Halal value chain integration in food court establishment through Cash Waqf Linked Sukuk: evidence from Indonesia

Hasibuan, Widya Sartika; Lubis, Irsad Article Halal value chain integration in food court establishment through Cash Waqf Linked Sukuk: evidence from Indonesia Cogent Business & Management Provided in Cooperation with: Taylor & Francis Group Suggested Citation: Hasibuan, Widya Sartika; Lubis, Irsad (2024) : Halal value chain integration in food court establishment through Cash Waqf Linked Sukuk: evidence from Indonesia, Cogent Business & Management, ISSN 2331-1975, Taylor & Francis, Abingdon, Vol. 11, Iss. 1, pp. 1-18, https://doi.org/10.1080/23311975.2024.2385075 This Version is available at: https://hdl.handle.net/10419/326465 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by/4.0/ Cogent Business & Management ISSN: 2331-1975 (Online) Journal homepage: www.tandfonline.com/journals/oabm20 Halal value chain integration in food court establishment through Cash Waqf Linked Sukuk: evidence from Indonesia Widya Sartika Hasibuan & Irsad Lubis To cite this article: Widya Sartika Hasibuan & Irsad Lubis (2024) Halal value chain integration in food court establishment through Cash Waqf Linked Sukuk: evidence from Indonesia, Cogent Business & Management, 11:1, 2385075, DOI: 10.1080/23311975.2024.2385075 To link to this article: https://doi.org/10.1080/23311975.2024.2385075 © 2024 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group View supplementary material Published online: 29 Jul 2024. Submit your article to this journal Article views: 1707 View related articles View Crossmark data Citing articles: 2 View citing articles Full Terms & Conditions of access and use can be found at https://www.tandfonline.com/action/journalInformation?journalCode=oabm20 EntrEprEnEurship and innovation | rEsEarch articlE Cogent Business & ManageMent 2024, VoL. 11, no. 1, 2385075 Halal value chain integration in food court establishment through Cash Waqf Linked Sukuk: evidence from Indonesia Widya sartika hasibuan and irsad lubis Faculty of economic and Business, universitas sumatera utara, Medan, indonesia ABSTRACT the monitoring of upstream and downstream halal standards is crucial for indonesia due to its large Muslim population and the increasing global demand for halal products. indonesia has the potential to become a leading center for the sharia economy and finance. thus, developing the halal food and islamic finance sectors is one strategy to unlock their potential, while strengthening the halal-value chain ecosystem further aids the expansion of the halal food industry. therefore, this study aims to develop the halal food sector and the islamic financial sector by integrating the halal value chain into the establishment of a food court financed through the cash Waqf linked sukuk (cWls) islamic financial instrument. this study used qualitative methods with primary and secondary data sources. the primary data came from observations and interviews with the indonesian Waqf Board (BWi). While the secondary data used in this study includes research findings regarding the halal value chain as well as the framework for the application of cWls funds. the result shows that accelerating the establishment of a halal food court ecosystem can be implemented through cWls funding. this framework offers financial assistance while maintaining the halal status of food court management. this study provides suggestions to the government on how to enhance the halal ecosystem for indonesia’s halal ecosystem improvement. Glossary: asma allah: the name of allah; Basmallah: a plea commonly recited by Muslims at the beginning of every task; halalan thayyiban: permissible for consumption and contains benefits for the body.; hayah Mustaqirah: Ensuring the circulation of blood and/or the movement of animals as indicators of animal life; ijab: proposal; Jhatka: the slaughter of animals performed according to the sikh law; Mauquf ‘alayh: the party appointed to obtain benefits from the allocation of waqf assets; nazir: individual or organization appointed to oversee and manage the waqf property; Qabul: acceptance; Qibla: the designated direction that every Muslim must face when doing their prayers.; ritual Kosher: regulations for the preparation, processing, and consumption of food within the Jewish tradition; shigat: statement of acceptance; ujrah: commission or fee charged for services provided; Waqf: islamic philanthropic practice where an individual or institution donates a specific asset; Wakif: the individual or entity that donate waqf; Zabiha: the rules of slaughtering an animal to make it halal for consumption 1. Introduction Waqf is an important islamic financial instrument that plays a dual role in economic progress and social activities. various efforts have been made to improve the productivity of waqf assets, including the utilization of cash waqf to be more productive and flexible. this encourages the improvement of people’s welfare by increasing economic growth (Mohd thas thaker et al., 2016). director General of Financing and risk Management of the Ministry of Finance, republic of indonesia, explained that the issuance of the cWls retail