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Conflict of Interest


Assalma aliakum .

I got your contact from a dear friend of mine. I am in dilemma and could really use your help if you answer my question.

So, I work in a company which is internationally operational in the construction business. Its regional branch is in Bahrain for the middle east section. We have a regional manager responsible for the business in this area (He is not the owner of the company) but may hold a small share.  In our profession, we outsource works and buy a lot of material from other traders and contractors.

The nature of this company is OK and it has many partners. Your head is a small share partner which is OK and as an employee or partner, you are purchasing material which is right OK. The nature of this company is Halal.

If I retain my job in this company and open another company wherein, I outsource works or buy materials through my newly founded company with the permission of my regional manager and legal registration in our country, will the profits earned be halal or haram?


Yes, it is Halal as your company. During buying or purchasing is Halal and you outsource it due to legal constrant. It is OK and according to the Quran and Sunnah, it is Halal. According to Shri’ah, the Haram is any thing when we misuse or illegal fund of other persons because it is expolitation. If you don’t do it in any explolitation of other persons, then all the transactions are Halal.


The catch here is that my regional manager cannot communicate this to the head office or the owner and will act solely on his authority in managing the local works. He will also be a share holder in this new company so his decisions could be in favor of the new company and ultimately reduce profits for the head office. But by doing this he is ensuring that his best employees do not leave their jobs and keep working with him.


In this situation, a sort of expolitation can be done. But if the owner, has given all the authority to the Regional Manager and he informed the onwer that he hold a new company and he is purchasing / selling products of new company and the owner agreed with it, then there is no expolitation so it is Halal.

But if such situation is not informed to the owners, then it will be supecision activity which may be misuse and exploitation about the parent company and their owners. In such scenario, it may be Haram or Halal in different transactions. Therefore, the Regional Manager should explain all the situation to the owners of the parent company so that they will give authority or not.


The question is that even though I have taken the regional manager’s permission, the truth is hidden from the owner so will that make my earnings haram if I proceed with this plan?


Such suspicion transactions may be Halal or Haram and such responsibility about the Regional Manager. You are employee or the Regional Manager. To avoid any Haram activity, you should give suggestion to the Regional Manager to give transparent information to the onwers. If he do it and they give authority, then it is OK and Halal. Otherwise, if the owners disagree and they don’t give authority to the Regional Manager, then his transactions will be illegal and Haram.

For your responsibility, you should check a sample of transactions and confirm that the Regional Manager ask you to do legal Halal activities, then your job will be OK and Halal. If the Manager ask you to conduct some illegal suspecious activities which is unauthority of the Regional manager, then you should try to get some other job and get rid of such Haram activities. After getting some other job, then it will be easy for you to give all such information of unauthorized transactions to the owners to give help them.

Please let me know what you think and if you have any more questions please ask.Most welcome all the time. In future, whatever questions appear in your mind, feel free to send to me. If some transactions are authorized for the Regional Manager, then it is OK and Halal. If some transactions are unauthorized for him, then it is Haram. If you find some transactions, which are suspecion, you can provide me the details and as an “Auditor” I can advice you whether is it Halal / Haram. If you need Urdu, then please see my books and lectures on the topic of business transactions in Al-Fiqh. Otherwise, you can see my lecture in English about audit.

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