Halal Business Corporate Social Responsibility

Topics: Business ethics, Business, Islam Pages: 11 (3637 words) Published: June 16, 2011
Halal Business Corporate Social Responsibility
Othman Ibrahim*, Siti Zakiah Melatu Samsi**, Muhamad Fazil Ahmad*** *University Teknologi Malaysia/Faculty of Computer Science and Information System, Johor, Malaysia. Email: othmanibrahim@utm.my **Multimedia University/Faculty of Business and Law, Melaka, Malaysia. Email: zakiah.melatu@mmu.edu.my ***Universiti Putra Malaysia/Faculty of Modern Languages & Communication, Selangor, Malaysia. Email: mfazil@fbmk.upm.edu.my
Abstract - Halal industry is growing in Malaysia and the government has done a lot of initiatives to nurture the industry. The awareness to get Halal status for the food products and premises also increase among the businesses as the enforcement efforts being done by authorized bodies and NGOs. However, as Halal from business point of view is a very profitable market locally and globally, many businesses might not aware that having a Halal certified business carries a very high responsibility towards Muslim consumers. The purposes of this paper are: (1) to see the concept of ethics in business from Islamic perspective and link it with Halal business and (2) to discuss the corporate social responsibility of Halal business towards Muslim consumers.

Keywords – Halal; Business ethics; Corporate Social Responsibility; CSR; CSR in Islamic Perspective

The Halal industry in Malaysia has a great potential to be one of the major contributors to the Malaysian economy. With the huge market segment locally and internationally, the involvement of businesses in Halal business are increasing from time to time. As Halal business especially food production and processing is based on the Islamic principles, the main objective of the existence of Halal food and products is to protect Muslim consumers from taking and using non-Halal products which might bring negative impacts to their lives. However, while the government, authorization bodies and NGOs are actively promoting Halal certification and Halal business, the number of unethical practice among businesses are also increasing. Businesses perceive that Halal is merely to get the certification, ensure that their product is labeled by Halal label which enable them to gain the market. The businesses do not really understand their responsibilities as producers and sellers of Halal products towards the Muslim consumers. In other industries, Corporate Social Responsibility (CSR) has been widely discussed and debated by academics, scholars, researchers as well practitioners. It is believe that, an organization or business should put CSR as part of their strategic planning so that their business will be socially involve with the society. In Halal business, the concept of CSR must be based on the Islamic business ethics which emphasize on the benefiting the humanity while maintaining God’s order (Ahmad, S.F., 1991). The concept of Islamic business ethics, CSR from Islamic perspective and how it can be implemented in Halal business will be discussed throughout this paper.

Halal is an Arabic term means permissible, allowed or lawful according to Islamic law (JAKIM). According to Trade Descriptions (Use of Expression "Halal") Order 1975, the term Halal when being used as a trade description of any food, it indicates that Muslims are permitted to consume the food and the food must be: a)Neither is nor consists of or contains any part or matter of an animal that a Muslim is prohibited by Hukum Syarak to consume or that has not been slaughtered in accordance with Hukum Syarak; b)Does not contain anything which is considered to be impure according to Hukum Syarak; c)Has not been prepared, processed or manufactured using any instrument that was not free from anything impure according to Hukum Syarak; and d)Has not in the course of preparation, processing or storage been in contact with or close proximity to any food that fails to satisfy paragraph (a), (b) or (c) or anything that is...

