The Untapped Potential: How Family Businesses Can Drive Iran’s Seventh Development Plan

As a Member of the Joint Commission of the Family Business Promotion Association and the Iran Federation of Management Consultants, I believe that the role of family businesses (FBs) in achieving the ambitious goals of Iran’s Seventh Development Plan has been largely overlooked. While much of the focus has been on large-scale investments and government-led initiatives, FBs can significantly contribute to the nation’s economic growth and productivity targets with their unique strengths and untapped potential. By leveraging domestic and international resources, these businesses could become vital drivers of sustainable development in Iran.

Family Business Capital: A Hidden Asset for National Development

Family businesses often possess untapped financial reserves, both within Iran and abroad. These reserves, along with their international familial networks, position FBs as critical sources of investment that could be leveraged to fill gaps in the country’s economic needs.

For instance, according to the Seventh Development Plan, Iran aims to achieve an 8% annual GDP growth rate, with 5.2% coming from increased investments and the remaining 2.8% from productivity improvements. Given their higher efficiency compared to non-private sectors, family businesses could significantly contribute to this productivity target. However, questions remain: Are the current economic and political conditions conducive to this? What incentives could encourage these families to invest their wealth back into Iran?

A Model for Engagement: Family Business as a Catalyst for Productivity

To better understand how family businesses can help, let’s propose a “Three Pillars Model for FB Engagement”—focusing on three critical areas where family businesses can make a difference:

1. Domestic and International Capital: Family businesses often have strong ties to international markets and diaspora communities. Their access to foreign reserves and an inherent trust in family networks position them as prime candidates for directing foreign capital into domestic projects. If properly incentivized, FBs could bridge the investment gap, bringing much-needed funds into Iran’s infrastructure and innovation sectors.
2. Higher Productivity through Family Networks: One key advantage of FBs is their ability to operate efficiently due to their tightly knit family structure. Unlike large bureaucratic organizations, FBs are more agile, adaptable, and focused on long-term growth, which naturally enhances productivity. As the Seventh Development Plan targets 35% of total economic growth from productivity, FBs, with their inherent flexibility and drive for long-term success, could play a pivotal role in achieving this.
3. Intergenerational Commitment to Sustainable Growth: Unlike many publicly traded companies focusing on quarterly profits, family businesses have a long-term view of success. This long-term approach aligns well with the sustainability and growth objectives of the Seventh Development Plan. FBs are more likely to invest in green technologies, education, and sustainable industries that benefit the current generation and set a solid foundation for future growth.

Unlocking the Potential: Policy and Strategic Support for Family Businesses

For FBs to fully contribute to the nation’s development goals, policymakers must create a favorable environment that fosters trust and incentivizes investment. This includes:

• We are facilitating capital inflows by easing restrictions on foreign exchange and offering tax incentives for family businesses investing in critical sectors.
• They are streamlining bureaucracy to allow family businesses more autonomy and flexibility.
• It supports innovation and sustainability initiatives that align with the Seventh Development Plan’s focus on modernizing Iran’s industries and infrastructure.

A Win-Win for the Nation and Family Businesses

By embracing the potential of family businesses, Iran could not only bridge the investment gap but also achieve greater productivity and sustainable growth. The collaboration between government bodies and FBs could pave the way for a more resilient economy, one that is built on the strengths of private-sector agility and long-term familial commitments.

The Seventh Development Plan is an ambitious blueprint for Iran’s future. To bring this vision to life, it’s time to recognize and leverage the pivotal role of family businesses in shaping a brighter economic future.