According to Muslim belief The Qur'an teaches us how to live our lives as complete human beings. This is understood to apply to money as well as to all other goods and services. God has laid down these eternal values in His revealed Book and conveyed them through His Prophet. Its function was to encourage and help people to observe Islamic tenets and rituals, and, in particular, to ensure and facilitate a healthy environment in public places, mainly shopping centres. The Compacts, the Declaration and the Principles all have many good points and need to be supported. The manmade laws and regulations act as a secondary support and help suppress any digression by those who have become weak in their belief. All rights reserved, The Movement of Business Ethics in the West, IIBI Institute of Islamic Banding and Insurance. It recognises the significance of wealth as an adornment of this worldly life. This value is prescribed in legal, social, moral and economic dealings. The economic systems that exist today are … Belief in God provides not merely the motivation, but the imperative for adhering to shariah law, which is to be applied in all spheres of life. I realized that the only way I could reduce the inconsistency between what I believe, and what I am supposed to follow, is to act in accordance with my religious beliefs regardless of the consequences that I may encounter throughout my life. Muslims have a huge advantage in being able to turn to their religious teaching for guidance in their business dealings. Revealed teaching provides moral certainty, and a set of standards to which the entire community of believers can adhere. 3 No. At the same time, Muslims have the right to enjoy whatever wealth they acquire and spend in sharia-compliant ways; they don’t need to feel shame about being … The first is the option on account of false description, where the seller has sold goods as possessed of some good quality. Published by the Institute of Islamic Banking and Insurance, London, UK 2003]. If you continue browsing the site, you agree to the use of cookies on this website. And the discourse is instead occupied by lawyers, theologians and traditional ulama (religious scholars … The first of the Islamic philosophers, Abu Ya`qub al-Kindi wrote in his On First Philosophy, “Philosophy is the knowledge of the reality of things within people's possibility, because the philosopher's end in theoretical knowledge is to gain truth and in practical knowledge to behave in accordance with truth.” 9 Al-Farabi, while accepting this definition, added the distinction … Philosophy developed out of and around the nonreligious practical and theoretical sciences, it recognized no theoretical limits other than those of human reason itself, and it assumed that the truth found by unaided reason does not … It was also supposed to protect the rights of service providers, traders, craftsmen, customers and visitors. It is ideal for students coming to the subject for the first time as well as anyone wanting to learn about the philosophical tradition and dilemmas that are part of the Islamic worldview. These universal ethical values and virtues are, however, constrained by temporal and spatial limitations because of the need to apply them to achieving the interest of some particular person, society, class or territory. Business ethics, in the Islamic concept, approach to entrepreneurs Abstract contributor to the economic development of a country. The discussion of the notion of meaning in Islamic philosophy is heavily influenced by theological and legal debates about the interpretation of Islam, and about who has the right to pronounce on interpretation. Unlike Maxime Rodinson (1977), who asserted that Islam was incompatible with capitalism, in this study there is seen to be no conflict; indeed, a distinctive form of Islamic capitalism is starting to emerge. concept of the soul, and what constitutes truth. One cannot be a true Muslim unless one adheres to these values. Dr S M Hasanuzzaman, published by the Institute of Islamic Banking and Insurance 2003]. Institute of Islamic Banking and Insurance We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. [Extract from Preface of Islam and Business Ethics by Dr S M Hassanuzaman,  a cynical reaction that the Islamic model existed in history and concept only, but never practiced in modern life, even by countries with a Muslim Majority”9. Islamic perspective is more suitable in explaining ethics as it is comprehensive, moderate and realistic (al-Aidaros et al., 2013). It implies a more liberal treatment than justice demands. No civilisation could progress and no social, economic, political, scientific or technological development would be possible without people adhering to the values of patience, perseverance, determination, tolerance, strength of resolution, self-control, cool temperament and mutual consideration. EDUCATIONAL PHILOSOPHY ISLAMIC CONCEPT OF EDUCATION Islam has presented the concept of accountability of deeds in hereafter and the universal philosophy of life. The issue of insider trading is also considered, a practice that is illegal in most jurisdictions, but which too often goes undetected to the detriment of shareholder and other stakeholder interests. Concept of Islam & Economics . Good salesmanship does not necessarily involve falsity and deceit. Material prosperity enjoys God's blessing and is desirable. These efforts to make business more ethical may be objected to on many grounds. Having understood the concept of ethics and seen the different schools of moral philosophy, it is now time to focus on the ethical philosophy of Islam. Many question why the global economy appears so unjust, with huge income and wealth disparities and exploitation all too apparent. The objective behind the set of eschatological beliefs is to root out a mundane materialistic outlook on wealth, which dissuades one from discharging one's social responsibilities. 