From his [= the Prophet’s ] time, democracy has consisted of a “shura” or council. With “shura”, people sit together, consult with one another and decide on one person to represent them. From the beginning, Islam has mandated democracy through a “shura”. The biggest evidence of democracy in Islam is what happened when the Prophet passed away without appointing anyone to succeed him. Sultans and kings appoint their elder sons as their successors, but the Prophet didn’t appoint anyone and left it for the Muslims to decide.
(www.livingislam.org / 19.11.2011)