According to the Holy Quran, Muslims need to be fair and honest and refrain from being unjust in any human matter (Quran 5:8, 3:161 Al-Bukhari 3: Hadith No 328). Business transactions fall under such human matters, and as such, all Muslims are expected to base all their business interactions and decisions on Islamic ethical codes without overlooking or ignoring the principles of Islam. Sharia law dictates that all business transactions and practices have to be reported and formalized. In addition, all parties to an agreement are expected to abide by it without deviating from the commitments they made in the contract (Cerimagic, 2010). The impact of this is that organizations operating under sharia law, be it domestic or foreign, cannot break any agreements they make since it is prohibited under sharia law, and as such, doing this gets perceived as a sin.
