Multinationals, business and Islam

The Ethics in the Workplace seminar organised by IBE on 24 October 2005 with David Logan was excellent. I have heard a lot about IBE as well as about David Logan, and the seminar confirmed my belief that both are doing some very important work in promoting ethical business practices. Having listened to David and others at the seminar, three things came to my mind. Firstly, I am rather perplexed to hear the suggestion that religion generally is sceptical of business. I have always thought that religion in general advocates the right – or even the necessity – of man to work and to rid himself of hardship and poverty. For example, both Islam and Protestant Work Ethics promote hard work and discourage dependence on help from others. I am sure if we go through the basic tenets of other religions we will find teachings in similar spirit. Secondly, the observation that Islam is very accepting of business is certainly true. The Prophet Muhammad himself was involved in trade and his first wife was also a very successful businesswoman. While many call Adam Smith the father of economics, I would suggest we read texts by Ibn Khaldun, a great Muslim sociologist and economist, who advocated free-market economics 300 years before Smith. If we look at the works of Ibn Khaldun, we will discover that Islam embeds ethics as an integral part of the economic system. In Islam, businesses too must flourish if the nation’s economy were to grow. But at the same time, businesses have to be ethical, for otherwise the managers will face the consequence. And even if they escape “worldly” consequences of unethical business practices, they will definitely not be able to avoid Allah’s judgement in the hereafter. Thus, in Islam, even in the absence of pressure groups or NGOs promoting ethical business practices, businesses must still be socially responsible because God is the ultimate advocate of CSR! In contrast to Smith’s assertion that CSR is an unintentional by-product of self-interested quests, Islam makes no distinction between CSR and profitability. Both are important and neither can be put above the other. And in contrast to Adam Smith, Ibn Khaldun did not just advocate free-market economics. He outlined the basic principles of ethical free-market economics. Thirdly is the issue of imperialism. I believe the constant repetition of issues like emancipation of women is influenced by how we look at imperialism. In the seminar, someone mentioned that capitalists have changed their attitude - capitalists no longer have anything to do with imperialistic agenda. I too believe that physical / political imperialism is not a motivating factor for capitalists nowadays. Nevertheless, when discussing imperialism, many Muslims do not talk just about political / physical occupation. But they worry about ethical imperialism. An imperialism in which an external power – be it a foreign government or a foreign multinational - forces an alien set of values onto the Muslim society. I think the refusal to accept foreign values is not unique to the Muslim world. Let me illustrate by using the example of dress-code. In Islam, women should cover themselves from head to toe, exposing only the face and palms. This is interpreted differently across culture – there are variations between women’s attire in Malaysia and in Iran, for example. If a multinational from the UK opens a branch in Jeddah, should they say that Muslim women should do away with the hijab under the guise of women emancipation? Or should they respect the local culture and encourage women to abide by their religious belief? Just imagine the reverse. Here in the UK, women wear differently from in Saudi Arabia. What would we say if a multinational from Jeddah opens a branch in London and starts telling all female staff regardless of their religion to put on the hijab? If a western company can impose their beliefs onto a society in a different country, how will we react if companies from that country start imposing their values onto the western society? Surely even we in the West will reject ethical imperialism. When going into a society with a totally different set of values, multinationals should respect the cultural differences. Yes, there are some values that are universal like integrity, honesty and social responsibility. But in everything else, universality of values is questionable. The answer lies in ethical relativism, not ethical imperialism. .