Licence to Operate in the Halal Market: A Matter of Alignment

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Marco Tieman

Abstract

The Middle East and Southeast Asia are amongst today’s leading consumer markets for food, cosmetics and pharmaceuticals. All major brand owners want to serve these Muslim markets. However, Muslim markets have stringent requirements regarding halal, demanding not only halal compliance for ingredients and production, but increasingly for the end-to-end supply and value chains. When doing business in Muslim markets, corporate halal reputation is therefore an important strategic asset. A corporate halal reputation is the collective representation of a firm’s past actions and halal performance, including the firm’s future ability to meet halal requirements. Halal reputation is undoubtedly valuable for corporations, but at the same time an intangible asset. Although intangible, the corporate halal reputation is important to measure and track. Muslim societies are less prepared to tolerate risks (whether real or perceived), meaning Muslims want a near zerorisk halal environment.

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