Wednesday, 27 August 2014

Practitioner Contribution Toward applied Islamic business ethics: Responsible Halal Business.

The purpose of this study  is to explore the opportunities of using halal regulation and certification as a mechanism for applying Islamic business ethics in contemporary world. The main challenge facing any ethical system is the application of Islamic Business Ethics. In the past, Muslims were successful in applying their ethical system through effective mechanisms of applying Islamic business ethics find it difficult to meet the new contemporary challenges. As for methodology, the current practices of halal regulation and certification and literature on Islamic ethics were reviewed, to identify a practical approach for Islamic business ethics. 

Finding shows that Islam allows and accepts different levels of ethical commitment. A multi-level Islamic ethics framework and a multi-level halal certification approach are proposed to facilitate the implementation of Islamic business ethics in a relative context. Two major developments can enrich halal business practices: harmonization of global standards and governance structure, and integrating responsibility and ethical issues in halal standards. For practical implication, the proposed framework and developments can enrich halal regulation and certification practice. To make the proposed steps for a better and faster development of the Halal market possible, collaboration between key stakeholders is required. Till now, the Halal market barely discovered the potential of integrating the concept of CSR and corporate citizenship. 

At the moment, companies and certifying bodies mainly focus on fulfilling the product requirements of a Halal (food/finance) product, such as “not containing pig.” The value shows that this paper emphasizes the importance of flexibility and adaptability in Islamic business ethics implementation, and proposes a new framework and approach to apply Islamic business ethics. The conclusion of the study stressed that Halal regulation and certification forms a good mechanism in order to help Muslims in meeting their religious commitments while living in a globalized and diversified society. Halal business practices vary from one country and industry to another, this variation is due to the differences in the reliability and functionality of institutions and governance structure in those countries and industries. Halal regulation and certification can be developed by integrating some proven tools from the domain of CSR and by including ethics and responsibility criteria with Halal standards. This can be achieved through a multi-level approach that provides Muslims with information on products and businesses covering ethical and responsibility criteria, in addition to the basic Halal standards.

(Summarize based from main reading articles)