Learn Quran Online

Book 3 days Free Trial classes


Your form submitted successfully!


Sorry! your form was not submitted properly, Please check the errors above.

Google reviews
Trustpilot reviews
Business ethics and Etiquette in Islam

Business ethics and Etiquette in Islam

Islam, unlike other religions, doesn’t merely focus on worship alone. Things that may not usually be associated with religious practices are also included in Islamic injunctions. Islam is a complete way of life, and Allah, being the All-Knowing, has included a code of conduct for several different walks of life. Islam focuses on individual and social aspects alongside legal and cultural issues. The Sunnah also covers business-related and political facets. Allah says to be just when establishing weight in Surah Ar-Rahman.

Upholding Islamic Values in Business

Businesses, as with any other organization, must stick to a certain quality of standards and defined values. Since Allah has provided in-depth instructions about halal and haram in all facets of life, we must ensure we implement the right things and shun those that are wrong. We must always encourage the halal and try to eliminate the haram.

All aspects of a business must be Shariahcompliant. This means that no rules and laws of Islam can be discarded. Countries often have their own laws and regulations for businesses. However, Islamic laws are ahead in terms of their importance. Businesses must adhere to ethical standards and certain etiquette.

Challenges of Capitalism and Ethics in Business

Nowadays, we see the evils of capitalism around the world, rearing their ugly heads. Large businesses often keep growing larger, and the rich get richer. Usually, the richer they get, the less ethical they become. Large businesses and corporations are often ‘untouchable’, and they can negatively affect the livelihood of many people. Smaller businesses and companies also have a particular code of ethics that must be followed to be Shariah-compliant.

Business and the Prophet (PBUH)

The Prophet’s Early Life: From Shepherd to Businessman

The Holy Prophet (PBUH) was a shepherd in his early years. Later, he went into the field of business, becoming a businessman and trader. He worked alongside his uncle, Abu Talib, who looked after him from a young age. The Messenger of Allah (PBUH) went on trips to far-off lands for the sake of business.

Business Ventures with Khadijah (r.a.)

As described by Ibn Ishaq, Khadijah bint Khuwailid (r.a.) was a virtuous businesswoman. She employed men to help with her business; they got a percentage of the profits. When the Prophet (PBUH) was 25 years old, he went to Syria as a merchant of Khadija (r.a.).

The Importance of Character in Business

The Prophet (PBUH)’s great honesty and excellent reputation made Khadijah (r.a.) request for his services. And when he returned from the trip, Khadijah (r.a.) noticed the increased profits and blessings. A worker who accompanied the Prophet (PBUH) on the trip also praised his character traits in general.

A combination of these factors made Khadijah (r.a.) decide to marry the Prophet (PBUH). She had initially chosen Muhammad (PBUH) as the person to go on a business trip, showing us the importance of a person’s character in trade and business dealings. That, indeed, bore fruit as she gained more profit and blessings.

This plays a significant role in a Muslim’s behavior toward others. Conscientious and ethical businessmen ensure that they clearly differentiate between right and wrong.

Islamic ethics derive from Allah’s instructions in the Quran and the Prophet’s (PBUH) actions and teachings. Islamic ethics deals with all the different aspects of life, which also covers business etiquette. Financial ethics in Islam are of the utmost importance.

Unlike the prevalent money-oriented and self-centered world nowadays, Islam focuses on the well-being of society. It encourages moderation in human beings, with a heavy focus on the afterlife. Brotherhood and justice are matters of immense importance.

Importance of being honest In Lights Of Islam

Honesty is one of the most important aspects of Islam. Allah makes it clear on numerous occasions in the Quran that lying is a despicable act, such as in Surah At-Tawbah. With businesses, the importance of honestly is multiplied as blessings are lost if lies are involved.

In Sahih Muslim, the Prophet (PBUH) stated that both parties doing business can cancel the agreement provided they have not separated. If they are truthful, their business will be blessed, however, lying or deceiving in the transaction will destroy its blessing.

In Sunan At-Tirmidhi, the Prophet (PBUH) stated that the traders will be resurrected on the day of resurrection with the wicked, except for those who are pious, who are generous and honest.

Importance of being lenient

In Sahih al-Bukhari, the Prophet (PBUH) invoked Allah’s mercy on one who’s compassionate in his purchases, sales, and when asking for the return of his money. The Messenger (PBUH) encouraged an easy-going attitude, and advised against pressurizing people.

A part of leniency is to allow buyers to cancel transactions if they wish to do so. This avoids putting an undue amount of pressure on the one making the purchase , who may have a good reason for canceling it. In Sunan Abi Dawud, the Prophet (PBUH) said that one who allows a Muslim to pull out of a transaction will be relieved of his distress on the Day of Reckoning by Allah.

Importance of paying off debts

The Islamic Perspective on Debt

A narration in Sahih Muslim states that the best men are the ones who are preeminent when it comes to paying off debts. Debts are a grave matter in Islam. Taking loans without interest is permissible, but the borrower should understand the importance of repaying them. Ideally speaking, loans should only be taken when they are absolutely essential.

