institutions (Cizakca, 2011).
Currently, waqf institutions in Malaysia have reached their height and stagnation over the years, and waqf lost much of its dynamism for many reasons.According to 2013 statistics published by Jabatan Wakaf, Zakat dan Haji (JAWHAR), Malaysia had 11,091.82hectares of waqf land valued at RM1. 18 billion (Sayuti et al., 2020).According to Chief Secretary to the Malaysian Government Tan Sri Mohd Zuki Ali, between the 9th and 11th Malaysian Plans (RMK-9 to RMK-11), the Malaysian government allocated RM299.33 million to eighteen (18) highimpact projects through the provision of waqf property development allocations (Bernama, 2021b).Regrettably, it is estimated that 92.9 per cent of Malaysia's waqf land is still undeveloped (Zakaria et al., 2014).Ironically, thousands of hectares of waqf land remain undeveloped, given the current economy's high demand for land and property (Muhammad, 2018).Meanwhile, JAWHAR could not provide data on other waqf asset classes, but they are expected to be extremely valuable and underutilised (Zain & Sori, 2020).
The need to convert underperforming waqf assets to high-quality assets, as well as the recent call for waqf revival, are critical to the Islamic philanthropy sector's rapid growth.However, the overall development of waqf assets administered by State Islamic Religious Councils (SIRCs) in Malaysia has been progressively slow (Zakaria et al., 2014), owing to capital constraints (Saifuddin et al., 2014;Hasan & Sulaiman, 2016), and low liquidity of waqf assets (Mohsin & Mohammad, 2011).In addition, numerous factors have been identified as contributing to funding constraints, including internal administrative issues (Khamis & Mohd Salleh, 2018;Mohd, 2015), such as the continuous collection of waqf, operationalisation of cash waqf funds, and cash waqf awareness (Adeyemi et al., 2016;Kamaruddin et al., 2022;Noordin et al., 2017;Noorhayati et al., 2017;Pitchay et al., 2018).
As a result, the waqf stakeholders must prioritise the development of new waqf assets and the investment of waqf proceeds in financial instruments for capital growth, capital gains, and ultimately to increase the value of waqf assets.Arshad et al. (2018) emphasised the importance of developing waqf assets because it is consistent with the objective of Shariah (Maqasid Shariah).The Maqasid Shariah emphasises the value of community (ummah), in which all waqf assets must be maintained to generate returns for the needy beneficiaries.
Currently, the majority of SIRCs' waqf administrators are hesitant to invest their collected cash waqf in the IFM industry, despite the potential for substantial returns, but due to a shortage of investment experts and knowledge on waqf investment management.As a result, traditional development strategies approaches, such as Islamic fixed deposits in Islamic banking institutions, are implemented at a low rate of return, exposing them to inflation risk (Hasan & Sulaiman, 2016).Furthermore, due to constraints and a lack of competence in formulating standards and strategies for waqf asset portfolios in IFM, waqf administrators frequently avoid investing in the collected waqf funds for fear of loss.Nonetheless, the number of waqf investments and waqf-related investment products is relatively new and underdeveloped in the Malaysian IFM market, with opportunities for further improvement and refinement.
This paper aims to analyse current guidelines and requirements rectified by Securities Commission Malaysia for the application of Waqf-Featured Fund and to understand the current application of Waqf-Featured Fund in the Malaysia Islamic fund management industry.This study comparatively analyse the current application of four waqf-featured funds in Malaysia which involved document analysis of the guidelines, prospectus and product highlight sheet.The noble of this study lies in the proposal for the future application of Waqf-Featured Fund from the collection of funds, investment structure, distribution process and waqf reporting.

