SOVEREIGN WEALTH FUND
This slide was prepared by:
Karina Wulandari,Lisa Listiana, Ronald Rulindo, Yaser Taufik Syamlan
Confidential & Proprietary | 2025
AGENDA
01
The Global Sovereign Fund Phenomenon
02
Definition, Types & Structure
03
Business Model Canvas
04
Shariah Akad & Islamic Perspective
05
Risk Mitigation Framework
06
Danantara: Indonesia's SWF
07
Sovereign Wealth Sukuk
08
LPDU – The World's First Sovereign Social Fund
09
Orbitum: Tokenizing Indonesia's Sovereign Sukuk
10
Conclusion & Recommendations
2
THE GLOBAL SOVEREIGN FUND PHENOMENON
$13T+
Global AUM
Sovereign Wealth Funds worldwide
106+
Active SWFs
Across 58 countries globally
1953
Year Founded
Kuwait Investment Authority – world's first SWF
$1.6T
Norway GPFG
World's largest single SWF
Key Milestones in SWF History
1953
Kuwait Investment Authority founded – world's first SWF
1976
Abu Dhabi Investment Authority established (now largest in Middle East)
1990
Norway Government Pension Fund Global created from oil revenues
2000s
China, Singapore, Gulf states rapidly expand SWF assets
2015
Indonesia establishes PT Sarana Multi Infrastruktur as precursor fund
2025
Danantara launched – Indonesia's integrated sovereign investment platform
3
DEFINITION OF SOVEREIGN FUND
"A Sovereign Wealth Fund (SWF) is a state-owned investment fund or entity composed of financial assets such as stocks, bonds, real estate, or other financial instruments. SWFs are created for various macroeconomic purposes and invest globally to achieve financial returns."
— International Working Group of Sovereign Wealth Funds (IWG/IFSWF)
Core Characteristics of a Sovereign Fund
State Owned
Wholly or majority owned by a national or sub-national government
Long-term Horizon
Invests with multi-decade or generational time horizons
Non-pension Capital
Distinct from pension funds; serves broader national economic goals
Macro Objectives
Stabilization, savings, development, reserve investment, strategic
Foreign Assets
Typically invests substantially in foreign financial assets
No External Liabilities
Unlike banks or insurers, does not leverage depositor/policyholder funds
4
TYPES OF SOVEREIGN FUNDS
1
Stabilization Fund
Objective:
Smooth government revenues; buffer commodity price volatility
Example: Russia's National Wealth Fund, Chile's ESSS
2
Savings Fund
Objective:
Transfer resource wealth to future generations
Example: Norway GPFG, Kuwait FGF
3
Reserve Investment Fund
Objective:
Enhance returns on excess foreign exchange reserves
Example: GIC Singapore, SAFE China
4
Development Fund
Objective:
Finance socio-economic development & infrastructure
Example: Mubadala (UAE), Temasek (Singapore)
5
Pension Reserve Fund
Objective:
Pre-fund future pension liabilities without direct pension mandate
Example: New Zealand Super, Australia Future Fund
6
Sovereign Social Fund
Objective:
Manage public/religious donations for broad social benefit
Example: LPDU Indonesia (first in the world)
5
SOVEREIGN FUND STRUCTURE
Government / Sovereign
Legal Mandate & Charter
Board of Directors / Oversight
Investment Management Office
Risk & Compliance
Operations & Finance
Portfolio Asset Classes
Equities
(Public & Private)
Fixed Income
& Sukuk
Real Estate
& Infrastructure
Alternatives
(PE, VC, Hedge)
Commodities
& Resources
Cash &
Equivalents
6
BUSINESS MODEL CANVAS – SOVEREIGN FUND
Key Partners
• Gov't Ministries
• Central Banks
• Intl. Development Banks
• Asset Managers
• Portfolio Companies
Key Activities
• Asset Allocation
• Portfolio Management
• Risk Assessment
• Policy Compliance
• ESG Integration
Key Resources
• State Capital
• Human Capital
• Data & Analytics
• Regulatory Authority
• Global Networks
Value Propositions
• Long-term Wealth Preservation
• National Dev. Financing
• Macro Stabilization
• Generational Transfer
• Strategic Investments
Customer Relationships
• Policy Transparency
• Annual Reporting
• Public Accountability
• Santiago Principles
Channels
• Direct Investment
• Fund-of-Funds
• Joint Ventures
• Sukuk Issuance
Customer Segments
• Citizens & Society
• Future Generations
• Strategic Industries
• International Partners
Cost Structure: Management, Compliance, Operations, Technology
Revenue: Capital Gains, Dividends, Rental, Sukuk Returns, PPP Fees
7
SHARIAH CONTRACT FRAMEWORK FOR SOVEREIGN FUND
Mudharabah
مضاربة
Profit-sharing partnership: government as Shahibul Maal (capital provider), fund manager as Mudharib (entrepreneur). Profit split per agreed ratio; loss borne by capital provider.
