Muslims can look to Islam for direction in every facet of their existence. Any piece of advice worth taking will have some positive outcomes and moral value. In business, it’s the same. Islam provides us with a comprehensive model on how to run a just, fair, and ethical enterprise. Anyone who shares these teachings’ commitment to honest exchange and high moral standards is not limited to the Muslim faith.
1) Only sell legal products
A company must only deal in what is acceptable under the law. It is unethical to exchange goods and services for illegal ones including narcotics, weapons, porn, and interest. Data showing the costs to oneself, others, the economy, and taxpayers, among other groups, is readily available.
According to the National Health Service, alcoholism costs the country £3.5 billion annually to treat. Consuming alcohol on a regular basis has well-documented negative health effects. Cancer, heart disease, stroke, lung disease, and many other fatal conditions are all directly linked to smoking. These are just two examples, but it is well-known that all of the things that Islam forbids are harmful to people and society on multiple levels, including physiological, economic, psychological, moral, and spiritual.
2) Integrity comes in second.
Honesty and keeping one’s integrity are highly emphasised in Islamic teachings. There is a heightened requirement for ethical behaviour in business because of the greater potential consequences of failure.
There is a significant role for trust because of the information gap between the seller and the buyer.
In several of the major corporate scandals of the past few years, such as Volkswagen and Wells Fargo, widespread dishonesty was at play. For the first time, the effect of a drop in stakeholder trust on a company’s financial performance has been concretely defined, thanks to Accenture’s Competitive Agility Index, which analysed 7,000 companies across 20 industries. More than half of the companies on the index (54%) saw a significant decrease in confidence due to incidents including product recalls, fraud, data breaches, and c-suite errors, costing them a minimum of $180 billion in lost revenues, according to the report. Even worse, sales growth slows by 6% and EBITDA declines by 10% on average once trust in a company dips by 2 points, according to research published in Harvard Business Review.
A trustworthy merchant will be in the company of prophets, truthful people, and martyrs, the Prophet (peace and blessings be upon him) remarked. (Sunan at-Tirmidhi)
3) Fair handling of employees
In accordance with a central tenet of Islamic economics, employees must be treated fairly and paid on time. “Give the labourer his salary before his perspiration dries,” the Prophet (peace be upon him) said. “[Ibn Majah] In another saying, the Prophet emphasised the importance of laying out an employee’s salary in advance. ‘Abdur-Razzaq, Musannaf
O those who have believed, complete your agreements, says the Almighty. [Quran 5:1] In this passage, we see the significance of each party keeping their end of the contract.
There was an incident in which God remarked, according to the Prophet: “I will be the opponent of three types of individuals on the Day of Judgment:…and one who hires workers, takes full work from them, and does not pay them their wages.” Citing the authentic Sunni Muslim book of Hadith (Sahih al-Bukhari)
The staff should be treated well beyond just being paid on time. As numerous studies have demonstrated, the following happen when workers are treated well:
- Greater output, growth, and profits as a result of increased employee loyalty and dedication to the company.
- Improvements in the quality of interactions with customers
- reduced time lost from work due to illness
- Staff turnover is low, and employee retention is high.
- Access to a larger pool of qualified candidates from whom to hire.
4) No manipulation or trickery
An essential tenet of Islamic commerce is respect for the other party and their honour. Anything resembling dishonesty or fraud is strictly forbidden. This tenet guarantees that we not only treat our business partners with integrity but also regard them as valuable and worthy of respect.
God warns those who follow him: “O you who have believed, do not consume one another’s money unjustly but solely [in authorised] commerce by mutual consent.” [Quran 4:29]
According to the prophetic account:
One who deceives us is not one of us. Authentic Sunni Muslim Writings [Sahih Muslim]
Another story has it that the Prophet (peace be upon him) walked past a grocery store dumpster full of food. Even though it appeared dry on the outside, when he put his hand inside he felt moisture. What he actually stated was:
To the food’s rightful keeper: “O what is this?”
“Rain did it in, O Messenger of God,” the guy said.
When I asked him why the ruined food wasn’t shown at the top, he answered, “Because I didn’t want anyone to see it.” Someone who lies to us or steals from us is not one of us. Sahih Muslim explains the meaning of this phrase.
5) Giving to those in need
The Prophet urged business owners and entrepreneurs to support those in need. He advised businesspeople to incorporate acts of charity into their operations because “O Businessmen, transactions carry deceit and false oaths.” [al-Nasa’i]
For the sake of this definition, charity encompasses not just monetary donations to those in need, but also action on climate change, efforts to reduce waste, and the pursuit of a zero-waste economic model. Charity also includes a focus on environmental issues, such as the ocean and the blue economy, as well as a commitment to sustainable practises and the achievement of the Sustainable Development Goals (SDGs).