An Islamic Approach to Business Ethics What is Ethics? Ethics may be defined as the set of moral principles that distinguish what is right from what is wrong. Ethics has a twofold objective: it evaluates human practices by calling upon moral standards; also it may give prescriptive advice on how to act morally in a given situation. Ethics, therefore, aims to study both moral and immoral behaviour in order to make well-founded judgments and to arrive at adequate recommendations. Sometimes ethics is used synonymously with morality. An action, which is morally right, is also called an ethical one. Codes of morality are called ethical codes. Business ethics can also be defined as business morality. Business Ethics Business Ethics is the branch of ethics that examines ethical rules and principles within a commercial context; the various moral or ethical problems that can arise in a business setting; and any special duties or obligations that apply to persons engaged in commerce. Generally speaking, business ethics is a normative discipline, whereby particular ethical standards are formulated and then applied. It makes specific judgments about what is right or wrong, which is to say, it makes claims about what ought to be done or what ought not to be done. Generally speaking, business ethics is concerned with the study of what is good and bad, right and wrong, and just and unjust in business. Ethics in Islam Islam places the highest emphasis on ethical values in all aspects of human life. In Islam, ethics governs all aspects of life. Ethical norms and moral codes discernable from the verses of the Holy Qur’an and the teachings of the Prophet (sws) are numerous, far reaching and comprehensive. Islamic teachings strongly stress the observance of ethical and moral code in human behaviour. Moral principles and codes of ethics are repeatedly stressed throughout the Holy Qur’an. Besides, there are numerous teachings of the Prophet (sws) which cover the area of moral and ethical values and principles. Says the Holy Qur’an: You are the best nation that has been raised up for mankind; You enjoin right conduct, forbid evil and believe in Allah. (3:110) The Prophet (sws) also says: I have been sent for the purpose of perfecting good morals. (Ibn Hambal[1], No: 8595) This goes without saying that there is a general consensus among human beings about certain fundamental ethical values. However, the Islamic ethical system substantially differs from the so-called secular ethical systems as well as from the moral code advocated by other religions and societies. In the Islamic scheme of things, adherence to moral code and ethical behaviour is a part of I%man (faith) itself. According to the Islamic teachings, Muslims have to jealously guard their behaviour, deeds, words, thoughts, feelings and intentions. Islam asks its believers to observe certain norms and moral codes in their family affairs; in dealings with relatives, with neighbours and friends; in their business transactions; in their social affairs, nay in all spheres of private and public life. Islam has its own distinctive value-based ethical system for business dealings. It prescribes certain specific guidelines for governing business ethics. It (i) enumerates the general ethical rules of business conduct, (ii) identifies ethically desirable forms of business, and, (iii) specifies the undesirable modes of transactions. Given the nature of Islamic ethical and moral codes, it would be beyond the capacity of one paper to fully comprehend the subject. In the following pages, our effort will be to confine ourselves to the discussion of some specific principles of business ethics in Islam. Freedom of Enterprise Islam gives complete freedom to economic enterprise. Each individual in an Islamic society enjoys complete freedom in the earning of his livelihood. He can start, manage and organize any kind of business enterprise within the limits set by the Islamic Shari‘ah. However, freedom does not and must not operate without a sense of responsibility. An individual is free to pursue his economic activities provided he respects the code of conduct prescribed for the profession, which broadly means choosing things lawful and shunning matters unlawful. The dictates of the Holy Qur’an and the teachings of the Prophet (sws) serve to set a scale in everybody’s mind to distinguish between the lawful and the unlawful means of earning, and to prohibit or disapprove of all things that are either morally wrong or socially unacceptable. Islam, as a matter of principle, prohibits all activities which may cause harm either to the traders or the consumers in the market. It encourages the prevalence of free market where everyone earns his sustenance without government intervention. However, it puts certain restraints in order to eliminate the incidence of injustice and check malpractices and unlawful operations. In all other respects market in Islam is free from any state intervention. However, if the people fail to take guidance from the Holy Qur’an in matters relating to business transactions, an Islamic state will strive to organize the market transactions on sound Islamic principles. Freedom of enterprise in an Islamic market will, therefore, be regulated by the (i) dictates of the Holy Qur’an and the teachings of the Prophet Muhammad (sws) and (ii) the directives of the temporal authority. During the early centuries of Islam, this function was mainly performed by the institution of Muhasbah (headed by a Muhtasib or market inspector). The institution of Muhasbah was an important institution whose functions were broad-based and multifarious, chief among them being keeping a watch on the harmful practices prevalent in the market and the society and checking the incidence of injustice and malpractices in the market.
Posted on: Sat, 24 Jan 2015 20:59:25 +0000
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