Use: Equity investments, venture capital, growth funds
Musyarakah
مشاركة
Joint venture with shared capital, profit, and proportional loss. Both parties contribute capital and participate in management decisions.
Use: Infrastructure PPP, project finance, co-investments
Ijarah
إجارة
Lease-based contract where the fund owns real assets and leases them to operators. Rental income is permissible as consideration for usufruct.
Use: Real estate, aircraft, equipment leasing
Wakalah
وكالة
Agency contract where the fund acts as Wakil (agent) on behalf of the sovereign, managing investments for a fixed fee rather than profit share.
Use: Fund management, custody, treasury operations
Istisna'
إستصناع
Manufacturing/construction contract for future delivery. Allows financing of infrastructure before completion by pre-agreeing specifications and price.
Use: Infrastructure, construction, development projects
Wakaf/Waqf
وقف
Perpetual endowment of assets for public benefit. Unique to Islamic finance; enables sovereign social fund model where corpus is preserved in perpetuity.
Use: LPDU, Sovereign Social Fund, social impact investing
8
Risk Mitigation Framework
A multi-layer risk architecture protects sovereign wealth across market cycles and geopolitical shifts
Market Risk
HIGH
• Diversification across asset classes & geographies
• Strategic Asset Allocation (SAA) with rebalancing
• Currency hedging via derivatives (FX forwards, options)
• Factor-based risk parity strategies
Political / Governance Risk
HIGH
• Independent board insulated from government interference
• Santiago Principles compliance & IFSWF membership
• Parliamentary oversight & external audit
• Clear investment policy statement (IPS)
Liquidity Risk
MEDIUM
• Maintain liquidity tranche (10-15% in liquid assets)
• Laddered maturity structure for fixed income
• Stress testing: redemption + crisis scenarios
• Credit facility with central bank as backstop
Concentration Risk
MEDIUM
• Sector caps (no single sector >20% of portfolio)
• Geographic diversification mandates
• Counterparty limits on managers & custodians
• Multi-manager structure for alternatives
Shariah Non-Compliance Risk
MEDIUM
• Independent Shariah Supervisory Board (SSB)
• Pre-investment Shariah screening (AAOIFI/IFSB standards)
• Continuous monitoring of portfolio Shariah status
• Purification mechanism for incidental haram income
Cyber & Operational Risk
LOW-MED
• ISO 27001 certified information security framework
• Business continuity & disaster recovery planning
• Third-party vendor risk assessments
• For tokenized assets: smart contract audits, multi-sig custody
ISLAMIC PERSPECTIVE ON SOVEREIGN FUND
"And do not give the weak-minded your property which Allah has made a means of sustenance for you, but provide for them with it and clothe them and speak to them words of appropriate kindness."
— Quran 4:5 (Al-Nisa) | Principle of Stewardship (Khilafah) of Public Wealth
Khilafah (Stewardship)
The state is a trustee (khalifah) of public wealth, obligated to manage it responsibly for present and future generations. SWFs embody this principle by investing surplus for intergenerational welfare.
Maslahah (Public Interest)
All sovereign fund activities must serve the broader maslahah (public good). Investment decisions weigh social, environmental, and economic benefit beyond financial returns alone.
Prohibition of Riba
Islamic SWFs strictly avoid interest-bearing instruments. Instead, they utilize equity participations, sukuk, leasing, and profit-sharing structures compliant with shariah.
Zakat & Infaq Integration
Islamic SWFs may incorporate zakat, infaq, and sadaqah into their capital base (as with LPDU), creating a hybrid fund that combines commercial returns with social obligation.
Maqasid Al-Shariah
Investments must protect the five maqasid: Deen (faith), Nafs (life), Aql (intellect), Nasl (lineage), Mal (wealth). ESG + Shariah screening aligns these objectives with modern impact investing.