Literature Review
The Concept of Waqf  2015), waqf refers to making a property invulnerable to any disposition that leads to the transfer of ownership and donating the usufruct of that property to beneficiaries.Abu Zuhrah (1959) expresses a similar view, adding that the benefit must be charitable and consider the waqif's request.According to Kahf (1999), the perpetual generation of benefits from waqf is a mechanism that contributes to raising the ummah's standard of living and alleviating hardship and poverty among the poor and needy.Therefore, waqf assets should be used to finance sustainable development goals (SDGs) to eradicate poverty in all its manifestations, address environmental and health issues, and combat inequalities while ensuring that no one is left behind.
To summarise, contemporary scholars and jurists agree on two fundamental principles: the waqf asset must be preserved, and the revenue generated by the asset must be used for the benefit of the community.As a result, Sadique's (2010) definition is more pertinent and current which retaining a usable property while preserving its corpus by prohibiting the waqif or any other person from using it in the direction of an existing and permissible (charitable) avenue for gaining proximity to Allah.
While waqf is a component of a muamalat contract, it is considered an act of worship to Allah in Islam.It is a noble goal to benefit all people regardless of their social status or religion.It serves various humanitarian purposes, including education, socio-economic development, assisting the poor, and contributing to community services.It is not restricted to religious purposes alone (Abu Zuhrah, 1959).

The Legitimacy of Cash Waqf on the Financial Assets
At the end of the 16th century, the Ottoman Empire has widely utilised cash waqf, which was critical to the empire's economy (Çizakca, 1998).Cash waqf was distributed to entrepreneurs and public services such as healthcare, education, water channelling, bridge construction, and road construction.However, from the late nineteenth century, the use of cash waqf has declined due to mismanagement, colonisation, and secularism.(Ahmed, 2004;Mahamood, 2006).
According to Mohsin (2013), cash waqf is the mobilising of funds by waqif, which comprise of individuals, companies, institutions, corporations, or organisations private or public, and the perpetual dedication of their usufruct or revenue to the welfare of the society considering the policy and guideline provided by the waqif.Its objective was to raise public funds for pooling as a waqf asset.It is managed to generate revenue and maintain its initial value to grow, or at the very least to ensure its perpetuity.The proceeds from the investment will be distributed to the beneficiaries.The consensus of Muslim jurists agrees on the legitimacy of cash waqf.
The primary basis for the permissibility of cash waqf stems from Islamic legal maxim istihsan bi al 'urf (juristic preference based on custom) as stipulated by the Hanafi school (Mauluddin & Rahman, 2018).Imam Zufar of the Hanafi school approved the dedication of all movable properties as waqf, including waqf of the dinar and dirham (cash waqf) as the capital in business dealings based on mudarabah (profit sharing), and the proceeds can be directed to the charitable purposes of waqf (Mohsin, 2013).Maliki school, Shafi'i school, and Hanbali school also agreed on the validity of both immovable and movable assets as the subject matter of waqf, including cash waqf if the cash provides continual benefit and the intrinsic value is retained (Abu Zuhrah, 1972 ;Mauluddin & Rahman, 2018).
Furthermore, according to Resolution No. 140 (16/6) of the International Council of Fiqh Academy (IIFA), cash can be endowed as waqf for it has the capability of keeping the principal intact and providing benefits.Muslim jurists have widely accepted movable assets in cash waqf and other financial assets in the modern application of waqf, so their establishment must adhere to the exact legal requirements as immovable waqf (Husain & Rashid, 1979).Thus, the current requirement to establish cash waqf may expand the window of opportunity for waqif to establish cash waqf that complies with the requirements of Muslim jurists.
Financial assets are intangible properties that claim an entity's ownership or contractual rights to future economic benefits.

