Question

Arham has recently joined as a purchase manager at Cripple Technologies Company in Muscat, Sultanate of Oman. He got request from the various departments that they need additional computers. He analyzed all requirements and finally decided to place orders for 100 computers. Cripple Technologies Company has the bidding policy for selecting the best tender, where they take proposals from different computer suppliers. After analyzing all the proposal they finalize the deal. Arham's son (Jasem) works at Fiddley Computer Corporation in Muscat. Arham discussed the requirements with his son and asked him to submit the proposal to his company. Arham received two proposals; one from BMCT Computer Company and another from Fiddley Computer Corporation. Arham hides the BMCT Computer Company proposal in his old cupboards. As a purchase manager, Arham purchased computers directly from Fiddley Computer Corporation as there was no other competitor proposal. Arham purchased 100 computer for about 500 OMR each whereas BMCT Computer Company was selling for around 300 OMR. BMCT Company computers were better than the Fiddley in terms of features and the added benefit of after-sale service for 5 years. Jasem received a good commission on the sale of 100 computers from his company. Arham knew that, if the purchase order had gone through the normal bidding process, Fiddley Computer Corporation would not have been selected. Question 3 i. Do you think Arham did right action by hiding the BMCT Computer Company proposal in his cupboard? Justify your answer with valid reason. [2 Marks - Answer in 50-75 Words] ii. Do you think Arham's action for helping his son by placing the order and helping him in earning commission is correct? Justify your answer with 2 valid reasons. [4 Marks - Answer in 100-125 Words] iii. Is charging a high price for lower value good is right according to the Islamic religion? Justify your answer with reference to the ethical principles in business dealings based on Islamic values. [4 Marks - Answer in 100-125 Words]

Answer 1

Sol:

3.

i) Arham did the wrong thing by hiding the other proposal. He did that because his son was working in the company from which he bought the computers. His son got a hefty commission for the sale. He did that for his personal profit which is against every ethics.

ii) Arham's actions cannot be justified. He did the wrong thing by:

a) hiding the documents and misusing his authority as the Purchase Manager of the company and buying the computers from the company in which his son worked.

b) helping his son to earn undeserved commission for his own personal benefit.

iii) The ethical system in Islam is presented in light of Shariah – the Islamic social/legal system. According to Islam, whatever leads to welfare of the individual or society is morally good and whatever is injurious is morally bad. The ethical system prescribed in Islam is eternally divine and forms the foundation of an Islamic society. Islamic ethics prescribe its followers to zealously guard their behavior, words, thoughts, and intentions and observe certain norms and moral codes in their family affairs; in dealings with relatives, neighbors, and friends; in their business transactions; in their social affairs; and in private and public life. The unique feature of the Islamic ethical system is that it permeates all spheres and fields of human life. Islam also has its own distinctive value-based ethical system for business dealings. It prescribes certain specific guidelines governing business ethics, which are dictated primarily by the notion of halal (lawful or permitted) and haram (unlawful or prohibited) as per Islamic jurisprudence (fiqh). This chapter explores the ethical system in Islam, which is essentially a reflection of the divine commandments and guideline for the right and wrong and enumerates the general ethical rules of business conduct.

Islam says that we should be completely honest in our dealings and business and should never charge high price for low quality products. The Fidley computer corporation was not only selling low quality computers but was selling it at a much higher price than the BMCT company who were selling good quality computers at a lower and reasonable price.