Social Business: An Islamic Perspective

Abstract

Social business based on interest is characterized as a separate business concept dealing with creating sustainable value to the society tailored to address social problems designed for the underprivileged community out of the traditional profit or no-profit based business operating approach. However, religion base motivation behind social enterprise or social business may be an alternative that may contribute to building a sustainable society serving the underprivileged community aiding them eradicating the interest based social business.

The motives and mission of the social business ranges from micro to the hybrid or macro involvement integrating the conventional theories based on an interest based business model. Consequently, the current study finds that gap intending to fill it aiming to offer a social business idea addressing the social problems showing a business model in the light of the Islamic principles with an inclusion of empirical knowledge.

The present study is qualitative and an inclusive in nature based on the literature in order to meet the unmet demand of the social business following the principles of the Holy Quran with an analytical model attempting to induct an innovative approach following the scriptural theory. As interest charging, taking or activities relating to interest like official work or being a guarantor are prohibited in Islam, an alternative approach is required for some stakeholders interested in social business who would like to avoid interest related transactions.

Funding, investing and managing a social business in the light of the holy Quran can meet up such types of need the stakeholders perceive in their minds as a latent demand. Islamic social business is no more a dream but a reality. Malaysia and Indonesia have started such business with their own funding. In Bangladesh, Muslim aid is operating micro financing to abolish usury or interest based social business.

However, the present study will guide the existing Islamic social businesses as well as helping emergence of new types with the contribution in social business literature for the academics as well.