Research Methodology
The primary data used a qualitative approach via in-depth semi-structured interviews with eleven (11) interviewed samples.Two (2) representative from Kenanga Islamic Investors Berhad (KIIB) and one (1) representatives from Kenanga Investors Berhad (KIB) as fund manager; two (2) representatives from the Islamic Banking and Finance Institute Malaysia (IBFIM) as Shariah advisor; three (3) representatives from Yayasan Waqaf Malaysia (YWM) as waqf administrator; two (2) representatives from Yayasan Pembangunan Ekonomi Islam Malaysia (YaPEIM); and a representative from MATCH Foundation (MATCH) as distribution agent were interviewed.The informants chosen to represent the Waqf-Featured Fund (WFF) framework's primary stakeholders in terms of investment objective, distribution policy, eligible waqf recipients, and disclosure of material information in offering documents, websites, and periodic reports.
In the interviews, the questions asked followed a rough outline, then branched into more specific topics depending upon stakeholders being interviewed and their relevant field and experiences.It focuses on their perception of the WFF implementation in the Islamic fund industry and their role, what they perceive to be the issues and challenges confronting waqf projects in Malaysia, their role in resolving these issues, the feedback on the current guidelines and requirements for the WFF rectified by SC as well as the current application of WFF in the Malaysia IFM industry, and improvement on the current WFF structure.The data was then analysed using descriptive analysis.
The secondary data obtained from publicly available resources, but not limited to, textbooks, scholarly papers, prospectus, product highlight sheet, information memorandum, technical perspectives, and online periodicals on the topic and challenges of implementing the WFF and these are analyses performed to support the refinement process of the critical contents of this study through validation by participating stakeholders on the accuracy of information cited.

The Structure of IUTF and IWF in Malaysia
An According to ISRA, IFM involves a group of investors channelling their surplus money to a legal entity known as a 'fund', which pools the collected funds and invests them in a diversified securities and other assets portfolio to achieve specific financial goals (ISRA, 2015) and Figure 1 summarise the fund management process.IFM offers a diverse range of Islamic CIS in Malaysia, including IUTF, IWF, Islamic Private Retirement Schemes (i-PRS), Islamic Exchange Traded Funds (i-ETF) and Islamic Real Estate Investment Trusts (i-REIT) (SC, 2017b).