References: [1] Abagail McWilliams and Donald Siegel, “Corporate Social Responsibility: A Theory of the Firm Perspective”, The Academy of Management Review, Vol. 26, No. 1, pp. 117-127, 2001.
[2] Abeng, T., “Business ethics in Islamic context: Perspectives of a muslim business leader”, Business Ethics Quarterly. 7(3), 47-54, 1997.
[3] Ahmad, S.F., “The ethical responsibility of business: Islamic principles and implication”, Journal of Objective Studies. 3(1), 23-43, 1991.
[4] Amat, S., “Halal – new market opportunities”, The 9th Efficient Consumer Response (ECR) Conference. Kuala Lumpur Convention Centre (KLCC), Kuala Lumpur, Malaysia, 2006.
[6] Beekun, R.I., “Islamic business ethics”, Herndon, Virginia: The International Institute of Islamic Thought, 1996.
[7] Beekun, R.I., “Islamic business ethics”, Herndon, Virginia: The International Institute of Islamic Thought, 1997.
[8] Bukhari M. I. & Yusuf T. D, Imam Bukhari 's book of Muslim morals and manners. Al Saadawi Publications, 1997.
[9] Cole, B.C., & Smith, D.L., “Perceptions of business ethics: Students vs. business people”. Journal of Business Ethics, 15, 889–896, 1996.
[13] Karassavidou, E., & Glaveli, N., “Towards the ethical or the unethical side? An explorative research of Greek business students’ attitudes”. International Journal of Educational Management, 20, 348–364, 2006.
[15] Maulana Abul A’la Mawdudi, “Fundamentals of Islam” (English Translation of Khutubah) Revised Edition, Dar Al Wahi Publications, 2008.
[16] Mian N. Riaz & Muhammad M. Chaudry, Halal Food Production. 1st edn. Ohio: CRC Press, 2003.
[17] Muhamad, R., “Corporate social responsibility: An Islamic perspective”. International Conference on Global Research in Business and Economics Bangkok, Thailand, 2007.
[18] Nor Azman Ngah, “The national halal industry of halal value chain, Halal concept in livestock”. Workshop on Halal Awareness Programme at Impiana Hotel KLCC, on 25th June 2010, 2010.
[19] Parvez, Z., “Lack of business responsibility: an Islamic perspective”, International Journal of Business Governance and Ethics 3: 42-55, 2007.
[20] Portal Rasmi Halal Malaysia. Takrifan Halal. Jabatan Kemajuan Islam Malaysia (JAKIM). Retrieved June 30th, 2010, from
[21] Shaharuddin, A., “Islamic business ethics: A managerial perspective”, Proceedings of the Malaysian Finance Association 7th Annual Conference, Kuala Terengganu: UiTM, 2005
[22] Siddiqi, M., “Business Ethics in Islam”, Retrieved July 1st, 2010, from
http://www.islamicperspective.net/Pictures/Essay%20File/a6s2s2.pdf, 2007.
[23] Sayyid Muhammad Rizvi, “Business Ethics in Islam”, Islamic Insights, 30 March 2008 20:34, from http://www.islamicinsights.com/religion/clergy-corner/business-ethics-in-islam.html, 2008.
[24] Trade Descriptions (Use of Expression "Halal") Order, 1975. PU (A) 237/1975. (Resembles PU (A) 91/1975).
[25] Wong Li Za, “Malaysia: Halal benchmark”, 5th World Halal Forum 2010, from http://halalfocus.net/2010/06/28/malaysia-halal-benchmark/, 2010.
[26] Watt, W. Montgomery. Makka - The pre-Islamic and early Islamic periods. Encyclopaedia of Islam. Edited by: P. Bearman , Th. Bianquis , C.E. Bosworth , E. van Donzel and W.P. Heinrichs. Brill, 2008. Brill Online. 06 June 2008
[27] Yaakob C
[28] Yeh, C.Y.L., “A comparison of perceptions about business ethics in four countries”. The Journal of Psychology, 133, 641–655, 1999.
[29] Yusuf Ali, The Qur 'an: Text, Translation & Commentary. English text. Lahore: Amana Publications, 2004.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • The Business Case for Corporate Social Responsibility Research Paper
  • Corporate Social Responsibility Essay
  • Corporate Social Responsibility: Microsoft Research Paper
  • Corporate Social Responsibility and Business Essay
  • The Corporate Social Responsibility of a Business Essay
  • Corporate Social responsibility Essay
  • Corporate Social Responsibility Essay

Become a StudyMode Member

Sign Up - It's Free