Reconceptualizing Islamic Philanthropy: Institutions, Ethics, and Development Pathways

Abstract

Islamic philanthropy, grounded in principles of zakat, waqf, and sadaqah, has historically supported communal welfare across Muslim societies. Despite its deep spiritual roots, its institutional relevance in addressing contemporary socio-economic challenges remains inadequately theorized. This article aims to reconceptualize Islamic philanthropy using the frameworks of institutional economics, moral economy, and third-sector governance. Employing a qualitative, conceptual methodology, the study analyzes Islamic philanthropic mechanisms as structured institutions with both normative and distributive functions. Key findings demonstrate that when modernized and integrated into regulatory systems, Islamic philanthropic institutions can effectively address poverty, promote ethical redistribution, and support sustainable development. The analysis bridges classical Islamic jurisprudence with contemporary social science theories, revealing the transformative potential of faith-based giving in pluralistic societies. The study also identifies governance and ethical tensions, proposing hybrid models that retain religious authenticity while meeting modern accountability standards. This work contributes both theoretically and practically to the discourse on Islamic finance, philanthropic ethics, and social justice. The findings inform scholars, policymakers, and practitioners on revitalizing Islamic philanthropy for contemporary global development.