Business Ethics of the Islamic Financial Institutions in Pakistan; Theory, Practice and The way forward for Sustainable Development

Abstract

Purpose: This research study aims at the identification of loopholes in
the business ethical framework of Islamic Financial Institutions (IFIs) in
Pakistan.
Methodology: The researchers analysed the business ethics of IFIs in
Pakistan with the help of Global Reporting Initiative (GRI) Sustainability
Reporting Standards and Islamic Business Ethics.
Findings: Our analysis indicates that IFIs do not seem to follow the ethical
principles of Islam in true spirit for their business ethical framework.
Among all IFIs in Pakistan, takaful ¯ companies are overall best performers
in GRI Sustainability Reporting Standards. Similarly, full-fledged Islamic
banks and Islamic banking windows of conventional banks are the best
performers in applying or disclosing Islamic Business Ethics in their
annual reports.
Originality/Significance: This may be perhaps the first paper which
explores the business ethics of IFIs in Pakistan w.r.t to GRI standards and
Islamic Business Ethics.
Research Limitations/Implications: The paper focuses only on annual
reports of IFIs for five years.
Practical and Social Implications: This paper can provide food for
thought to rethink the process of the current business ethical framework
of IFIs in Pakistan. Furthermore, it suggests some practical ways for
achieving higher levels of sustainable social, economic and environmental
development of the country.