» AL-IMAM: Journal on Islamic Studies, Civilization and Learning Societies
Aims: This study aims to analyze the optimization of waqf investment at Badan Wakaf Uang Muhammadiyah (BWUM) West Sumatra by focusing on waqf asset diversification, investment management, risk control, and the utilization of investment returns for community welfare. Method: This research employs a qualitative approach using an ex-post facto method. Data were collected through interviews and documentation related to waqf investment management at BWUM West Sumatra. The data were analyzed descriptively to examine the practices of investment development, supervision, reporting, risk management, and distribution of waqf benefits. Results: The findings indicate that BWUM West Sumatra has developed waqf funds through Islamic financial institutions and productive business activities, including UD Berkah. However, several investments have been discontinued due to considerations of efficiency and sustainability. Waqf investment management is supported by supervision, financial reporting, reserve fund establishment, and the distribution of investment benefits to social, educational, and healthcare sectors. These findings demonstrate that waqf investment optimization requires a balance between asset development, risk control, professional nazhir management, transparency, and the orientation toward public welfare. Conclusion/Novelty/Implications: The novelty of this study lies in its integrated analysis of waqf investment optimization by linking asset diversification, investment management, risk control, and the utilization of investment returns within the context of BWUM West Sumatra. The findings imply that strengthening nazhir professionalism, investment governance, transparency, and risk management is essential to ensure the sustainability and productivity of waqf assets. Future efforts should emphasize broader asset diversification, more strategic investment planning, and the development of productive waqf models that generate sustainable socio-economic benefits for the community.