The document discusses business ethics in Islam, emphasizing the moral principles derived from the Quran and the teachings of the Prophet Muhammad (p.b.u.h). It outlines key ethical values such as truthfulness, trustworthiness, and fair treatment in business transactions, and provides a framework for Islamic business ethics that promotes lawful earnings and mutual consent in trade. The text further condemns practices like hoarding, dealing in prohibited items, and dishonest measures, highlighting the importance of maintaining ethical standards in all aspects of life.

1. Business Ethics in Islam
Submitted By
Zubair Afzal
52-FMS/Bsaf/S-16

2. ETHICS
• Set of moral principles that distinguish what is Right from what is
Wrong.
• The branch of knowledge that deals with moral principles.

3. Ethics in islam
• The term most closely related to ethics in the Quran is khuluq
and in urdu (Ikhlaaqiyaat)
• The Quran 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) and
• Ma'ruf (known and approved).

4. Ethics in islam
• Islam places the highest emphasis on ethical values in all aspects of
human life.
• Islam governs all aspects of life. Ethical norms and moral codes from
the verses of Holy Qur’an and teachings of the Prophet (P.B.U.H).
• Islamic teachings strongly stress the observance of ethical and moral
principle code throughout the Holy Qur’an and numerous teachings
of the Prophet (P.B.U.H).

5. Ethics in islam
“ 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 Surah AL 'Imran)
The Prophet (P.B.U.H) also says
“ I have been sent for the purpose of perfecting good morals”.
(Ibn Hambal, Vol 1 – No:8595)

6. Business Ethics

7. Business Ethics
• Business Ethics are moral principles that guide the way a business
behave.
• That same principles that determine an individual’s actions also apply
to business,
• Acting in an Ethical way involves distinguishing between Right and
Wrong and then making the Right Choice for business.

8. Islamic Business Ethics
Islamic Business Ethics, identifies the practical elements of managing
ethics within an organization that business leaders can use, offering the
framework of an overall Islamic ethics model for an organization to
adopt.

9. Islamic Business Ethics
• Prophet (P.B.U.H) presented in front of us how to be a successful
Muslim trader. He had a remarkable reputation in dealing.
• Many people in Makkah even the enemies were used to praised His
sincerity, honesty, hard work, truthfulness etc.
• Our beloved Prophet (P.B.U.H) always emphasized on fair dealings in
business with the customers. He said:
“ Allah shows mercy to a person who is kindly when he sells, when
he buys and when he claim”.

10. Principles of Business ethics in Islam
1. Freedom of Enterprise.
2. Intensity to earn Halal earnings.
3. Trade through Mutual consent.
4. Truthfulness in Business Transactions.
5. Trustworthiness in Business Transaction.
6. Fair treatment with workers.
7. Not to deal in Prohibited items.
8. Sale of Al-Gharar (Uncertainty, Risks, Speculation).
9. Hoarding of Foodstuff.
10. Swearing (Qasam).
11. Giving Short measures.
12. Dealing in Stolen goods.

11. Freedom of Enterprise
• Islam gives complete freedom to economic enterprise. Each individual
in an Islamic society enjoys complete freedom in the earning of his
business/ occupation.
• He can start, manage and organize any kind of business enterprise
within the limits set by the Islamic Shari’ah.

12. Trade through mutual consent
• Mutual consent between the parties is a necessary condition for the
validity of a business transaction.
• Therefore, it follows that a sale under coercion is not acceptable in
Islam.
• The Holy Qur’an says:
““ O you who have believed, do not consume one another’s wealth
unjustly but only (in lawful) business by mutual consent”
(4:29 Surah AN’ Nisa)
• The Prophet (P.B.U.H) is reported to have said:
“ A sale is a sale only if it is made through mutual consent”
(Ibn Majah, No:2176)

13. Truthfulness in Business Transactions
• Islam encourages truthfulness in business transactions.
• The Prophet(P.B.U.H) is reported to have said:
“ The truthful merchant [is rewarded by being ranked] on the Day of
Judgement with prophets, martyrs and pious people”.
(Tirmidhi, No:1130)

14. Intensity to Earn legitimate Earnings
• Islam places great emphasis on the code of lawful and unlawful in
business transactions. Qur’anic verses disapprove the wrongful taking
of the property.
“And do not consume one another’s wealth unjustly or send it (in
bribery) to the rulers in order that (they might aid) you (to) consume a
portion of the wealth of the people in sin, while you know (it is
Unlawful)”
(2:188 Surah AL’ Baqarah)