was an effort by the government to encourage the national Waqf Movement. the purpose of the cWls is to provide a forum that makes it easy for the money waqf giver (wakif), both © 2024 the author(s). Published by informa uK Limited, trading as taylor & Francis group CONTACT Widya sartika Hasibuan widyasartik[email protected] Faculty of economic and Business, universitas sumatera utara, Medan, indonesia. https://doi.org/10.1080/23311975.2024.2385075 this is an open access article distributed under the terms of the Creative Commons attribution License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. the terms on which this article has been published allow the posting of the accepted Manuscript in a repository by the author(s) or with their consent. ARTICLE HISTORY received 27 december 2023 revised 26 June 2024 accepted 21 July 2024 KEYWORDS cash Waqf linked sukuk; cash waqf; food court; halal value chain; ijarah; indonesia SUBJECTS Finance; social Entrepreneurship; innovation Management 2 W. s. hasiBuan and i. luBis temporary and permanent, to place the money waqf to be invested in state sukuk, the returns of which then become a source of financing for social activities that are safe, trustworthy, easy, productive, and intact inclusive and sustainable economy. the security of the large amounts of waqf money to be managed and guaranteed by the state is also the background of the cWls. according to a report from the royal islamic studies center (rissc) 2022, indonesia has one of the largest Muslim populations globally, with almost 87% of its residents identifying as Muslims. the presence of a significant demographic group is a great opportunity to encourage the national waqf movement and has a strong market demand for halal products and services, with the halal food industry playing a crucial role that is expected to continue to grow. current global market conditions, when based on the needs of Muslim communities worldwide, certainly lead to strong competition in the halal industry. Entrepreneurs are particularly interested in this industry because of its enormous development potential. this fact demonstrates that the halal business has attracted many countries, including indonesia, to compete to become the largest producer of halal products. indonesia’s culinary industry is experiencing significant growth due to the increasing consumption patterns and lifestyle shifts. Based on central Bureau of statistics (Bps) data the culinary sector contributes 41% of the country’s Gdp and has seen a 3.68% increase in business in June 2022, compared to 2.95% in 2021. the growth is driven by information and communication technology, allowing businesses to quickly expand. these developments highlight indonesia’s promising potential in advancing its halal industry and become a leading player in the global industrial sector and halal market. the halal industry, including halal value chains, has the potential to support the development of islamic economics in indonesia, and the government is taking steps to incorporate sustainable halal values in the country’s islamic economic master plan (Yazid et al., 2020). the halal value chain covers several industrial sectors from upstream to downstream and plays an important role in advancing indonesia’s economy in indonesia (hasan, 2021). in this case, the halal value chain is a concept for managing a business ecosystem that includes several aspects such as financing or funding, production processes, and regulations. integrating the halal value chain in indonesia is essential for various reasons. initially, it can enhance customer confidence in halal products, resulting in a change in consumer behavior (Zain et al., 2018). additionally, it can establish indonesia as a worldwide center for the halal industry, enabling in the advancement of islamic economics (hasan, 2021). additionally, it can tackle counterfeiting and uphold the quality of halal food and beverages (Mahsun et al., 2023). Finally, it can enhance local knowledge and worldwide market prospects, promoting the islamic economy (Yazid et al., 2020). Micro-, small-, and medium-sized enterprises (MsMEs) have significant potential for growth in the halal food sector, particularly in indonesia, which has the largest halal food product market globally. according to the state of the Global islamic Economy report 2022, the expenditure of Muslims on food rose by 6.9% in 2021, reaching $1.27 trillion by 2025. the halal food sector has moved from 4th to 2nd globally, with indonesia’s industry experiencing significant expansion due to halal food exports to other nations under the organization of islamic cooperation (oic). however, the industry currently accounts for only 3.8% of global economic activity (Figure 1). hence, the government persists in its efforts to achieve the top global position in the halal food industry. diverse initiatives have been undertaken, including the optimization of halal certification, to guarantee the halal status of products and fulfill the requirements of Muslims who consume halal products. in addition, the national committee for sharia Economics and Finance (Komite nasional Ekonomi dan Keuangan syariah, abbreviated KnEKs), together