Risk studies have primarily focused on political risks, frequently overlooking the critical effect of social variables on investment sustainability.

Focusing on adjusting to local culture is essential not sufficient for successful integration. Integration is a loosely defined concept involving several things, such as for example appreciating local values, understanding decision-making styles beyond a limited transactional business viewpoint, and looking at societal norms that influence business practices. In GCC countries, effective business relationships are more than just transactional interactions. What impacts employee motivation and job satisfaction differ significantly across cultures. Hence, to seriously incorporate your business in the Middle East two things are needed. Firstly, a corporate mindset change in risk management beyond monetary risk management tools, as consultants and lawyers such as Salem Al Kait and Ammar Haykal in Ras Al Khaimah may likely recommend. Next, methods which can be effortlessly implemented on the ground to convert the new approach into practice.

Recent studies on risks linked to foreign direct investments in the MENA region offer fresh insights, attempting to bridge the gap in empirical knowledge regarding the risk perceptions and management strategies of Western multinational corporations active extensively in the area. For instance, a study involving a few major international companies in the GCC countries revealed some interesting findings. It argued that the risks associated with foreign investments are far more complex than just political or exchange rate risks. Cultural risks are regarded as more essential than governmental, monetary, or financial risks based on survey data . Moreover, the study found that while elements of Arab culture strongly influence the business environment, many foreign companies struggle to adapt to local customs and routines. This trouble in adapting is really a danger dimension that needs further investigation and a change in how multinational corporations run in the area.

Although governmental instability seems to take over news coverage on the Middle East, in recent times, the region—and particularly the Arabian Gulf—has seen a stable upsurge in international direct investment (FDI). The Middle East and Arab Gulf markets are becoming more and more attractive for FDI. But, the prevailing research on what multinational corporations perceive area specific risks is scarce and often does not have insights, an undeniable fact lawyers and danger professionals like Louise Flanagan in Ras Al Khaimah may likely be aware of. Studies on risks connected with FDI in the area tend to overstate and mostly pay attention to political risks, such as for example government uncertainty or policy changes that could influence investments. But lately research has started to shed a light on a a vital yet often overlooked aspect, namely the consequences of cultural factors regarding the sustainability of foreign investments in the Arab Gulf. Indeed, a number of studies expose that many businesses and their administration teams considerably undervalue the effect of cultural differences, due mainly to a lack of comprehension of these social variables.