On 29 June 2017 Andrea Saldarriaga, Visiting Fellow at the Lab, spoke on a panel at the OECD Global Forum on Responsible Business Conduct about how to ensure responsible infrastructure development in Iran. Saldarriaga explained that the Government of Iran has identified infrastructure as one of the key areas in which it is seeking foreign investment. The government has identified what it calls an ‘urgent need’ to upgrade the country’s airports, rails, power generation, and water management. This is seen as critical to the country’s economic growth, and, as Saldarriaga highlighted, the imperative of infrastructure investment is magnified because infrastructure shortcomings have created bottlenecks that are thought to be driving away foreign investment in other areas. Yet companies investing in Iran will face a number of complex challenges to responsible business.
While many are focused on sanctions, Saldarriaga highlighted risks that are receiving less attention but that are fundamental for people’s dignity and the viability of business ventures in infrastructure. These risks include, for example, the weak standards on occupational health and safety, where the rate of death from workplace injury in Iran is eight times the international average. Sixty percent of these deaths occur in the construction sector. There are also a number of risks related to the vulnerability of workers in infrastructure development in a country where 1/3 of the workforce is in the informal economy – with no social security or protection – and around 90% of the formal workforce is on temporary contracts where labour protections are weakly enforced.
Saldarriaga called on investors in infrastructure to pay special attention to the welfare of workers in their operations and those of their business partners and suppliers of products and services. She also called on mulitlateral organisations, such as the OECD, to spearhead discussions on responsible business conduct in Iran emphasising that the challenges to responsible business are great, and that there is a need for collective action to ensure investors have the appropriate information and incentives to perform responsibly in the country.
The panel discussion on infrastructure was one focus of the Global Forum this year held at the OECD on 29 and 30 June 2017. A video of the panel discussion can be found here at 1:56.