with other stakeholders, works to realize the halal, safe, and healthy culinary Zone area (Khas Zone), which is expected to become an area with the appropriate halalan thayyiban standard (KnEKs, 2019). the primary emphasis in this instance is on Micro, small, and Medium Enterprises (MsMEs) operating in the halal food industry. culinary enterprises, which are a subset of MsMEs, have demonstrated resilience and play a crucial role in supporting the national economy, particularly in the aftermath of the covid-19 outbreak. the islamic finance sector is an integral part of the development of the halal industry alongside the halal food and beverage sector. Based on state of the Global islamic Economy 2022 report, indonesia’s ranking in islamic economics and finance hold the 6th position globally, which still lags significantly behind the halal food industry. in this case, the government has made new innovations as an alternative to islamic coGEnt BusinEss & ManaGEMEnt 3 finance engaged in the waqf world, namely cash Waqf linked sukuk (cWls), which can help finance social programs, empower the people’s economy, and provide support for the islamic economy by strengthening the halal value chain ecosystem. research conducted by Mudriqoh (2023) utilizes the great potential of cWls as a source of financing for the recovery of the national economy during the covid-19 pandemic. the financing mechanism is through the issuance of state sukuk; returns are then used to finance various government programs that have an impact on the benefit of the people. Furthermore, oubdi and raghibi (2018) state that the more waqifs entrust their money to be represented in state sukuk, the more MsMEs are provided with business capital assistance. thus, to optimize the use of cWls returns, which aims to encourage the global development of the halal industry, the author explores the potential of cWls as a financing instrument engaged in the halal food sector, especially in the establishment of halal food courts. hence, this study aims to develop halal food and islamic financial sectors by integrating the halal value chain into the establishment of a food court financed through the cash Waqf linked sukuk. there are several studies related to this research, such as humaidi et al. (2023), Muhsin et al. (2023), siswantoro (2022), Maesarach et al. (2022) examined the cWls potential to become a new alternative source of funding for MsME sector. While, Mudriqoh (2023), sari (2023), rahman et al. (2021), and sulaeman et al. (2022) explored the potential of cash Waqf linked sukuk (cWls) as a financing tool for indonesia’s economic recovery post-covid-19. Furthermore, ubaidillah et al. (2021) provide a scheme for financing infrastructure based on cash Waqf linked sukuk. Finally, Fauziah et al. (2021) analyzed cash Waqf linked sukuk for social impact sustainable projects in indonesia and Yunita (2020) developed a comprehensive strategy that combines islamic social finance, government sukuk funding, and indonesia’s food security. of all the research that has been conducted, no research has been discovered that specifically addresses the creation of a halal food court with cWls returns. hence, this study aims to fill a gap in existing literature by examining the creation of a halal food court with cash waqf linked sukuk, contributing to islamic finance literature. Furthermore, this study proposes to further develop the concept of cWls in the halal culinary industry, which is a part of halal value chain sector. it provides an overview of the strategies that can be used to improve the halal ecosystem in indonesia. this study findings provide a financing model using cWls for halal food court establishment and the application of halal value chain in the food court. the study is divided into six sections. the first part consists of an introduction that discusses the background of the research problem; the second part discusses the literature review that explains about Figure 1. Halal food gie indicator ranking (Based on: state of the global islamic economy indicator (sgiei) Report 2022 produced by Dinarstandard with the support of Dubai economy and tourism). 4 W. s. hasiBuan and i. luBis halal value chain, food court, and cash waqf linked sukuk; the third part discusses related research methodologies used in this research; the fourth part explains the results and findings of the study; and the last part presents conclusions, limitations, and suggestions for further research. 