SC then launched the Islamic Fund and
Wealth Management Blueprint in 2017 to outline plans and recommendations to counter impediments to growth and innovation for financial development, including the critical role of waqf in the IFM industry (SC, 2017b).The Blueprint had identified the development of waqf as one area of the significant potential for social development, greater public good and wealth distribution.Various types of waqf models are being proposed in the IFM industry, namely waqf i-REIT (Hasan & Sulaiman, 2016), waqf i-ETF (Jamaludin, 2018), waqf i-PRS (Jafri & Mohd Noor, 2019) and waqf IUTF (Sulaiman et al., 2019;Sulaiman & Hasan, 2020).
Concerning the viability of waqf and i-REIT, the implementation in Malaysia by Waqaf An-Nur Corporation serves as a launchpad for future viable waqf i-REIT, emphasising the importance of waqf properties generating sustainable income for their beneficiaries.It is pretty fascinating to learn that 2.47 percent of Al-'Aqar Healthcare REITs units have been placed under the waqf initiative and have contributed to society's well-being in religious, social, and economic areas (2021).36 In terms of i-PRS and i-ETF as suggested by Jamaludin (2018) and Jafri & Mohd Noor (2019), both currently account for a tiny proportion of IFM Industry as of December 2020 with a total AUM of RM1.53 billion (0.71%) across eight (8) i-PRS providers and a total AUM of RM 0.55 billion (0.25%) across two (2) i-ETF providers (SC, 2021a A representative from YWM stated that for many, a lack of access to and opportunity for education perpetuates the cycle of poverty.This means that the poorest children face an uphill battle to improve their circumstances.One way they hope to combat poverty is by providing opportunities for children to receive a quality education.YWM's waqf education scheme invites the public to perform waqf with cash by providing a sustainable solution that enables some of the poorest children to access education, thereby emancipating them from poverty and hardship.
Additionally, he stated that the cash waqf collected from the scheme will be invested and the earnings will be used to fund charitable activities related to education.The waqf funds will be invested in permanent assets that support educational objectives, subject to suitability and applicable rules.The proceeds will be used to purchase educational equipment for the community's welfare; to purchase equipment or clothing for underprivileged students; and to finance the cost of renovating or adding educational facilities at any appropriate educational centre, as well as to assist in financing the cost of education required.
The collection of YWM's waqf education scheme continues to be small and underfunded.Lack of funds is not a new problem for waqf (Abd Mutalib & Maamor, 2018).SIRC in its effort to develop waqf assets are a lack of funds.Several factors contributed to the lack of funds, including low rental rates at the waqf facility (Mohd Ali et al., 2016).Additionally, Abdul Aziz et al. (2019) asserts that the majority of waqf stakeholders lack access to a diverse range of investment strategies.The waqf institution's funds are insufficient to cover the necessary costs (Mahmood et al., 2017).According to Saad et al. (2019), Malaysia is not alone in experiencing a fund shortage; other Muslim countries such as India, Yemen, and Indonesia are also affected.
The representatives from KIIB stated that the establishment of WFF is revolutionary for the waqf industry because a portion or all dividends generated will be distributed to waqf and may last in perpetuity based on the analogy of the Amanah Saham Bumiputra (ASB), which has been operating for 32 years and has distributed dividend annually since 1990.He also stated that the WFF will be professionally managed by FMC, overseen by Shariah advisors, trustee to safeguard the fund's assets, audited by an external auditor, and regulated by the SC.
Concerning the WFF's challenges, a All representatives from YWM, MATCH, and YaPEIM concur that awareness of healthcare waqf remains low.Waqf is practised in a traditional manner, which means that it is limited to the construction of mosques, schools, and graveyards.This needs to be expanded so that the benefits of waqf assets can be extended further to assist more people in need, including those receiving health care.Waqf assets may be expanded or invested in healthcare facilities if they meet Shariah's criteria, which include renting waqf land for healthcare facilities, cash waqf for costly medical equipment, and  REIT, 2021).He also stated that elements of innovation and creativity in waqf, as well as progressive fatwa and easy access to finance, as well as a strong legal framework and strong governance, are necessary to resolve the issues and challenges for the successful management of waqf assets, particularly in healthcare waqf.

Community Empowerment
The history of waqf on community development demonstrates that this method has generated enormous benefits over the last century.According to a representative from KIIB, waqf was applicable to all community and economic sectors during the Ottoman empire, and waqf has reached its peak and plateaued over the years, losing much of its dynamism for a variety of reasons.
According to literature, the revenue from Ottoman waqf was estimated to be approximately one-third of the state's revenue in the 18 th century.Prior to the formation of the Republic of Turkey in 1923, it is estimated that over threequarters of a country's arable land was waqf property (Kuran, 2001).
According to the representative of YaPEIM, waqf and community empowerment should place a greater emphasis on critical areas such as poverty, microfinance, entrepreneurship, and corporate social responsibility (CSR) to develop more effective tools for community improvement.He also mentioned that, because of supply-side sluggishness and a lack of supporting services, most poor people lack access to financial services, which is a barrier to community empowerment.His team discovered that, because of commercialization, microfinance programmes frequently overlook the ultra-poor, making them less effective at reducing poverty.
Representative from IBFIM mentioned that cash waqf can be utilised to fund and set up training and business support centres, which they can be used by the beneficiaries to acquire knowledge and improve their skills, enabling them to generate a higher income, and subsequently, become marketable clients for microfinancing.This is consistent with IBFIM's mission as a lifelong learning institution specialising in technical certifications for industry.He also mentioned that the recurring costs can be controlled by taking a fee-in-kind, such as requiring the skilled person to train another client.Therefore, there will be no monetary fee involved for training facilities if the trained person could further train other people, making the process financially sustainable.As a result, maximum leverage can be acquired from the cash waqf for establishing these centres that can train the first several batches of people.

