Business Ethics in Islam

Al Hud (Hud)
Chapter 11: Verses 84-85

Business Ethics
"To the Madyan people (We sent) Shuaib, one of their own brethren: he said: "O my people! Worship Allah: you have no other god but Him. And give not short measure or weight: I see you in prosperity, but I fear for you the Penalty of a Day that will encompass (you) all round. "And O my people! give just measure and weight, nor withhold from the people the things that are their due: commit not evil in the land with intent to do mischief."

Prophet Shuaib was sent among a people who were very much involved in business. These people were very proud of their business knowledge and success, but they were dishonest. He told them to observe ethics in business. They became very angry with him and told him, "Don't mix religion with business." The Qur'an tells us that Allah's punishment came upon those people and only Prophet Shuaib and his followers were saved.

It is indeed serious that everyone must adhere to ethical standards in business. Business and ethics are not separate, rather they are interconnected. Prophet Muhammad (peace and blessings be upon him) was an ideal human being in every respect. He was a very honest and successful businessman.

Prophet Muhammad gave many teachings on business and economic issues, he covered almost every aspect of business and economics. Here are only a few major principles of fair business dealings according to Islam.

1. No fraud or deceit, the Prophet is reported to have said, "When a sale is held, say, �There's no cheating�" (Al-Bukhari).
2. Sellers must avoid making too many oaths when selling merchandise. The Prophet is reported to have said, "Be careful of excessive oaths in a sale. Though it finds markets, it reduces abundance" (Muslim).
3. Mutual consent is necessary. The Prophet is reported to have said, "The sale is complete when the two involved depart with mutual consent" (Al-Bukhari).
4. Be strict in regard to weights and measures. The Prophet is reported to have said, "When people cheat in weight and measures, their provision is cut off from them" (Al-Muwatta '). He told the owners of measures and weights, "You have been entrusted with affairs over which some nations before you were destroyed" (Al-Tirmidhi ).
5. The Prophet forbade monopolies. "Whoever monopolizes is a sinner" (Abu Dawud ).
6. Free enterprise, the price of the commodities should not be fixed unless there is a situation of crisis or extreme necessity.
7. Hoarding merchandise in order to increase the prices is forbidden .
8. Transaction of haram items, such as intoxicants, are forbidden.