15. Intensity to Earn legitimate Earnings
• A Muslim businessman should be wary of the doubtful things in order
to keep himself clear in regard to his faith and his honor.
• The Prophet (P.B.U.H) endorsed the importance of legitimate ways of
earning
“ Leave what makes you doubt for things that do not make you doubt”
( Tirmidhi, No:2442)
“Asked ‘what form of gain is the best? [the Prophet] said, ‘ A man’s
work with his hands, and every legitimate sale’”.
(Ahmad, No:1576)

16. Intensity to Earn legitimate Earnings
• Foremost among the unacceptable business practice strongly
condemned in Islam is Riba (Interest).
“Allah has permitted trading and forbidden Riba”
(2:275 Surah AL’ Baqarah)

17. Trustworthiness in Business Transactions
• Trustworthiness is one of the most important principles of ethical
discipline in commercial transactions. Trust is a moral virtue and duty
mandatory on a Muslim in the performance of his affairs.
“O you believers! Do not betray Allah and the Messenger, nor
knowingly, betray your trusts”.
(8:27 Surah AL’ Anfal)

18. Fair treatment with workers
• Islam puts certain conditions and restrictions to prevent the chances
of bitterness between the employer and employees.
• Islam encourages and promotes the spirit of love and brotherhood
between them.
• It is the religious and moral responsibility of the employer to take care
of the overall welfare and betterment of his employees.
• Fair wages, good working conditions and excellent brotherly
treatment should be provided to the workers.
The last Prophet (P.B.U.H) of Allah said:
“The wages of laborer must be paid to him before the sweat dries upon
his body”.
(Ibn Maajah, No:2434)

19. Not to deal in Prohibited items
• Dealing in unlawful items such as dead meat, pigs and idols (statue) is
strongly prohibited in Islam.
• Dead meat would mean the flesh of any bird or animal dead from natural
causes, without being slaughtered in an Islamic way.
• A verse of Holy Qur’an says:
“ Prohibited to you [for food] are: dead meat, the blood, the flesh (soft
tissues) of swine (pig) and that on which name of other than Allah has been
mentioned”.
(5:1 Surah AL ’Ma’idah)
• Prophet (P.B.U.H) said:
“Allah and His Messenger made illegal the trade of alcoholic liquors, dead
animals, pigs and idols”.
(Bukhari, No:2082)

20. Sale of Al-Gharar (Uncertainty, Risks, Speculation).
In Islamic terminology, this refers to;
• The sale of a commodity or good which is not present at hand;
• Or the sale of a good, the consequences or outcome of which is not yet
known;
• Or sale involving risks or hazards where one does not know whether at
all the commodity will later come into existence.
• Basic conditions for the validity of a sale in Shari’ah are existence,
ownership and possession of goods by seller or his agent.

21. Hoarding of Foodstuff
• It means storing foodstuffs or withholding them in expectation of rise
in their prices.
• Sometimes, a handful of traders operating in the market buy the
entire quantity of an item, for example Sugar, and store it up with the
object of selling it later at the time of scarcity to draw maximum
profit out of it.
• This is unjust practice and a clear case of exploitation and condemned
by Islam. The Prophet (P.B.U.H) is reported to have condemned the
hoarders when he said:
“No one hoards, but the traitors (i.e. the sinners)”.
(Abu Da’ud, No:2990)
“Whoever hoards food away from the Muslims, then Allah will affect
him with and poverty”.
(Sunnan Ibn Ma’jah, No:2155)

22. Swearing (Qasam)
• The traders often recourse to swearing to emphasize that their items
are of good quality. They claim qualities in the merchandise, which
don’t exist.
• They try to persuade the buyers to purchase their commodity by
invoking Allah’s name. Swearing for such purposes is forbidden in
Islam.
The Prophet (P.B.U.H) is reported to have said:
“Swearing [by the seller] may persuade the customer to purchase the
goods but the deal will be deprived of Allah’s blessing.
(Bukhari, No:1945)

23. Giving Short measures
• Another form of dishonesty is to manipulate weights and measures. It
refers to the act of taking full measures from others and giving them
short measures in your turn.
Allah, the Almighty has repeatedly commanded exactitude in weights
and measures.one of the verses says:
“And give full measures when you measure, and weigh with a just
balance. That is the best [way] and best in result”.
(17:35 Surah AL’ Isra)

24. Dealing in stolen goods
• Almighty Allah has declared stealing unlawful and warned of severe
punishment, it is not permissible for a Muslim to knowingly purchase
or sell these items.
• The stolen items are neither to be bought nor sold by those who
know the reality.
• The Prophet (P.B.U.H) made the person knowingly buying a stolen
commodity a partner to the crime. He said:
“The one who knowingly purchase a stolen good, is a partner to the act
of sin and the shame”.
(Kanz al Ummal, No:9258)