2. Literature review 2.1. Waqf as Islamic financial instrument in Indonesia Waqf, a key islamic financial instrument, has historically played a crucial role in socio-economic development, particularly in providing social welfare services, including healthcare, education, and welfare (Baqutayan & Mahdzir, 2018; Zuki, 2012). it is also a significant tool in poverty alleviation and wealth redistribution, in conjunction with zakat (razak, 2020). Furthermore, waqf institutions have been instrumental in addressing social security challenges and promoting economic growth (aliyu, 2022). the Waqf institution can play a significant role in indonesia in various ways. there are numbers of literature emphasize the varied and significant impact that the Waqf institution can have in indonesia. Budiman (2011) emphasizes the potential of environmental conservation, whereas Fakhrunnas and Musta’in (2017) emphasizes its role in supporting the agriculture sector, specifically through the handling of waqf money by islamic banks. Gustina and ihsan (2020) highlights the significance of waqf in supporting higher education, especially amidst increasing education expenses. lastly, hakim and sarif (2021) discusses the role of productive waqf in community economic empowerment, citing the successful management of a gas station business unit by the Muhammadiyah regional Board of lumajang, East Java. Waqf assets must be managed to generate income, which in turn is used to finance public services. When waqf is fulfilled, there is a shift from private property ownership to social ownership. various studies have examined the notion of waqf, which refers to endowments, as a method for advancing social welfare and development. shaikh et al. (2017) and Medaline et al. (2020) highlight the capacity of waqf to address the void created by inadequate governance and limited financial institutions while also promoting a balance between private and societal interests. Waqf has great potential as an islamic financial instrument. this can be seen in the analysis report on the performance of waqf management in 2022. the national Waqf index (nWi) in 2022 revealed a growth of 0.274% in waqf, surpassing the growth rate in 2021 by 0.135%. this indicates that the potential of waqf has not been fully utilized and efficiently managed. the conventional interpretation of waqf, which restricts it to immovable assets, has impeded its capacity for societal and economic progress (ardiyansyah & Kasdi, 2021; hariyanto, 2022). the discourse surrounding the waqf of movable objects has emerged primarily within specialized circles in recent years without reaching the general public. the waqf of movable objects encompasses assets that are not depleted by consumption such as currency, precious metals, securities, vehicles, intellectual property rights, and lease rights. currently, cash waqf is a widely discussed subject. cash waqf as a productive waqf instrument was relatively new in indonesia after the indonesian ulema council (Majelis ulama indonesia, abbreviated Mui) issued a fatwa on the permissibility of cash waqf in 2002. the presence of law no. 41/2004 on Waqf in article 16 emphasizes that waqf is not only in the form of immovable objects, but also in movable objects. the indonesian Waqf Board (Badan Wakaf indonesia, abbreviated BWi) noted that the acquisition of cash waqf in March 2022 reached 1.4 trillion rupiah and has the potential to reach 180 trillion rupiah per year. there is enormous potential for cash waqfs in indonesia. hence, cash waqf has emerged as a source of optimism for several stakeholders, serving not only religious purposes but also as a means to enhance the economic well-being of the community. 2.2. Overview halal value chain for food court establishment in Indonesia the halal value chain is an intricate system that involves multiple stages, starting with the acquisition of raw materials for consumption. this system requires cooperation and ongoing enhancements (perdana, 2020). this system is of significant importance in the food industry because of variables such as the use of halal animal feed, adherence to proper slaughtering practices, and the implementation of segregation coGEnt BusinEss & ManaGEMEnt 5 techniques (omar, & Jaafar, 2011). the concept of halal logistics and supply chains is crucial for maintaining the authenticity of halal products across an entire supply chain (Jaafar et al., 2016). presently, the halal industry is experiencing rapid growth and advancement across several industries, including food and beverages, finance, fashion, cosmetics, medicine, tourism, entertainment, healthcare, travel, and education. the halal value chain is a crucial strategy for the indonesian halal industry, particularly in the food and beverage sector, because it enables producers to compete globally (charina, & charisma, 2023). public awareness of the importance of consuming halal products plays a significant role in driving the development of halal value chains (Fitri et al., 2022). this is further supported by the increasing global demand for halal products, which has transformed the halal industry into an emerging market. the implementation of halal food management in indonesia, as mandated by law, is also a key factor in the success of halal value chains (hasan, 2021). the endeavor to establish indonesia as the focal point of the islamic economy by bolstering the halal value chain is substantiated by a variety of research studies. Yazid et al. (2020) highlighted the capacity of halal industries, including food, tourism, fashion, and medicine, to propel islamic economic growth. amalia and hidayah (2020) highlighted significant obstacles, such as regulatory issues, workforce limitations, and lack of public knowledge, and proposed approaches such as enhancing rules and cultivating a halal way of life. hasan (2021) emphasizes the significance of effectively managing