Jessica Sarhan
Last updated: 17 September, 2012

The Importance of CSR for Foreign Investors in Iraq

Corporate Social Responsibility (CSR) has long been under question with international businesses and markets moving into Iraq. Despite the region being plagued by war and instability for a considerable period, foreign investments have continued to grow in the region and businesses across the globe are eager to be part of Iraq’s economic development.

The Rt. Hon Lord Howell of Guildford, minister of state at the Foreign Commonwealth Office explained at a conference entitled Iraq: untapped business opportunities, hosted by the Middle East Association (MEA), that “UK companies are looking to work with, and help build a successful private sector in Iraq…We will stand with Iraq and offer support as private businesses will do as well.”

Whilst business opportunities in Iraq lie mostly in the oil and gas industries, the event highlighted the need for a variety of sectors; including education and health, to be implemented into the region. An area that was discussed at length during the event was British and foreign companies’ Corporate Social Responsibility in the region and how the people of Iraq need to be put at the forefront of any significant decisions being made in the country. A representative of Shell explained that during their extensive work in Iraq, the company has offered, and continues to offer, numerous scholarships to students wanting to study engineering. They also have provided in-depth training and job opportunities to local communities in the areas that they work in.

Other companies shared similar sentiments, and were keen to show that education and employment opportunities were vital in maintaining good relationships with the Iraqi people. Several business executives agreed that companies need to engage with the population. Hiring locals is perhaps the best way to do so.

“Being present on the ground, and hiring locally where possible is immensely important…One becomes better informed and can develop strong local relationship. Since 2004, the single most important thing I have done by being in Iraq is creating lasting relationships with Iraqis”, said William Wakeham, CEO, AAIB Insurance Brokers.

This creates a win-win situation; Iraqis get a chance to go to work and contribute to the development of their societies whereas foreign corporations invest in education and training for the local workforce, which in the end gives them access to skilled labour. Equally important is brand building, and as the Iraqi public becomes increasingly aware of the presence of foreign companies, corporate social responsibility is a concept that cannot be neglected. 

However, what seemed lacking from many companies at the event was the limited number of opportunities available for women in Iraq. Iraq is making vast strides in its economic development and it is pivotal that Iraqi women can be part of this evolvement.

However, positive developments have been made. For example, October 2011 saw the launch of a UN Global Compact in Iraq by the United Nations Development Programme and the Iraqi Council of Ministers Secretariat. The event was a huge success and saw business professionals and civil society members discuss the importance of Corporate Social Responsibility and the importance of engaging all members of the Iraqi community.

However, what remains a vital question is Iraq’s stability and this will play a huge factor in foreign businesses’ decision to invest in the region.

CNN recently reported on the statements of Iraqi Vice President Tariq al-Hashimi, who has said that violence could soon return to the country. He expressed his anger towards Iraqi Prime Minister, Nuri al-Maliki, by saying: “Al-Maliki is pushing my country to reach a turning point with deeply sectarian dimension,” in an interview with CNN.

The hope is that Iraq may develop a genuine sense of stability, enabling individuals, communities and companies, within and outside of Iraq, to benefit from the opportunities that the region has to offer.