Hifz Al-Mal (Wealth Protection)
The shariah obligation to protect and grow wealth aligns with SWF's long-term preservation mandate, prohibiting speculative (maysir) or harmful (dharar) investments.
9
Islamic Perspective on Sovereign Funds
Maqashid Syariah provides a divine framework transforming sovereign wealth into a tool for civilizational well-being
"Wealth belongs to Allah and humans are merely trustees (khalifah) — Sovereign funds managed on Islamic principles become instruments of amanah (trust), adl (justice), and maslahah (public benefit)"
Hifzh al-Nafs�(Preservation of Life)
• Fund healthcare, food security, social protection programs
• LPDU: fund welfare for marginalized ummah
• Prohibition of investments in harmful industries
Hifzh al-'Aql�(Preservation of Intellect)
• Education endowments, research institutions
• Waqf-based universities & Islamic scholarships
• Digital literacy & fintech investment
Hifzh al-Nasl�(Preservation of Progeny)
• Intergenerational wealth transfer principles
• Family waqf instruments
• Social housing for young families
Hifzh al-Mal�(Preservation of Wealth)
• Core mandate: protecting & growing national wealth
• Halal investment screening
• Prohibition of riba, gharar, maysir
Hifzh al-Din�(Preservation of Faith)
• Fund maintenance of religious institutions
• LPDU: Islamic endowment for Ummat
• Transparent, accountable governance (amanah)
DANANTARA: INDONESIA'S SOVEREIGN INVESTMENT PLATFORM
Full Name
Badan Pengelola Investasi Daya Anagata Nusantara (Danantara)
Established
2025 under President Prabowo Subianto
Initial AUM
~USD 900 Billion (assets under management target)
Structure
State-owned investment holding under Republic of Indonesia
Key Assets
Controls 7 major SOEs: PLN, Pertamina, BUMN Banking Group, Telkom, etc.
Mandate
Accelerate national development, attract FDI, maximize SOE returns
CEO
Rosan Roeslani (appointed 2025)
STRATEGIC PILLARS
Energy Transition
Digital Economy
Food Security
Healthcare
Infrastructure
Green Industry
Islamic Finance
Islamic Finance Note: Danantara is developing shariah-compliant investment windows and sovereign sukuk issuance pathways, particularly for infrastructure financing, in collaboration with the Ministry of Finance and OJK.
11
Danantara – Indonesia's Sovereign Wealth Fund
Established February 2025 under Presidential Regulation — Indonesia's bold leap into sovereign fund leadership
$900B
Target AUM (2030)
$20B
Initial Capital (2025)
99+
SOEs Under Management
Jakarta
Headquartered
Legal Basis & Mandate
• Presidential Regulation No. 9/2025 & Law No. 1/2025
• Consolidates 99+ State-Owned Enterprise (SOE) assets
• Development mandate: food security, energy, digital economy
• Supervised by President of Indonesia directly
• CEO: Rosan Roeslani (former Investment Minister)
Investment Focus Areas
• Hilirisasi (downstream) of natural resources (nickel, copper, bauxite)
• National food sovereignty & agriculture modernization
• Renewable energy transition (geothermal, solar, green hydrogen)
• Digital infrastructure & AI development
• Healthcare & pharmaceutical national self-sufficiency
Key Subsidiary Holdings
• PT Pertamina (energy)
• PT PLN (power)
• Bank Mandiri, BRI, BNI (banking)
• PT Telkom Indonesia (digital)
• PT Freeport Indonesia (mining)
• Indonesia Battery Corporation (IBC)
Danantara & Islamic Finance
• Mandate to manage Syariah-compliant investment tranche
• Potential co-management of sovereign sukuk proceeds
• Green sukuk for renewable energy investments
• Partnership pathway with LPDU for social impact blending
• IFSB & AAOIFI governance framework adoption in pipeline
SOVEREIGN WEALTH SUKUK
Sovereign Sukuk are shariah-compliant bonds issued by governments, backed by real state assets, infrastructure or services. Indonesia has been a pioneer, with cumulative issuance exceeding USD 200 billion since 2008, making it the world's largest sovereign sukuk issuer.
Indonesia's Key Sukuk Instruments
SBSN (State Sharia Securities)
Government investment sukuk
Issued by MoF; backed by state assets (right of use). Various tenors from 1–30 years.