the halal supply chain to establish indonesia as a global hub for the halal business. Widuhung and Machmud (2022) emphasizes the significance of indonesian islamic banking in effectively controlling the worldwide halal value chain, underscoring the requirement for regulatory and policy assistance. these studies emphasize the potential of the halal value chain in establishing indonesia as a prominent global islamic economic center. the Food court is also known as the Pujasera (Multipurpose snack center) is a place to eat where numerous food vendors or restaurants gather to provide a diverse range of prepared food choices. a food court is a specifically defined space within a shopping mall, airport, or other commercial or institutional location that offers customers a convenient and varied selection of food options in a centralized place. Generally, individual vendors or restaurants in a food court have their own dedicated counters or kiosks where customers can select from a variety of culinary alternatives offered by different cuisines. Food courts typically have a communal dining space in which consumers can save their meals. this communal dining space is furnished with tables and seats, facilitating the gathering of individuals to partake in meals in a convivial environment. a food court offers a diverse range of culinary choices such as fast food, ethnic dishes, snacks, desserts, and other possibilities. indonesia’s food and beverage industry has experienced remarkable growth. Food quality, convenience, and variety are key factors that drive customer satisfaction in food courts (Mahin, & adeinat, 2020). however, the rent for food court spaces tends to be higher in urban areas, which can affect the pricing and services offered (shaer, 2019). 2.3. Cash Waqf Linked Sukuk Waqf today, based on the type of good, is not only in the form of cash waqf (cash waqf) or non-cash waqf. Waqf comes from the word ‘Waqafa’, which means ‘to hold’ or ‘to stop’ to stop. abu hanifah argued that waqf is the release of property from the owner to the recipient in accordance with the provisions of sharia by saying the waqf word for a certain period in accordance with the wishes of the owner and may not withdraw the waqf. regarding the act of the waqif, the benefits of the property can be used by the recipient of waqf (Mohd thas thaker et al., 2016). a cash waqf is the gift of a sum of money dedicated to its perpetual use in accordance with the objectives agreed upon by the donor. cash waqf became known in the 8th century after imam Zufat approved its use. Based on this view, cash waqf can be invested through a mudharabah contract, and the profits generated can be used for charitable purposes (Mohd thas thaker et al., 2016). innovation in cash waqf management instruments consists of four patterns: giving roles to islamic banking, establishing fund investment institutions, establishing business partnerships, and giving roles to islamic guarantee institutions (indra & hakim, 2020). however, the utilization of cash waqf can take the form of a sukuk. sukuk is a certificate of ownership for each sukuk that shows an inseparable proportional interest in an 6 W. s. hasiBuan and i. luBis asset. the characteristic of sukuk is that the owner of sukuk has the right to the income generated from sukuk assets, and sukuk cannot be traded in the secondary market. sukuk has an advantage in that it is related to the value of the underlying assets (syafrida et al., 2017). the introduction of cash Waqf linked sukuk (cWls) by the indonesian government has been seen as a significant innovation in the field of islamic finance, particularly in the context of economic recovery and infrastructure development (sari, 2023). this platform was the first integration of cash waqf and Government islamic securities (surat Berharga syariah negara, abbreviated sBsn) in indonesia (indra & hakim, 2020). the purpose of the cWls is to provide a facility for cash waqf givers (wakif), both contemporary and permanent, to utilize their cash waqf as safe, productive, and impactful investment instruments (rahman et al., 2021). the income from cWls goes to nazir (the manager of waqf funds and operations) to finance social programs and empower the people’s economy. as cWls is an islamic financial instrument, its funds are only allowed to be invested in halal projects. By implementing this cWls, the private sector can engage in proactive involvement in the enhancement of profit-generating public institutions within the country. simultaneously, the government can provide establishments and facilities where individuals and institutions can securely and efficiently store funds, thereby directly contributing to the empowerment of public finances. cash waqf has enormous potential to be developed in indonesia (putri, 2021). according to BWi 2023 reports, BWi has allocated cWls returns towards the development of assets at the ahmad Wardi Eye hospital, farmer empowerment programs, providing scholarships to college students, and other social activities. these projects financed by cWls implement various cash waqf management models. Multiple studies have explored the potential of using cash Waqf linked sukuk