By Aprilia Natasya
When we hear the word halal, many people may only think about whether a product or service complies with Shariah principles. But is it enough to stop there? In a fast-growing world, adhering to halal values should be the start of something bigger, not just a label that meets the bare minimum requirements.
Islam teaches that halal is not just about what is consumed but also how a product or service is produced. Thayyib, which means good, goes beyond that. Does the supply chain respect workers? Is the impact on the environment taken into account? For example, in the halal food industry, the focus is often only on ingredients, such as not containing pork or alcohol. But what about the environmental sustainability of the production? Or the working conditions of the labourers? This principle adjusts with Islam’s goal of bringing maslahat (rahmatan lil’ alamin), which includes social justice and sustainability—not just for humankind.
Halal products are defined as those meeting Shariah requirements and ensuring the fulfilment of both the ingredients used and the processes followed (Burhanuddin, 2011). Increased awareness of halal principles enhances consumer trust and supports higher purchase targets by aligning ethical and spiritual values with consumption patterns (Nurhasanah & Hariyani, 2017; Bashir et al., 2019). It is intriguing to explore how understanding halal principles influences market dynamics in the context of most of the Muslim population.
According to Nielsen’s 2023, around 68% of Indonesian consumers consider ESG factors when purchasing. This preference includes environmentally friendly products, support for labour rights, and transparency in corporate governance. Such a trend is both a challenge and an opportunity for Muslim entrepreneurs. It is no longer enough to be only labelled halal; products, services, and innovations must reflect universal values such as transparency, sustainability, and fairness.
An Indonesian halal cosmetics brand, Wardah, exemplifies success in the global market by adopting an inclusive approach that appeals to both Muslim consumers and sustainability-conscious individuals. Recognized as a pioneer in halal cosmetics since 1999, Wardah has expanded to markets such as Malaysia, Singapore, the UAE (11% of exports), and Japan (7.28%) (Katadata, 2020).
Wardah’s commitment to sustainability is evident in its practices. The company carefully sources raw materials from responsible and sustainable suppliers, ensuring environmental friendliness. Wardah implements the Sustainable Manufacturing Concept to enhance efficiency during manufacturing. By collaborating with Waste 4 Change, Wardah recycles old packaging materials, such as unused bottles, into reusable products. These efforts reflect the concept of halal+ or halal and thayyib (halal products with added value), demonstrating how halal principles, combined with sustainability, can attract a diverse audience and enhance competitiveness in the global market.
The Quran often emphasizes the importance of impactful, everlasting, and righteous deeds (al-baqiyat al-salihat). In the business context, this means creating profitable ventures that provide a lasting positive impact. The Prophet Muhammad is a perfect example of an entrepreneur who integrated ethics into business practices, ensuring transaction fairness and product quality.
He strictly prohibited cheating and fraud in economic transactions, as conveyed through a hadith narrated by Muslim that tells the story of market inspection. In the hadith, the Prophet saw a pile of food sold by a merchant. When he put his hand into the pile of food, the Prophet found that the inside was wet. The Prophet asked the merchant, “What is this, O owner of the food?” The merchant replied that the food had been exposed to rainwater. The Prophet said, “Why don’t you put it on top so that people can see it? Be aware that whoever cheats is not of my group.”
In the modern world, this can be translated as the courage to innovate while remaining ethical. For example, the halal food industry can contribute to sustainability by supporting organic farming, reducing food waste, or using renewable energy in its production process.
People, especially Muslims, must understand that the concept of halal has the potential to go beyond the general definition of halal. In the digital era, the role of Muslim entrepreneurs is becoming increasingly relevant to address social and environmental challenges. Halal is no longer just about compliance but reflects a broader responsibility towards society and the environment.
Phenomena such as climate change and social inequality show that businesses that only focus on profits are no longer enough. Businesses that emphasize sustainability and social responsibility have the opportunity to reach a broader range of consumers. In this context, Muslim entrepreneurs have the chance to lead the change by integrating Islamic values that emphasize ecological balance and justice in their business practices.
For example, Muslim entrepreneurs in the renewable energy sector can develop and promote affordable solar panel systems for rural communities. This approach addresses the need for clean energy to combat climate change and aligns with the Islamic principle of preserving the environment and ensuring equitable access to resources. In addition, sustainability should also include worker welfare.
Fair labour practices increase productivity by strengthening a harmonious and conducive work environment where employees feel valued and motivated. For example, providing fair wages and safe working conditions reduces turnover rates and heightens employee loyalty. As the Prophet Muhammad said, narrated by Ibn Majah, “Give a worker his wages before his sweat is dry.”
Those practices strengthen long-term business alliances by building credence and acceptance between employers, employees, and stakeholders. This aligns with Islamic principles of justice, which advocate for fair treatment and the protection of the rights of all individuals involved in business operations. By establishing fairness, businesses obey ethical standards and create a long-lasting and harmonious adapting workplace.
Imagine how this approach could be applied in real life. A halal business that uses renewable energy in its production guarantees a living wage for its workers and contributes to the empowerment of local communities. It’s about fulfilling the halal-certified measure and creating meaningful and sustainable change. An approach like this will provide a more significant impact and inspiration for other entrepreneurs.
In this complex world, being halal is not enough. Muslim entrepreneurs must take it a step further by integrating the values of sustainability, innovation, and inclusivity. Only then can we present Islam as a solution, not just for Muslims but for the world as a whole. Just like experts say, “Halal is not only a license, but also a responsibility.” Let us redefine the meaning of halal in entrepreneurship, making it a path to meaningful and impactful transformation.
About the Author
Aprilia Natasya is an international management student at the Islamic University of Indonesia (UII) and an awardee of Beasiswa Unggulan. She is actively involved in the UII community program, emphasising Islamic character-building, leadership, and academic excellence. Passionate about ethical business practices and market transformation, she seeks to inspire meaningful change among Muslim entrepreneurs through her insights and dedication to impactful initiatives.
References
- Bashir, AM. 2019. Pengaruh kesadaran halal, logo halal dan sikap terhadap niat pembelian konsumen asing. British Food Journal, Vol. 121 No. 9, hlm. 1998-2015.
- Burhanuddin. 2011. Pemikiran hukum perlindungan konsumen dan sertifikasi halal. UIN-Maliki Press, Malang.
- Katadata. 2020. Bidik Pasar Kosmetik Halal, Wardah Ekspor Rp 22 Miliar ke Malaysia.
- Neilsen. 2023. Konsumen Indonesia Lebih Memilih Produk dari Perusahaan Berkelanjutan.
- Nurhasanah, S., & Hariyani, H. F. 2018. Halal Purchase Intention on Processed Food. Tazkia Islamic Finance and Business Review, 11 (2).