SR (Sukuk Ritel)
Retail-focused sukuk
Democratized access to sovereign sukuk for retail investors via digital channels; min IDR 1 million.
PBS (Project-Based Sukuk)
Infrastructure project sukuk
Directly funds national strategic projects: roads, airports, ports, railways.
SDHI (Social Impact Sukuk)
Social sector sukuk
Finances education, health, housing. Supports LPDU mandate for social sovereign fund.
USD 200B+
Cumulative Issuance
World #1
Largest Sovereign Sukuk Issuer
2008
Year of First Issuance
30+ Years
Maximum Tenor Available
12
LPDU: WORLD'S FIRST SOVEREIGN SOCIAL FUND
Lembaga Pengelola Dana Ummat (LPDU) is an initiative by Indonesia's Ministry of Religious Affairs to create the world's first Sovereign Social Fund — managing religious endowments (waqf), zakat, infaq, and sadaqah at a national scale through a shariah-compliant, transparent, and professionally-managed sovereign structure.
Ministry of Religious Affairs
Initiated by Kemenag RI; integrated into national religious financial architecture
Capital Sources
Waqf assets (land, buildings, productive waqf), Zakat, Infaq, Sadaqah, Hibah
Legal Structure
Sovereign-backed legal entity with independent board; NOT a private institution
Investment Model
Productive waqf & halal economy investments; returns used for social programs
Beneficiaries
Mustahiq (zakat recipients), waqf beneficiaries, pesantren, Islamic education, healthcare
Global Significance
First government-backed sovereign fund derived entirely from religious/social capital
LPDU
ECOSYSTEM
Waqf Land Mgmt
Zakat Collection
Halal Economy
Islamic Fintech
Pesantren Fund
Social Sukuk
SDHI Integration
Digital Waqf
★ LPDU: A Global First — Sovereign Social Fund combining religious capital with state governance for universal social impact ★
13
LPDU – Lembaga Pengelola Dana Ummat
World's First Sovereign Social Fund — Transforming Indonesia's Religious Funds into Productive Islamic Wealth
LPDU is the Kementerian Agama (Ministry of Religion) initiative to create a unified Islamic sovereign social fund managing Waqf, Zakat, Infaq, Shadaqah, Haji, and Umrah funds under a single productively-invested vehicle — a world first in sovereign Islamic social finance.
Why LPDU is Historic
• First-ever government-managed sovereign social fund globally
• Aggregates fragmented Islamic social finance into one vehicle
• Indonesian Muslim population: 237M (world's largest)
• Zakat potential: IDR 327 trillion/year (~$20B) — only 4% collected
• Waqf asset potential: IDR 2,000 trillion+ (~$130B)
• Haji & BPIH funds: IDR 160 trillion (~$10B) managed by BPKH
• LPDU unifies these into a single sovereign investment mandate
Funding Architecture
• Zakat (obligatory alms) → distributed to 8 asnaf beneficiaries
• Waqf (endowment) → perpetual capital, returns for public benefit
• Infaq/Shadaqah → flexible charitable contributions
• Dana Haji (Hajj funds via BPKH) → conservative Shariah investments
• Proceeds reinvested into: healthcare, education, affordable housing
Governance & Shariah Framework
• Under Kementerian Agama (Ministry of Religious Affairs) mandate
• Independent Shariah Supervisory Board (DSN-MUI certified)
• Wakalah-based professional investment management
• AAOIFI standards for financial reporting & compliance
• Integrated with SINAR (Sistem Informasi Nazir) for waqf tracking
• Transparent beneficiary reporting via digital dashboard
Investment Strategy & Instruments
• CWLS (Cash Waqf Linked Sukuk) as primary instrument
• SBSN / sovereign sukuk for fixed-income allocation
• Social impact equities (halal-screened)
• Productive waqf real estate (hospitals, pesantren, markets)
• Tokenized waqf/sukuk via Orbitum platform (digital layer)
• Target: 7-8% blended return; 100% Shariah-compliant portfolio
ORBITUM: TOKENIZING INDONESIA'S SOVEREIGN SUKUK
Orbitum is an innovative platform that tokenizes Indonesia's sovereign sukuk on blockchain infrastructure, enabling fractional ownership, 24/7 trading, and global accessibility. This represents a landmark convergence of Islamic finance and Web3 technology — making Indonesia's state sukuk available to a global digital-native investor base.
