Islamic Business Ethics
  • Book Title:
 Islamic Business Ethics
  • Book Author:
Rafik Issa Beekun
  • Total Pages
17
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ISLAMIC BUSINESS ETHICs – Book Sample

ISLAMIC BUSINESS ETHICS

You are the best of peoples, evolved for mankind, enjoining what is right, forbidding what is wrong, and believing in Allah. (Qur’an 3:110)

Every day, individuals face ethical issues at work, and rarely know how to deal with them. A recent review of articles published in the Wall Street Journal during only one week in 1991 uncovered a whole array of issues being faced by employees: stealing, lying, fraud and deceit, etc.[01] Cherrington, J. O. and Cherrington, D. J. 1993. “A Menu of Moral Issues: One Week in the Life of the Wall Street Journal.” Journal of Business … Continue reading Surveys both in the USA and internationally reveal rampant unethical behavior in businesses.

For instance, a recent survey of 2,000 major US corporations revealed that the following ethical problems (arranged in order of importance) concerned managers: (1) drug and alcohol abuse, (2) employee theft, (3) conflicts of interest, (4) quality control issues, (5) discrimination in hiring and promotion, (6) misuse of proprietary information, (7) abuse of company expense accounts, (8) plant closings and lay-offs, (9) misuse of company assets, and (10) environmental pollution.[02] America’s Most Pressing Ethical Problems. 1990. Washington, DC: The Ethics Resource Center, p. 1

Internationally, the ethical values of businesses are also deficient. In a survey of 300 companies across the world, over 85% of senior executives indicated that the following issues were among their top ethical concerns: employee conflicts of interest, inappropriate gifts, sexual harassment, and unauthorized payments.[03] Baumann, Mary. 1987. “Ethics in Business.” USA Today. She was citing data from the Con- ference Board

Is it naive for a Muslim businessman to behave ethically in a globally, competitive environment? The answer is a resounding NO! In Islam, ethics governs all aspects of life. The conditions for everlasting success or falah in Islam are the same for all Muslims–whether in conducting their business affairs or in carrying out their daily activities. Without specifying any situational context, Allah describes people who attain success as those who are “inviting to all that is good (khayr), enjoining what is right (ma‘ruf) and forbidding what is wrong (munkar).”[04] Qur’an 3:104

Within a business context, however, what specific standards of conduct should a company follow? What is a Muslim businessman’s responsibility to internal and external stakeholders? Although a firm’s top executives may exhibit exemplary ethical behavior, how can middle- and lower-level managers be encouraged to behave in a similarly ethical manner? What are some guidelines that would ensure consistent ethical behavior in a Muslim business?

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Defining Ethics

Ethics may be defined as the set of moral principles that distinguish what is right from what is wrong. It is a normative field because it prescribes what one should do or abstain from doing. Business ethics, sometimes referred to as management ethics or organizational ethics, simply limits its frame of reference to organizations.

Within an Islamic context, the term most closely related to ethics in the Qur’an is khuluq.5 The Qur’an also uses a whole array of terms to describe the concept of goodness: khayr (goodness), birr (righteousness), qist (equity), ‘adl (equilibrium and justice), haqq (truth and right), ma‘ruf (known and approved), and taqwa (piety). Pious actions are described as salihat and impious actions are described as sayyi’at.[05] Fakhry, Majid. Ethical Theories in Islam. Leiden: E. J. Brill, 1991, pp. 12-13

Factors Influencing Ethical Behavior in Islam

What is considered ethical behavior may depend on the factors that define and affect ethical behavior. These factors have been identified in Figure 1.

Legal Interpretations

In secular societies, legal interpretations are based upon contemporary and often transient values and standards; in an Islamic society, these values and standards are guided by the Shari‘ah and the collection of previous fiqh judgments. The result of these divergent approaches is amazing: at one time, it was legal and ethical in the United States to discriminate against women and minorities in hiring; now, affirmative action laws make it illegal to discriminate against these groups. By contrast, Islam has given women permanent and unalienable rights, and has never discriminated against minorities on any basis. For example, Abu Dharr reported that the Prophet (saaw) said to him,…

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References / Footnotes

01 Cherrington, J. O. and Cherrington, D. J. 1993. “A Menu of Moral Issues: One Week in the Life of the Wall Street Journal.” Journal of Business Ethics, 11, pp. 255-265
02 America’s Most Pressing Ethical Problems. 1990. Washington, DC: The Ethics Resource Center, p. 1
03 Baumann, Mary. 1987. “Ethics in Business.” USA Today. She was citing data from the Con- ference Board
04 Qur’an 3:104
05 Fakhry, Majid. Ethical Theories in Islam. Leiden: E. J. Brill, 1991, pp. 12-13
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