11390908 He also enjoys the option to rescind the contract of sale if the buyer fails to pay the price within the stipulated period. Stock markets, a hotbed of organised swindling, confederacy and complicity, also need serious treatment. Deceitful publicity persuades the consumer to buy a thing which actually does not possess the attributes conveyed in the advertisement and for which the consumer becomes agreeable to part with his money. Justice and equity, honesty, integrity, veracity, leniency, compassion, tolerance, selflessness, benevolence, cooperation, mutual consideration, sacrifice and harmlessness, are the guiding values in all walks of life, business being no exception. It contains a lot of brief, yet informative articles about different aspects of Islam. Muslim philosophers both profess Islam and engage in a style of philosophy situated within the structure of the Arabic language and Islam, though not necessarily concerned with religious issues. I he significance of the movement lies in the realisation of the evils caused by a value-free system. The capitalist countries in the West, where ethics have been alien to business activity for some time, are not in search of a moral code for business. What rate of profit he should charge is determined largely by market forces and the nature of the competition, given a normal or prevailing price. He condemned the ousting of a new entrant in the market. Moreover, the critics should distinguish between two things: the objectionable role of the East India companies, on the one hand, and the MNCs and the need to reform them on the other. Market mechanism which Islam visualises Even so, there are Muslim entrepreneurs It will not be out of place to point out here that the US Department of Commerce has also released Model Business Principles, thereby encouraging corporations to develop their own codes of conduct. It also implies that human life as a whole should be subjected to the values that God and His Messenger have prescribed. Absolute justice is a legal requirement and, therefore, essential, but the Prophet, in line with the Qur'anic requirement, has persuaded his followers to behave magnanimously in claiming their rights and be generous in discharging their duty. Introduction • The process of “Islamize” the economic system raised several theoretical and … Another argument against the movement that has much weight and logic behind it is the movement's incongruity with the philosophy of life that Western thinking has hitherto upheld. Dr Waseem Khan. Some would argue that Islamic philosophy has never lost its concentration on the Qur’an and other significant Muslim texts, and that throughout its history it has sought to understand the essence of the realities both of the Sacred Book and of the created world. Trust matters in business, and where there are shared religious values, this creates great opportunities for industry and commerce as analysts of Muslim history have observed from the time of Ibn Khaldun. The concept lays down the rate of profit but not the sale price. Businesses should promote ethical standards in their enterprise, People involved in business should always be honest, truthful, and fulfil all promises and commitments. ... Economic Philosophy of Islam. . God has ordained that these values should be observed by the entire human race for all time, with the object of seeking God's pleasure and to earn a reward in the next world. Absolutely free trade, an unregulated market mechanism and cut-throat competition have been the motivating forces of traders. ‘When we say that prices must be just, or fair, does this justice or fairness involve a moral value? It does not try to suppress human instincts that motivate one to work hard, organise one's economic activities efficiently and profitably and discover new methods of exploiting resources and multiplying wealth. ... (permitted) as business creates employment opportunity for the people as well as contributes to the GDP growth of the country. The Institute, with the consensus of the three communities, adopted a declaration that emphasised the key moral values of justice, mutual respect, trusteeship and honesty. 3 The Islamic banking transactions … Over time, it has been tweaked by Muslim scholars to adjust for changes in the socio-political and economic circumstances without sacrificing the basic principles laid out in the Holy Quran and reinforced by the Holy Prophet, peace and blessings of Allah be upon him. Henley Business School, University of Reading (United Kingdom). In addition to these general values, there are sector-specific injunctions to guide different sectors of activities meticulously. [Extract from Preface of Islam and Business Ethics by Dr S M Hasanuzzaman, published by the Institute of Islamic Banking and Insurance, London, UK 2003]. Banking business, a centre of misappropriation and exploitation of its owners — the depositors — insurance companies which inherit a propensity for trickery and fraud, health and education, which trade on the life and intellectual growth of generations, are also going unnoticed by our scholars and critics. A core concept of Islam is that the owner of all wealth in the world is Allah and that humans are merely its trustees. The Islamic Concept of Knowledge. Many of the ethical values laid down in Islam are not unique to Islamic society. Adoption of codes of conduct reflecting these principles is made voluntary. Among these values, justice and benevolence (ihsan) are the most important. Business immorality has becomes a universal menace. A third kind of option the buyer enjoys arises as a result of a defect in the goods which the seller has knowingly concealed. The Qur'an makes a mention of a number of economic pursuits in a tone of approval, except for a few that it condemns. A look at the Interfaith Declaration and the Caux Principles reveals an almost identical approach to the issues involving MNCs. The secularist intellectual orientation in the West had pushed ethical values to a secondary position and divorced economic activity from its fold. In another sense it refers to any of the schools of thought that flourished … Islamic ethical values represent universal ethical values. Paradoxically despite the decline in the influence of religion in the West, there has been a reaction by many to corporate excesses and the malpractices associated with capitalism. [Extract from Preface of Islam and Business Ethics by Dr S M Hasanuzzaman,  The market mechanism calls for the unhindered interplay of the forces of demand and supply in determining the price of a product. The concept of justice in an economic context encompasses fairness, equity, balance and equilibrium, symmetry and impartiality. If you continue browsing the site, you agree to the use of cookies on this website. The Jihad, Thus a businessman whose object is earning his livelihood through a business activity without violating these principles is treated, in the next world, as being on par with the apostles. If we are advancing towards forming a world community, governments and businessmen should demonstrate feelings of mutual consideration and sympathy for the members of a human community who are the children of Adam and Eve, the family of God. We are also considered to be both the viceregent of God on earth and His servants. A person who observes the basic values and abides by the guiding principles of trade, as laid down in the Qur'an and the Hadith, is deemed to be commendable in this world and in the Hereafter. The Ottoman Code of Civil Law defines grave deception as higher than 5% (profit) on goods, 10% on animals and 20% on immovable property. 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