How Orbitum Tokenization Works
1
Sukuk
Issuance
Ministry of Finance issues SBSN (sovereign sukuk) through standard regulatory process
2
Asset
Tokenization
Orbitum wraps sukuk into digital tokens on blockchain (ERC-20 / compliant standard)
3
Smart Contract
Compliance
Shariah compliance rules encoded in smart contracts (auto profit distribution, trading limits)
4
Global
Distribution
Tokens listed on Orbitum exchange; accessible to retail & institutional investors globally
5
Return
Mechanism
Periodic ujrah/ijarah returns automatically distributed to token holders via smart contract
Key Benefits
Fractional Ownership
Minimum investment as low as USD 1 via token
24/7 Global Trading
No geographic barriers; instant settlement
Shariah Compliant
Smart contracts enforce shariah compliance automatically
Transparency
On-chain audit trail for all transactions
14
Orbitum – Tokenization of Indonesia's Sovereign Sukuk
Bridging traditional Islamic sovereign finance with Web3 infrastructure for mass financial inclusion
Orbitum is a blockchain-based platform tokenizing Indonesia's sovereign sukuk (SBSN), enabling fractional ownership, secondary market liquidity, and global retail access to Indonesia's Islamic government securities.
What is Orbitum?
• Web3 fintech platform purpose-built for sovereign sukuk tokenization
• Converts SBSN (State Shariah Securities) into digital tokens on blockchain
• Partners with Ministry of Finance & OJK for regulatory compliance
• Uses permissioned blockchain (hybrid: public verification + private settlement)
• Integrated with e-SBN & SBN Syariah government platforms
Tokenization Architecture
• Each token = fractional ownership of underlying sukuk asset
• Smart contracts automate coupon payments & redemption
• Token standards: ERC-1400 (security tokens) or custom Shariah-compliant standard
• Multi-signature custody: OJK-licensed custodian + Orbitum smart contract
• Blockchain layer: Ethereum L2 / Polygon or Hyperledger Fabric
Value Proposition
• Fractional investment: minimum IDR 10,000 (~$0.60) vs IDR 1M traditional
• 24/7 secondary market liquidity (vs. T+2 conventional settlement)
• Global access: diaspora & foreign Islamic investors via stablecoin
• Automated Shariah compliance monitoring on-chain
• Transparent audit trail for waqf-linked sukuk proceeds (LPDU integration)
Orbitum × LPDU Integration
• Tokenize CWLS (Cash Waqf Linked Sukuk) for mass waqf participation
• Digital waqf certificates issued as NFTs with on-chain beneficiary tracking
• Micro-waqf collections aggregated into sovereign-scale investment pools
• Real-time distribution reporting to waqif (endowers)
• First tokenized sovereign social fund instrument globally — game-changer for Islamic fintech
Indonesia's Sovereign Islamic Finance Ecosystem
An integrated value chain from government mandate to digital Islamic investment at scale
GOVERNMENT�(Kemenkeu + Kemenag)
DANANTARA�(Sovereign Wealth)
SBSN / SUKUK�Issuance (MoF)
LPDU�(Sovereign Social Fund)
BPKH�(Haji Fund Manager)
ORBITUM�(Tokenization)
RETAIL INVESTORS�& GLOBAL UMMAH
IMPACT:�SDGs + Maqashid
CONCLUSION & KEY TAKEAWAYS
1
Global SWFs:
Sovereign funds have become essential tools of national wealth management, with over USD 13 trillion AUM globally. Their model continues to evolve with ESG and Islamic finance integration.
2
Indonesia's Ambition:
Danantara represents Indonesia's most ambitious SWF initiative — consolidating state assets to drive development. Sovereign sukuk issuance places Indonesia at the global Islamic finance frontier.
3
Islamic Architecture:
The shariah akad framework (Mudharabah, Musyarakah, Ijarah, Waqf) provides a robust, ethically grounded alternative architecture for sovereign fund management aligned with maqasid al-shariah.
4
LPDU: Historic First:
LPDU will be the world's first Sovereign Social Fund — harnessing religious capital (waqf, zakat) at sovereign scale for transformative social impact. A global model in the making.
5
Orbitum Innovation:
Orbitum's tokenization of sovereign sukuk democratizes access, increases liquidity, and positions Indonesia at the intersection of Islamic finance and Web3 — a blueprint for the global halal digital economy.
Indonesia · Islamic Finance · Sovereign Fund · LPDU · Orbitum | 2025