as an instrument of financing. however, there has been an absence of discussion regarding the optimization of islamic finance cash waqf linked sukuk in food courts through the implementation of a halal value chain ecosystem covering various activities. rahman etal. (2021) examined the viability of cash Waqf linked sukuk (cWls) as a financial tool for the economic recovery from the covid-19 crisis in indonesia. this instrument is suitable due to its high flexibility and appeal to the Muslim philanthropic middle class. additionally, the cWls instrument meets the necessary requirements for financing the recovery of the covid-19 epidemic, which involves short and medium term of financing. under the cWls model, each research project has a distinct focus. Mudriqoh (2023) utilizes a blend of the commercial finance sector and the real sector to create cWls designs. the procedure involves four primary stages: collecting, placement, distribution, and utilization of returns, along with refunds. thaker et al. (2016) established the icWME-i model to utilize cash waqf funds or cWls as a means of funding for micro enterprises in the provision of financial services. therefore, this study also employs the cash waqf linked sukuk model, which involves an ijarah contract that legally ties the food court manager and the business actor. 3. Research methods 3.1. Research design this study uses a qualitative research design, gathering descriptive data through interviews, observations, and document analysis to understand the application of the halal value chain in food courts and the implementation of cWls. the research activities include conducting preliminary studies, collecting literature, formulating research focuses, collecting data through observation, interviews, and documentation analysis. the data is then refined, checked for correctness, classified, analyzed, and conclusions drawn from the research results. 3.2. Data collection method this study used both primary and secondary data sources. the utilization of both primary and secondary data sources is a prevalent and efficacious methodology in research, as emphasized by Windle (2010). the primary data consisted of observations of the research process with the objective of obtaining thorough results. in addition, interviews were conducted with pertinent personnel participating in the program, which in this case is the indonesian Waqf Board (BWi), to acquire a comprehensive and reliable coGEnt BusinEss & ManaGEMEnt 7 understanding of program implementation. We aim to get information and perspectives from BWi, as they are the manager of cWls in indonesia and therefore the best source of information for our interview. hence, the interviewee selected for this study are two experts who have a comprehensive understanding of the implementation of cWls and have actively participated in its operations, who are staffs from the development and Management (pnpW) division and responsible for managing this cWls program. they served as the strategic partnership manager and the operational and financial manager of BWi. Furthermore, secondary data were obtained from reviewing relevant literature, such as articles and journals, seminar and conference papers, books, and official websites. the subjects of this research were data and information sources, comprising both individuals and written data, specifically from BWi and previous studies. this research has been granted approval by the social and humanities research ethics commission under approval number 02/05/Ec/2023. 3.3. Participant this research conducted interviews involving human participants as a source of information. verbal consent was obtained from the participants, indicating their willingness to be interviewed. the findings from these interviews were used for the purposes of this study. Before conducting research, we mailed a formal correspondence to BWi, requesting their participation in an interview. subsequently, upon receiving the subject matter and the list of inquiries to be posed during the interview, BWi granted authorization for the interview. interviews were carried out with individuals at BWi who hold positions and capacities to manage cWls fund. Following the interview, the researcher informed the participants that the findings of this study would be published in scientific journals, and the participants agreed to this verbally. 4. Results and discussion 4.1. Integration of halal value chain in food court establishments the culinary industry, which is currently highly popular and has significant prospects, is the Food court (one-stop Food center). the public’s affinity for this food court stems from its diverse array of culinary options, ranging from genuine local delicacies to international fares, catering to consumers with all budgetary preferences within a single location (sunaryo, 2019). a strategic location is also a driving factor in attracting customers around the location so that it can help the food court’s business grow. When considering the state of the indonesian population, who are mostly Muslims, there is a significant emphasis on ensuring that all aspects of halal requirements are met from the production process to the