Business Ethics

Syyid Fayyaz Ahmad in his paper, "The Ethical Responsibility of Business: Islamic Principles and Implications" highlights several principles and business ethics in the Islamic code of life.
Among the principles and ethics, which I like to share here is related to the problem that Malaysian is facing now – the shortage of supply of packet cooking oil. Last year, the similar issue was persisted in the society where the supply of sugar suddenly dropped in the market place.

Abstaining from Hoarding and ProfiteeringHoarding and profiteering are some of the common forms of business exploitation. Sometimes, traders hoard essential commodities to create an artificial scarcity and crisis, with a view to sell the same at lucrative prices and make exorbitant profits. Islam vehemently condemns such hoarding.

This is the reality and its common to our society. Last year, Malaysians suddenly were faced difficulty to get a supply of a coarse sugar. The problem had prolong for more than six months before it was settled, that was after a government threaten to take a stern action against the produces and to issue a license to another manufacturers to milling a sugar. The government also gave ultimatum to them to start produce coarse sugar at current production rate or the government will be liberalizing the manufacturing and marketing of sugar in the country. Now, the same issue goes to the supply of packing cooking oil, where the supply suddenly missing from the racks of the stores.

The producers are manipulating the supply in hoping that price of the goods will be increased due to the higher demand by the consumers.

Disposition of Surplus Produce
There are cases, where were the producers and sellers had destroyed the surplus of production with an intention to reduce over-supply or to create an artificial scarcity for profit maximisation. Islam does not allows such practise and action. Instead, business organisations must exploring an appropriate ways and means to enable the production surplus benefitted the society.

We had heard sometimes (a few years back) that the chicken broilers in Johor has destroying the chick by burning them to ensure there is no over supply of chicken in the market at that time.

The society will be continuing to face problem whenever honesty are absent from the industry players. It will recur from time to time and the people cannot do much, unless they shift from this capitalist economic system to other economic system. These are among the factors or characterizations of capitalism system, which determine the market survival.