According to
YWM, community empowerment cash-based waqf scheme by YWM invites the public to perform waqf and the cash waqf collected will be invested, and the profits (gains from the investment) will be used to finance economic activities in accordance with applicable laws and regulations.The resulting benefits will be used to fund the acquisition of tools that can be used to improve the community's economic situation, financing the purchase of any product from an Islamic merchant where the product will be used to aid those who qualify, and assist any trader who is experiencing genuine difficulty because of a circumstance affecting their business.
According to a KIB representative, the adoption of waqf approaches that encourage endowments to be made through a variety of methods utilising contemporary properties such as the implementation of WFF is an excellent fit for this country.Additionally, she stated that WFF is a new product on the market, and the current capital market environment is not entirely stable because of COVID-19, which may pose challenges in implementing WFF where it could potentially be exposed to investment risk due to the level of uncertainty of achieving the expected rate of return.

Emergency Relief
According to a Match Foundation representative, flood is a natural disaster that occurs annually in Malaysia, and the recent COVID-19 pandemic has put some health systems under enormous strain and stretched others beyond their capacity globally, making it critical to establish an emergency relief fund for the purpose of channelling resources to those affected by climate change-related disasters as well as future pandemics in the form of waqf.Different levels of climate change-related disasters and pandemic cause different impacts on people, infrastructures as well as nature.As a result, the climate changerelated disasters and pandemic victims have difficulty to survive.
According to YWM, the concept of an emergency waqf fund is relatively new and implementation required additional research.Additionally, he stated that climate change-related disasters and pandemics cause widespread devastation and disruption.These effects, however, can be mitigated if appropriate emergency plans and mitigation measures are implemented promptly and coordinated responses are launched during and after the disaster.Climate change-related disasters and pandemics may have a negative impact on society, including economic losses, physical health, psychological effects, migration, and effects on worship.

According
to KIIB and KIB representatives, this is an opportunity to establish an emergency waqf fund as a launching pad for future climate changerelated disasters and pandemics, as well as to safeguard the lives and livelihoods of the most vulnerable.Both also stated that the government requires significant funding to provide relief and assistance in the recovery process, and that the establishment of an emergency waqf fund may alleviate some of the government's burden.According to the revised GUTF and LOLA Framework, a fund with the waqf feature is an IUTF or IWF that permits the unit holders to reserve their rights over the units they purchased and waqf either part or all the income that they received from the distribution.The guidelines also clearly emphasise that only IUTF and IWF complying with this Chapter 14 GUTF and Chapter 6 Part 1 of Section B LOLA Framework can present themselves as a fund with the waqf feature.This chapter further examines WFF framework requirements, including investment objective and distribution policy, eligible waqf recipients, disclosure in offering documents, and FMC's website, as well as disclosure in fund reports.

Investment Objective and Distribution Policy
The primary investment objectives of WFF have also been underlined by the GUTF and LOLA Framework, which are to provide income and allow its unitholders to contribute part or all the income received from the distribution for waqf.Therefore, the fund's distribution policy must require that a distribution percentage be channelled for waqf purposes.
According to Shariah Advisor at IBFIM, the applicable model under the WFF Framework is a waqf-dividend structure, which means that the endowed subject matter is the return or dividend of the WFF.SC recognises waqf on the entire dividend or a portion of the dividend only under the revised GUTF and LOLA Frameworks.Based on this waqf-dividend structure model, IUTF or IWF unitholders may channel part or all the income from the distribution for waqf as enshrined in the WFF framework.Figure 3

Disclosure in Offering Documents and FMC's Website
In ensuring the transparency of the waqf distribution to the beneficiaries, the revised GUTF and LOLA framework require the WFF to disclose detailed descriptions of the waqf arrangement in its product highlights sheet and prospectus (for IUTF) as well as disclosure document, information memorandum or product highlights sheet (for IWF), which must include the waqf initiatives and the waqf recipients' names.
Additionally, the WFF must disclose how investors can obtain additional information about the waqf beneficiaries and the status of the waqf initiatives.The WFF is also required to disclose its policies and the processes used to select waqf recipients and waqf initiatives and the circumstances under which the fund will replace existing waqf recipients or add new waqf recipients.Apart from that, the company that manages the fund is required to publish information about the waqf, the waqf recipients, and a link to the waqf recipients' websites on its website.The representative of KIIB stated that the provision expressly recognises the importance of good waqf governance practices and continues to update on what has been done by the appointed waqf institutions and bring issues to the investors as waqif so that the waqif can adequately monitor the status of waqf initiatives.