Responsibility of Debt in the Afterlife

Being in debt is one of the things which can harm a believer even after he is dead. The debt is the right of another person. Thus, the obligation remains and needs to be fulfilled by the deceased person’s relatives in such cases.

Compassion and Charity in Debt Settlement

Having said that, people are also encouraged to give extra time to debtors or waive repayments when possible. In Sunan Ibn Majah, the Prophet (PBUH) said that one who desires Allah’s shade should provide ease to one facing hardship or waive loan repayment.

Promoting Islamic Values in Business to Foster Responsible Debt Practices

Businesses are often guilty of greed, taking loans beyond what they need. They also frequently delay paying them back. Alternatively, lenders are harsh with people who cannot pay back debts at the pre-arranged time and rarely allow lenience, which is against the tenets of Islam.

Contracts are important in businesses

Allah discusses the importance of contracts in some lengthy verses in Surah al-Baqarah. He stresses that believers should write down debts. They should let scribes write them down without omitting anything. These Quran verses on ethics are important for business people to know.

Contracts help to bring clarity to transactions, partnerships, etc. Contracts ensure that Muslims have evidence of the agreed upon terms, which will avoid unnecessary haggling in case of a dispute. For businesses, they are a must.

Internally, they ensure that business partners and owners are all on the same page. When the contract is with other businesses or companies, a written deed is essential as a form of legal evidence.

Be just with people

In Surah An-Nahl, we learn that Allah commands us to be just and observe good conduct while prohibiting immorality, poor conduct, and persecution. Justice is one of the most important things in Islam. Justice is what keeps the world in balance, and justice is what Allah will mete out to human beings on the Last Day.

As a business etiquette, this applies both internally and externally. A business owner must be just with his workers and be fair with them. Favoritism and bias are not permissible. He or she should also treat customers equally. Islam strictly prohibits discrimination.

Sincerity of intention

In Sahih al-Bukhari and Muslim, the Prophet (PBUH) said that actions are judged and rewarded based on their intentions. The intention of a Muslim is the most crucial part of any action. If a person is sincere towards Allah and has the right intentions, he is on the right path.

As a business ethic, sincerity ensures that a person works for the correct purpose. He doesn’t do things with ulterior motives in mind. Hence, he will always focus on the betterment of the business. A business owner who is mindful of this will be sure not to exploit his workers.

Usury is amongst the things forbidden for a business

usury in business

Riba (usury) is one of the most heinous sins in Islam. And it is also one of the most prevalent sins nowadays. In Surah Al-Baqarah, the believers are told to let go of whatever they are owed of interest. If one does not obey this command, Allah and His Messenger will be at war with him.

Riba originated from jahiliyyah (the period of ignorance). The Prophet (PBUH) cursed the person who takes riba, the person who pays it, and the person who is a witness for it. The scholarly consensus is that riba is completely forbidden as it has many harmful effects on society. The top-most of the adverse effects is the undesirable impact on those in need, while those who are wealthy and can afford to lend money become richer.

Nowadays, businesses are often guilty of both giving and taking riba. It has become one of the defining features of the world’s economy. The complete financial structure of the world now depends on this haram feature. Still, Muslims must do all they can to ensure that they stay far away from engaging in this appalling act.

Bribery is a despicable act

In Surah Al-Baqarah, we are ordered to abstain from the sin of bribery. Bribery is an unethical act from almost any point of view. Thus, it is naturally forbidden in the religion of the best of morals – Islam.

According to a report in Sunan Abi Dawud, the Prophet (PBUH) cursed both the person who bribes another as well as the person who accepts the bribe. This harsh statement shows the gravity of the sin.

The importance of charity for a business

charity in business

The Prophet (PBUH) recognized the perils of business and trade. When put in these situations, people may do things that go against Allah’s will. Hence, it is essential to keep charity in mind to ensure that a person is doing something that will help him attain Allah’s forgiveness.

That is why the Prophet (PBUH) told traders to mix some charity with their business, as reported in Sunan Ibn Majah. Additionally, charity results in barakah (blessings).

In Sahih Muslim, the Prophet (PBUH) said that one who wishes for Allah to rescue him from the calamity of the Last Day ought to give additional time to one who is facing financial issues or absolve that person.

The compatibility of businesses with Islam

As we can see from the life of the Prophet (PBUH), businesses are a part of life. Buying, selling, and trading are completely legitimate ways of making a living. Muslims have to support their families and communities. Almost every human being will be involved in this at some point in their lives.


However, Allah has given us clear guidelines about the permissible and the impermissible. To ensure that we are on the right path, we must adhere to the pristine teachings of Islam. The only way to succeed as a Muslim is by obeying Allah and His Messenger (PBUH). Any success that comes at the expense of obeying Allah is just a temporary illusion, which we will regret in the Afterlife.