final delivery. Food courts are a matter of public concern. there are still many culinary delicacies that ensure adherence to halal dietary restrictions. halal certificates and logos serve as indicators of the level of knowledge and understanding regarding compliance of food and beverages with halal standards. in order to obtain a halal certificate, producers must secure authorization from the indonesian council of ulama (Mui) and halal product Guarantee agency (Badan penyelenggara Jaminan produk halal, abbreviated BpJph). subsequently, producers are granted authorization to incorporate halal labels into all their product packaging. the implementation of the halal value chain system is the implication of halal values in production activities and distribution to consumption activities in the form of goods or services, as stated in Government regulation (pp) number 31 of 2019 concerning implementation regulations. law number 33 of 2014 concerning halal product guarantees states that the government guarantees halal products from the production, distribution, sales, and presentation of products that are in accordance with the concept of halal value chain (Government regulation number 31 of 2019). in indonesia, halal products in the food industry include meat, poultry, sweets, canned and frozen foods, milk, bread, organic foods, herbal products, and beverages. halal refers to permissible or lawful products or activities in islamic law, particularly in food and drink. this includes activities like processing, converting, preparing, preserving, and packaging foodstuffs in line with islamic dietary rules, including small traditional manufacturing, labor-intensive family businesses, and large processed industries. subsequently, 14 W. s. hasiBuan and i. luBis emphasizes the need for policy adjustments and special financing for halal industries, while siswoyo (2021) underscores the importance of halal certification and brand image in the halal industry ecosystem. Khan etal. (2019a, 2019b, 2020, 2022) offers an in-depth analysis of the risk factors involved in incorporating the halal value chain into the food business. these studies analyzed and evaluated many risk factors, such as supply related risks, production risks, planning risks, logistic and outsourcing risks, and information technology-related risks. additionally, they consider halal-related risks, such as the status of raw materials, processing methods, and quality of raw materials. the results emphasize the importance of considering the entire process and distribution of halal goods, incorporating both internal operations and outsourced components, and establishing a risk-assessment methodology to successfully manage these risks. hence, the risk aspects in the integration of the halal value chain into the provision of food courts include the following: 1. risk of compliance with halal standards: this risk is related to non-compliance with halal standards in the provision of food and beverages in food courts. this can occur if there is no clear and standardized sop, a lack of halal training and certification for employees, or supervision and audits that are not regularly carried out. 2. product quality risk: this risk is related to the quality of the products produced by the food court. this can occur if the raw materials used are not halal or of high quality, or if the production process is not performed properly. 3. Food safety risk: this risk is related to the safety of the food produced by the food court. this can happen if there is no clear and standardized sop in food and beverage processing or if there is no regular supervision or audit. 4. risk of compliance with applicable laws and regulations: this risk is related to non-compliance with applicable regulations and laws in the provision of food and beverages in food courts. this can occur if there are no clear and standardized sops, regular supervision, or audits. 5. reputation risk: this risk relates to the reputation of the food court, which may suffer in the event of non-compliance with halal standards, product quality, food safety, or applicable regulations and laws. this may result in a decrease in the number of customers and in revenue. to manage the risk of integrating a halal value chain into the provision of food courts, it is necessary to identify, assess, and control appropriate risks. some ways to control risks include implementing clear and standardized sops, conducting halal training and certification for employees, conducting regular supervision and audits, using halal and high-quality raw materials, collaborating with trusted suppliers, having halal certification, and using the appropriate technology and information systems to monitor and control risks. 