Disclosure in Fund Reports
The IUTF's and IWF's report must include a detailed breakdown of the total amount distributed to the waqf recipient(s) (and if applicable, further breakdown of payment to each waqf recipient) and the unitholders.The provision expressly recognises the critical nature of transparency in waqf reporting to ensure the waqf fund's sound governance, according to KIB and KIIB representatives.Given the trend in waqf management toward cash waqf, the requirement for transparency and accountability becomes critical.Accountability is critical in waqf, as it aims to ensure that social services are released to society adequately (Kamarubahrin et al., 2019).Indeed, the success of waqf in the past has been attributed to the trustee's accountability, and the decline of waqf has been attributed to the trustee's accountability deteriorating (Ayedh & Kamarubahrin, 2018).

Current Application of WFF in the Malaysia IFM Industry
As of 30 Makmur myWakaf Fund is available in ringgit, US dollars, and Australian dollars at an initial offer price of 0.2500 cents per unit and a minimum initial investment of RM200, USD200, or AUD200.The initial offer price of PMB-An-Nur Waqf Income Fund is RM0.5000 per unit, with a minimum initial investment of RM100 for retail investors and RM10,000 for corporate or institutional investors.The initial minimum investment in Kenanga Waqf Al-Ihsan Fund is RM1,000.00,while the initial minimum investment in Maybank Mixed Assets-I Waqf Fund is RM100, with both funds offering an initial offer price of RM0.5000 per unit.Table 3 summarises the initial offer price, minimum initial and additional investment for each WFF.needed innovation that could serve as a sustainable investment.This chapter further examines the current application of WFF in the Malaysian IFM industry on fund objectives, investment policy and strategy, distribution policy, waqf administrator and WFF stakeholders according to the interview with representatives from KIIB an KIB.

Fund Objective
Islamic fund pursues a variety of broad objectives, including growth, income, or a combination of the two.With regards to the WFF, it is unique in that it includes a philanthropic objective, with a portion of the derived income going to sectors such as education, healthcare, community empowerment, the environment, and religious activities.Each WFF is based on waqf principles, which encourage investors to direct revenue to groups or communities in need through the appointed waqf administrator.The following Table 5 summarises the objectives of each WFF and the purpose of the waqf associated with each WFF.Makmur myWakaf Fund, Kenanga Waqf Al-Ihsan Fund, and Maybank Mixed Assets-I Waqf Fund will generally distribute waqf generated by WFF income to healthcare, education, and community empowerment, and the waqf will generally provide new or improved related facilities and equipment.Additionally, both the Kenanga Waqf Al-Ihsan Fund and the Maybank Mixed Assets-I Waqf Fund will make distributions to the environment sector to support the establishment or improvement of existing environmental projects such as renewable energy, solid waste management, water waste management, reforestation, clean water, and affordable and clean energy.
In a unique way, the waqf distribution purpose of PMB-An-Nur Waqf Income Fund reflected general welfare and charity; management and donation to mosques; as well as human capital, development, education, and entrepreneurship.The existing WFF waqf initiative will generate significant awareness and interest from investors due to their altruistic nature, which is especially important in today's social climate, as it contributes to society empowerment and poverty alleviation.

