Is it unethical to do business?
The US bankers have not only stalled the global flow of money with their bad credit schemes. They also ensured that the reputation of banks in general was badly damaged. The confidence of many investors is permanently disrupted.
Moral principles seem to have been lost to many bankers. There is hardly any other explanation for the fact that old people were sold securities with extremely long terms. There can be no question of responsible advice here. Such unscrupulous businesses are the excesses of an inhumane financial system.
Alternatives in the Islamic World
Since the 1970s, a financial system has developed in the Islamic world that tries to curb human greed. In so-called "Islamic Banking", the Sharia dictates which financial transactions are allowed and which are not.
In the Koran there are a number of prohibitions that also apply to the work of Islamic banks today. After that, the Prophet Mohammed forbade earning money with money - that is, charging interest. That was originally the case in Judaism and Christianity.
Over the centuries - at the latest since the Enlightenment - the interest prohibition was weakened more and more. Furthermore, believing Muslims are not allowed to sell something that they do not actually own and that does not yet exist. So only real products can be traded.
This definitely does not include derivatives - futures transactions whose price or occurrence is still uncertain. Because these highly speculative businesses have a lot in common with gambling or betting. Both are forbidden in Islam. Investing in companies that deal with alcohol, pork, or pornography is also taboo.
Shared risk - shared profit
If a customer wants to buy a house according to Islamic law, he does not go to the bank, takes out a loan and pays it back. It is the bank that buys the house only to eventually sell it on to the customer at a premium.
The bank pays very close attention to whether the future owner is financially able to do so. Because with Islamic banking, both sides share the risk, but also the profit of a business. That is why companies that seek investment support from the bank must also have sufficient equity capital. At 30 percent, this security is considerably higher than in western finance.
It is precisely these and other rules of responsibility that have not drawn the Islamic world of money into the maelstrom of the Western financial crisis, some say. However, critics believe that Islamic banks have not been spared either. They had only been financially supported by their powerful governments.
They also have doubts that Islamic banks really operate exclusively according to Sharia law. Often enough, lucrative businesses would like to wear the cloak of Sharia law in order to present them to believing customers as morally impeccable.
Despite the - perhaps justified - objections, Islamic banking has some principles in store that would be good for Western banking. The business with money would become more controllable and morally justifiable.
Doing good with money
So-called alternative banks are pursuing a similar approach. They subordinate their business to sustainability and compatibility with people and the environment. Customers can set up current and overnight accounts at institutes such as the Ethikbank, Umweltbank or GLS Bank.
This is no different from conventional banks. But certainly when it comes to managing securities. The alternative banks advise their customers to only invest in companies that match their socio-ecological investment philosophy.
The Umweltbank takes it most precisely: there are no securities here that have a questionable background. These include, for example, shares in companies that disregard human rights or that pollute the environment.
Securities from the arms and nuclear industries are also on the "black list". The motivation behind this is not to financially support any company or project that harms society or nature. The money should be invested responsibly and sustainably - for example in social institutions or environmental projects.
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