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Islamic Ethics on Business Transactions


One of the fundamental problems facing the world today is the lack of ethics and fair-dealing. In politics, administration, business, media, academia and public life- virtually everywhere- the tentacles of corruption manifest itself in different ways and forms. So much so that most countries in the world are neck deep in irregularities and corrupt practices. Sadly, Muslims or their countries cannot absolve themselves from blame and shame in this connection. Yet, the teachings of Islam and the noble example of the Holy Prophet of Islam (sa) points to the value of integrity and ethics and fair dealing in all that we do and Islam prescribes a normative code of conduct for economic activities. In his Friday Sermon of April 12, 2013 the Khalifatullah Hadhrat Munir Ahmad Azim Sahib (atba) profoundly expounded on these ethical principles in the backdrop of the high profile-corruption and fraud cases in Mauritius and elsewhere.  

Read the Extracts from the Friday Sermon:

In the Holy Quran Allah says:

“Do not usurp one another by unjust means, nor bribe with it the judges to wrongfully deprive others of their part.”  (Al-Baqara 2: 189)

“… give full measure and weight in justice and do not deprive the people of their due and do not commit abuse on the earth, spreading corruption.” (Hud 11: 86)

Give full measure, when you measure, and weigh with even scales. That is fair and better in the end.” (Ar-Rahman 55:  10)


Islam places great emphasis on sticking on the path of rectitude in all dealings, be it at familial, business, social, economic and all that centres on man and his morals. Islam forbids fraud and breach of trust, and forbade them in all circumstances, whether in the sale, trade, or in science and transactions. It is saddening to see with each day that passes that the world population is involving itself in one way or another in immoral activities, such as fraud, corruption, business irregularities, giving and taking bribes, and all such dealings which bring shame to its spiritual and mundane aura. And what is saddening is that Muslims are not separate from this kind of blacklisted population, those who are adamant in persisting in evil ways while maintaining exteriorly an Islamic face and behaviour. The garb of a true Muslim is his heart which regulates his soul. If his heart is clear and filled with fear of God and appreciation for righteousness and justice, then he shall come what may strive to make the commandments of God a reality in his everyday life. He shall strive to make the people around him stick to righteousness and abandon the evil ways.

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 organise any kind of business enterprise within the limits set by the laws of Islam, that is, the Shariah. However, freedom does not and must not operate without a sense of responsibility. Indeed there are limits that are to be respected, for if not, then proper control on the administration of justice and fairness cannot be done.

An individual is free to pursue his economic activities provided he respects the code of conduct prescribed for the profession, which broadly means remaining within the legal frame and shunning all that is unlawful. He has the foremost duty to encourage good and shun evil, and he has to begin within his own self, refining his interior and then putting into practice business according to Islamic norms. The prescriptions of the Holy Quran and the teachings of our Holy Prophet Hazrat Muhammad (pbuh) 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.

For example, in his many sermons, the Holy Prophet Hazrat Muhammad (pbuh) has said:

“He who cheats is not of us. Deceitfulness and fraud are things that lead one to Hell.”

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 Quran 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 (1) prescriptions of the Holy Quran and the teachings of the Holy Prophet Muhammad (pbuh) and (2) the directives of the temporal authority, the chief or judges who have the foremost duty to judge with fear of Allah and with justice. During the early centuries of Islam, this function was mainly performed by the institution of market inspectors. This institution was an important institution whose functions were broad-based and multifarious, the most important 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. Moreover, Islam has stressed and asserted the importance of honesty in monetary dealings and highlighted its vital role in social stability and peacefulness.

The seller and the buyer have the right to keep or return the goods as long as they have not parted or till they part; and if both the parties spoke the truth and described the defects and qualities (of the goods), then they would be blessed in their transaction, and if they told lies or hid something, then the blessings of their transaction would be lost. (Bukhari)

The tradition implies that Allah blesses business dealings if both parties in the transaction are true to each other. Telling lies and hiding facts will result in the loss of divine blessing.

The Holy Prophet (pbuh) said: “Traders are wicked people”. The Companions asked: “O Messenger of Allah, has Allah not permitted business?” The Messenger of Allah (pbuh) replied: Of course He has declared trading lawful. But they (that is, the traders) will swear by Allah and do evil, they will not speak but tell lies”. (Ahmad)

Allah says in the Holy Quran:

“Oh you who believe! Do not eat up each other’s property by unfair and dishonest means.” (An-Nisa 4: 30)

Muslims should do everything in their power to resist the urge to deal dishonestly.  Dishonesty, cheating, or fraud leads to problems.  It hurts others, and damages your integrity.  It destroys the trust of others in you.  Allah will punish such acts.  As He said in His Book, the Holy Quran:

“Woe to those that deal in fraud, – those who, when they have to receive by measure from men, exact full measure, but when they have to give by measure or weight to men, give less than due. Do they not think that they will be called to account- on a Mighty Day when (all) mankind will stand before the Lord of the Worlds.” (Al-Mutaffifin 83: 2-7)

Therefore, it is up to us to ensure that we apply the dictates of the Holy Quran and the traditions of the Holy Prophet Muhammad (pbuh) so that our society becomes truth and purity. Nowadays, Muslim states are only in name. While applying on one hand the Shariah for a certain class of people, but for the nobler class, all sorts of immoral practices are tolerated in the name of modernisation and globalisation. If the Church has paganised the Christians, now it is up to us Muslims to ensure that we do not let ourselves be westernised by the limited laws and practices of the West. Allah has vouchsafed us the best Book, the Holy Quran, given us the best prophet Hazrat Muhammad (pbuh) as role model and the best religion, Islam as the true way of life. Therefore if we follow the lead of these precious examples, then we can assure our future and that of our children; but if not, then the Muslims shall taste much more defeat through our own non-respecting of the divine commandments. In unity and respecting the legal frame of Islamic practices, we can assure a future for the new generations, because if not, they shall fall prey to the evils of a so-called modern society.

May Allah enable us to accomplish our task in the best manner. Insha-Allah, Ameen

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