Investment Policy and Strategy
All WFF in Malaysia adopts a Shariahcompliant mixed-asset or balanced Islamic fund strategy.Makmur myWakaf Fund is an income fund that seeks to provide investors with a consistent income stream from their investments.In contrast, PMB-An-Nur Waqf Income Fund, Kenanga Waqf Al-Ihsan Fund, and Maybank Mixed Assets-I Waqf Fund are income and growth funds that seek to provide investors with both a consistent income stream and capital appreciation.
All WFF seeks to achieve its objective by investing in a diversified Shariah-compliant investment across different asset classes.Makmur myWakaf Fund investments into the various asset classes may range between 10 per cent to 90 percent of its's Net Asset Value (NAV).By comparison, Maybank Mixed Assets-I Waqf Fund may invest between 30 percent to 70 percent of its assets in Shariahcompliant equities, Shariah-compliant equity-related securities, and Ringgit Malaysia denominated Sukuk and up to 20 percent in the Islamic money market.
As for PMB-An-Nur Waqf Income Fund and Kenanga Waqf Al-Ihsan Fund, Shariah-compliant equities shall not exceed percent of its NAV.Kenanga Waqf Al-Ihsan Fund investments in Sukuk shall not exceed 40 percent, while up to 100 percent for PMB-An-Nur Waqf Income Fund invests in a combination of Sukuk and Islamic money market instruments.The remaining portion of the Kenanga Waqf Al-Ihsan Fund's NAV will be invested in Islamic money market instruments and placed in Islamic deposits.
Foreign exposure is permitted for the Makmur myWakaf Fund in the Asia Pacific and globally, where the regulatory authorities are ordinary or associate members of the International Organization of Securities Commissions (IOSCO).Simultaneously, Kenanga Waqf Al-Ihsan Fund may invest up to 20 percent of its NAV in foreign markets.
Additionally, Makmur myWakaf Fund, Kenanga Waqf Al-Ihsan Fund and Maybank Mixed Assets-I Waqf Fund may also invest in Islamic collective investment schemes, including Islamic real estate investment trusts and Islamic exchangetraded funds.The Fund may also invest in Islamic CIS, including Islamic exchangetraded funds.The Fund may use Islamic derivatives such as Islamic futures and Islamic option contracts for hedging purposes.All WFF also may invest in Islamic derivatives, such as Islamic foreign exchange forward contracts and Islamic cross-currency swaps, mainly for hedging purposes.
As for performance benchmark, an index is used to measure a WFF's overall performance.It provides an indicative value of how much WFF's investment should have earned, which can be compared against how much it has earned.Ideally, a WFF's target should be to match its benchmark return.Makmur myWakaf Fund performance benchmark is a composite of 50 percent 12-month Term Deposit-i Tawarruq of Bank Islam Malaysia Berhad and 50 percent FTSE Bursa Malaysia EMAS Shariah Index (FBMS) to reflect its investments into the various asset classes through a tactical approach.In comparison, the PMB-An-Nur Waqf Income Fund benchmark represents the combination of 50 percent FBMS and 50 percent Maybank 12-month Islamic deposit rate.As for Kenanga Waqf Al-Ihsan Fund benchmark is 60 percent FBMS and 40 percent Maybank 12-month Islamic Fixed Deposit rate, while the benchmark for Maybank Mixed Assets-I Waqf Fund is Maybank 12-month Islamic Fixed Deposit rate plus 2.00 percent.Table 6 summarises the WFF Investment Policy and Strategy.According to KIB and KIB representatives, the waqf administrator are selected as recipients of the waqf contribution by the existing WFFs: (i) The waqf institution must be authorised by the Federal or State Islamic religious council to act as a waqf administrator or collection agent for waqf purposes; (ii) the waqf institution must have an adequate governance structure and framework; (iii) the waqf institution must have an audited annual financial statement; and (iv) published the annual report on its waqf distribution and utilisation.
Additionally, both KIB and KIB representatives stated that if the appointed waqf institution ceases to meet the criteria, the FMC will take immediate action to remove it and replace it with another waqf institution that meets the criteria, subject to the approval of the WFF Shariah Adviser.Additionally, FMC may designate more than one (1) waqf institution to receive the WFF's waqf contribution.They also stated that, by subscribing to the WFF, WFF investors agree to delegate to FMC the authority to select or remove the waqf recipient, subject to the Shariah Adviser's approval.
Additionally, Makmur myWakaf Fund and Kenanga Waqf Al-Ihsan Fund established a joint management committee to oversee the distribution of the Waqf Asset by the waqf institution to the identified waqf projects for better governance.According to a representative from KIIB, the joint committee is responsible for determining how the Waqf Asset is to be distributed, approving the identified projects that the Waqf Asset is to be distributed, monitoring the progress of the identified projects, and approving the financial report prepared by the Waqf Institution on the administration of the waqf.

