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Islamic Business Ethics for A Prosperous Society

Thursday, March 29, 2018

In today’s highly globalized world, unethical business behavior has caused many problems to arise from economic activities. This neglect for ethics in a capitalist system stems from the assumption that behaving ethically will only lead to lower profits. When capital owners and entrepreneurs aim only to maximize profits for themselves, they put little considerations towards other stakeholders. This leads to many problems such as unfair treatment of workers, environmental destruction and so on. It is therefore pertinent that businesses, as they continue to operate in a globalized world, should also apply a global or international standard for managing business ethically.

Ethics is derived from the Greek word “ethikos” which means custom or character. It is a measure of good behavior, or one that distinguishes between good and bad. Business ethics is therefore a behavior that is in accordance with the norms or rules of ethics adopted in a business setting. This could be applied in an organization, within relationships, or interactions between business partners.

In an Islamic context, the primary purpose of business is to seek the blessings of the Creator and achieve shared prosperity. Islamic business ethics should promote harmony and balance between the interests of the individual and the group. Shared prosperity is achieved when there is harmony and balance.

In starting a business, every businessman or woman is expected to be well aware of the general terms of doing business in Islam. The following are the general pillars of business ethics in Islamic economics to achieve shared prosperity:

1. Unity

Aligning the goals of religious, economic, political and social life towards achieving prosperity for all. Various stakeholders need to collaborate and this includes not just business owners but also government and the general society. The goals are guided by Islamic values based on the Quran and prophetic traditions.  

2. Fairness / Balance

Fairness is one of the main principles of Islamic business ethics. Islam advocates justice in business and prohibits cheating or taunting. The benefits of any business activity are not just for the rich but also for the poor, not just for Muslims but also non-Muslims. Where income inequality exists, it can be plugged by Islamic social financing tools such as Islamic tithe (or zakat), charity and endowment (or waqf). This is really important for the inclusive economy, to level the playing field for attaining prosperity.

3. Honesty

Honesty, or being honest, is the right behavior when conducting transactions, cooperation or agreements in business. Being truthful and honest are a foundational value to attain success in the real world and hereafter. Islam also advocates transparency which can lead to fairness.

4. Freedom

Freedom is an important part of the application of Islamic business ethics.  Islam gives an opportunity to innovate and maximize potential as long as it does not harm the common interest. There is no limitation to work and doing our best as long as it does not make a negative impact on society.

Islamic business ethics is really supportive of shared prosperity, not only for Muslims but humankind in general. Unity, fairness, truth, and freedom in Islamic value might seem difficult in the practical world but will make our business more sustainable.  

Read also : Islamic Crowdfunding - Financing Towards Sustainability

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