Doing Responsible Business in Iran: What do Iranians expect?

As European companies look to invest in Iran, they will have to comply with recent legislation on responsible business such as the French law on the duty of vigilance or the UK Modern Slavery Act. They will also have to live up to the expectations of international standards on responsible business such as the OECD Guidelines for Multinational Enterprises that apply everywhere an OECD headquartered company operates, or the IFC Performance Standards if they look for financial support from export credit agencies and even commercial banks. But is the pressure on companies to act responsibly in Iran only based on international standards? Or do Iranians themselves expect companies to act responsibly when operating in Iran?

To gain rigorous insights into this question, the Iran Business Responsibility project (IBR) carried out a groundbreaking poll inside Iran to measure the attitudes of urban Iranians toward responsible business issues. The poll was conducted via telephone interviews with 1,004 Iranians living in urban settings across the country in November 2017.

The results are significant: Iranians are deeply concerned about the impact of business on people and the environment and believe companies have a responsibility to ensure both are respected in the context of their activities.

The results show not only that a large majority of Iranians are familiar with the term "responsible business" but that they associate the term with many of the same issues that are reflected in international standards on responsible business. For example, a large percentage of Iranians feel strongly that companies are responsible for respecting the environment, ensuring occupational health and safety and respecting workers’ rights. They also believe companies are responsible for respecting communities that may be impacted by business activities and for respecting consumer rights.

The poll also showed that Iranians consider the reputation of the company and the absence of harassment in the workplace among the most important factors when considering employment - after such fundamental factors as salary and liking the job.

When asked about non-discrimination in access to employment, Iranian respondents showed active agreement with the idea that companies should ensure people with disabilities do not suffer discrimination in the workplace. On the other hand, the poll highlights areas where European companies may face challenges when implementing other types of non-discrimination policies, such as those concerning gender, religion and national origin.

The poll also indicates that perceptions on how European and Iranian companies compare on responsible business performance present a challenge for European companies. When asked to compare Iranian state-owned companies, European companies and Iranian private companies on key responsible business issues such as ensuring non-harassment at work, occupational health and safety, respecting the environment and considering the public interest when making business decisions, Iranian state-owned companies ranked far and away higher than European companies. This demonstrates that European companies will have to prove themselves in terms of acting responsibly and could gain a competitive advantage in Iran by doing so.

In sum, this first of its kind poll confirms that Iranians have strong expectations of companies to respect people and the environment. This means that as European companies look to comply with responsible business legislation and international standards in Iran they will also be responding to local expectations.