Conclusion
It is hoped that the implementation of WFF in the IFM industry will serve as the launchpad for new innovative IFM investment instruments and provide the public with access to Islamic funds that devote all or a portion of their investment returns to socially impactful waqf projects.Therefore, the proceed from WFF are expected to support the poor segment of society and all other activities that benefit the entire community, such as healthcare, education, community empowerment, emergency relief and other waqf projects in Malaysia.

Figure 2 :
Figure 2: AUM for IUTF & IWF, Islamic CIS, FMC, and Fund Management Industry Source: Extracted from SC Annual Report 2011-2020 illustrates the proposed conceptual model of WFF structure modified from the proposed model by Sulaiman et al. (2019).

Table 1 .
As a result, the percentage of the total NAV of the IUTFs and IWFs against the total NAV of Unit Trust Fund (UTF) and Wholesale Funds (WF) industry is 23.86 percent in 2020, up from 12.71 percent in 2011, as shown in Table2.
myThis journal is a member of and subscribes to the principles of the Committee on Publication Ethics (COPE)

Table 1 :
AUM of each Component of Malaysia's Islamic CIS Industry

Table 2 :
IUTF and IWF Comparison Compared to UTF and WF Industry

Table 3 :
Initial Offer Price, Minimum Investment, and Additional Investment This journal is a member of and subscribes to the principles of the Committee on Publication Ethics (COPE)

Table 4 :
Monthly AUM of WFFs in Malaysia Source: Data as of 30 November 2021 extracted from Refinitive Lipper for Investment Management

Table 5 :
WFF Objectives and Waqf PurposeThis journal is a member of and subscribes to the principles of the Committee on Publication Ethics (COPE)

Table 6 :
Summary of WFF Investment Policy and Strategy

Table 8 :
WFF Distribution Policy

Table 9 :
Appointed Waqf AdministratorThis journal is a member of and subscribes to the principles of the Committee on Publication Ethics (COPE) Malaysia Berhad, Bank Muamalat Malaysia Berhad, Maybank Islamic Berhad; and RHB Islamic Bank Berhad."Nur was incorporated in Malaysia on 25 October 2000 as a public company limited by guarantee under the Companies Act 2016.Waqaf An-Nur's charitable contributions have benefited patients' welfare, mosque activities, other welfares and orphanage/poor associations and include corporate responsibility programme implementations.Yayasan Waqaf Malaysia (YWM) is a national waqf entity.It was officially established on 23 July 2008 under the Trustees [Incorporation] Act 1952.YWM was established because of the efforts undertaken by 13 SIRCs and Department of Waqf, Zakat and Hajj of the Prime Minister's Department (JAWHAR) as Malaysia's national waqf entity.Currently, YWM is appointed mutawalli (manager or custodian of waqf) by eight (8) SIRCs in Malaysia.YWM is responsible for assisting, supporting and providing advisory services to SIRC on matters related to the development and reengineering of waqf assets and properties through traditional and contemporary Shariah-compliant structures and instruments."

Table 10 :
WFF Stakeholders This journal is a member of and subscribes to the principles of the Committee on Publication Ethics (COPE)