1. Convergence in Corporate Governance Systems: Reconciling Islamic and Western Business Practices.
- Author
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Miles, Lilian
- Subjects
- *
CORPORATE governance , *ISLAM , *BUSINESS , *CAPITALISM , *ECONOMIC activity , *CORPORATE image - Abstract
"It has been argued that all business systems will eventually converge along the lines of the western capitalist model. The adoption of such a model is increasingly viewed as the optimal means of maximising resources and encouraging creativity and scientific innovation. It is however, questionable whether the transplantation of western models and values are compatible with Islamic requirements as to how business ought to be managed. Islam prescribes that all Islamic organisations must serve God and develop a corporate culture which promotes morality and spirituality and which advances the achievement of Islamic objectives. Islam prohibits interest based transactions and economic activity which involves speculation and hoarding. It obliges businesses to take care of their stakeholders and urges managers to be kind, trustworthy and exercise holy stewardship of their assets. These principles appear to conflict with the profit driven values inherent in capitalist systems.This paper will argue that contrary to popular belief, the Islamic business model does not prohibit the making of profit, or competition or the accumulation of wealth. But it goes further to provide a moral filter through which business ought to be conducted. Thus Islamic business requirements ought not to be perceived as those which prohibit the creation or accumulation of wealth. Rather, we should seek to achieve a deeper appreciation of the rationale behind the Islamic business model - i.e. to promote honesty, accountability and the creation of a fair society whilst denouncing exploitation, abuse of position and an alienation of the poor and underprivileged." ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]
- Published
- 2008