Musharakah - Business Secrecy

Another criticism against musharakah is that, by making the financier a partner in the business of the client, it may disclose the secrets of the business to the financier, and through him to other traders.

However, the solution to this problem is very easy. The client, while entering into the musharakah, may put a condition that the financier will not interfere with the management affairs, and he will not disclose any information about the business to any person without prior permission of the client. Such agreements of maintaining secrecy are always honoured by the prestigious institutions, especially by the banks and financial institutions whose entire business is based on confidentiality.

Source: Republished with the kind permission of Sheikh Muhammad Taqi Usmani.