5. Conclusion and implication this study proposed a financial framework that uses cash Waqf linked sukuk (cWls) for the establishment of a food court integrated with halal value chain (hvc). additionally, we examine the implementation of hvc within the food court. the returns from cWls can be used as capital for the construction of a food court by Figure 4. ijarah agreement between food court manager and business actors (tenants). coGEnt BusinEss & ManaGEMEnt 15 involving several parties, namely, the wakif who invests in cWls, BWi as the manager of cWls, the Ministry of Finance as the issuer of sBsn, nazir partner as the manager of the food court, and islamic bank as ready fund providers. during the establishment of this food court, the nazir partner collaborates with business actors or tenants through the use of an ijarah contract. the implementation of hvc within the food court is to ensure the integrity of halal products from production to consumption. this includes careful separation of halal and non-halal items throughout the process, hence it involves BpoM and BpJph to supervise and provide halal certificate. the establishment of a halal food court also supported the MsMEs and contributed to the development of economic sector. Finally, to manage the risks associated with integrating the halal value chain into food court operations, it is necessary to conduct appropriate risk identification, assessment, and control. this research provides several implications. this study constructs a financing framework in the field of islamic finance literature, specifically focusing on the application of cWls to enhance the halal value chain in culinary industry. therefore, this study provides suggestions to the government on how to enhance the halal ecosystem, hence improving indonesia’s position in the world. additionally, this research offers valuable insights to regulators, the government, and the indonesian Waqf Board (BWi) regarding potential strategies for enhancing the growth of productive waqf funds. the ultimate goal is to strengthen the role of waqf funds as a means to drive economic growth. Furthermore, in an effort to enhance the halal ecosystem in indonesia, the financing system in indonesia can use cWls-based funding specifically for sectors that prioritize the development of the halal ecosystem. this financing will ensure the preservation of the halal status, a requirement that must be met by all Muslims worldwide. this study has several limitations that should be considered and can be improved in future research. initially, this research explains in general the implementation of the halal value chain in the food court. Future investigations should prioritize emphasizing the implementation of the halal value chain throughout every stage of activities inside the halal food court. Furthermore, this study conducted interviews only with BWi officers who have a comprehensive understanding of cash waqf related sukuk. For future study, it is recommended that researches should aim to include informants from diverse backgrounds, such as consumers, academics, nazir partner, and others, based on the specific research objectives. Furthermore, this study focuses on the establishment of a halal food court with cash Waqf linked sukuk. hence, it is recommended that future research should aim to enhance the existing designs. Acknowledgments We express our gratitude to the indonesian Wakaf Board (BWi) for participating in the interviews. Author contributions Widya sartika hasibuan contributed an instrumental part in designing and carrying out the research, while irsad lubis analyzed the results and wrote the manuscript. Data availability the data that supports the findings of this study are available in this article. Disclosure statement the authors have no conflict of interest to declare. About the authors Widya Sartika Hasibuan holds a Master’s degree in islamic Economics from universiti Kebangsaan Malaysia. she is currently a lecturer at the Faculty of Economics and Business, universitas sumatera utara, specifically in the Economic development department. her research interests and areas of expertise include Economic and Finance, with a particular focus on islamic Economic and Finance. 16 W. s. hasiBuan and i. luBis Irsad Lubis earned his doctoral degree in Economics development from universiti sains Malaysia, graduating in 2004. he is a lecturer in the Economic development department at the Faculty of Economics and Business, universitas sumatera utara. his research interests and areas of expertise include development Economics, development planning, and islamic Economics. Funding the authors would like to thank universitas sumatera utara for research funding assistance, which was granted through the applied research scheme outlined in universitas sumatera utara chancellor’s decree number 2837/ un5.1. r/sK/ppM/2023. ORCID irsad lubis http://orcid.org/0009-0002-9788-7439 References alamsyah, a., hakim, n., & hendayani, r. (2022). Blockchain-based traceability system to support the indonesian halal supply chain ecosystem. Economies. MDPI, 10(6), 134. https://doi.org/10.3390/economies10060134 aliyu, s. (2022). reflections on the socioecomic role of waqf in an islamic economic system. IJUS | International Journal of Umranic Studies, 2(1), 31–43. https://doi.org/10.59202/ijus.v2i1.560 amalia, E., & hidayah, n. (2020). strategies for strengthening halal industries towards integrated islamic economic system in indonesia: analytical network process approach. Al-Iqtishad: Jurnal Ilmu Ekonomi Syariah, 12(1), 77–102. ardiyansyah, r., & Kasdi, a. 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