* Foreign firms seek Iranian executives to crack the market
* Conglomerates want foreign-educated Farsi speakers, expertise
* Many Iranians abroad wary of returning to the Islamic Republic
By Pamela Barbaglia
LONDON, March 29 (Reuters) - International firms are hunting for Western-educated Iranians to take on executive jobs in the Islamic Republic after the removal of most sanctions, but are finding it hard to win them over.
Interviews with Western companies and headhunters as well as more than 20 Iranians living abroad showed that expatriates are waiting to see how promised reforms progress before deciding whether to go back, despite lucrative job offers.
Many in the diaspora are put off by the poor quality of life and problems such as red tape, a murky business culture, security issues, pollution and a lack of international schools for their children. They are also concerned about their rights and protections under the Islamic Republic's judicial system.
Their reluctance is making life harder for conglomerates who need help to navigate Iran's complex business world, train the local workforce and bridge a cultural and linguistic gap with affluent local consumers in the country of 80 million.
"This is the place where an expat who holds an MBA (Master of Business Administration) and has the right entrepreneurial attitude can make a real impact. Yet there's never been a queue of expats applying for jobs here," Giuseppe Carella, the Iran country chief of Swiss food group Nestlé, told Reuters.
To nurture future managers, Nestlé sends local graduates overseas for several years, honing their skills away from Iran until they're ready to go back, Carella said.
Expats remain a tiny minority of the about 1,000 employees at the firm's subsidiary in Iran, 15 years after its launch.
President Hassan Rouhani met Iranian expatriates in New York last September and urged them to re-engage with Iran, weeks after Tehran agreed to curb its nuclear programme in exchange for the lifting of nuclear-related sanctions.
During a visit to Singapore this month, Foreign Minister Mohammad Javad Zarif said Iranian nationals living abroad were "the best bridges for dialogue of cultures and civilizations".
The Iranian diaspora is estimated by Iranian officials at between 5 and 7 million people, mostly living in North America, Europe and the Gulf.
Some, like Paniz Golkar, a 26-year-old dual national of Iran and Canada, are tempted to return.
"I feel it's my responsibility to go back. Iran needs professionals from all fields," said Golkar, who is due to finish her studies at the Southern California Institute of Architecture in April. "It will be challenging to prove myself as a woman in business but there are more career opportunities in Iran than anywhere else.
"A lot of Iranians in California are talking about moving back, it's an option we can't ignore," she said.
But there are many challenges to consider.
Some expatriates whose families left Iran before or soon after the 1979 revolution are skeptical about career prospects and worry that Tehran's refusal to recognise their dual citizenship status makes them vulnerable to arbitrary arrest.
Security forces have arrested some dual nationals who hold U.S. and European passports in recent years on unspecified national security charges.
Others hesitate because of concerns over the bureaucratic regime, the lower standard of living in traffic-clogged Tehran and restrictions enforced by the "morality police" on Islamic dress and behaviour codes.
British-Iranian Ali Tehrani, 24, tried to relocate to Iran last October but was worn down by the challenge of securing permits and licenses and an exemption from military service, which in Iran is compulsory and lasts 24 months.
"I quickly realised I didn't have the skill sets to navigate the bureaucracy in Iran," he said.
A graduate of University College London who founded a human resources tech firm, KeyPursuit.com, he had hoped to launch an Internet start-up in Iran focusing on online payments. He abandoned the project after three months.
A 2016 survey of 230 cities by consultant Mercer ranked Tehran 203rd for quality of living, worse than Pakistan's Islamabad and Kenya's Nairobi.
Home to around 14 million people, Tehran's metropolitan area is often blanketed in smog and schools are frequently shut because air pollution keeps reaching alarming levels.
Several Iranians based in the Gulf told Reuters that Western firms wanted to recruit them as they don't trust the local workforce because of concerns about corruption and breaches of security and intellectual property rights.
"Loyalty remains one of the main issues when it comes to local staff," said a Tehran-based management consultant who requested anonymity. "Compensation is so low that people tend to have two or three different jobs, without any serious full-time commitment."
Iran ranked 130th out of 168 countries on Transparency International's 2015 Corruption Perceptions Index.
After watching many swings of the political pendulum in recent years, Iranians abroad also worry that the economic reforms led by President Rouhani may ultimately be blocked.
Rouhani wants to modernise the economy with the help of foreign investment and wealthy rich expats owning assets worth an estimated $2 trillion. Gains by allies in parliamentary elections are expected to help him push through the reforms.
But hardline allies of Supreme Leader Ayatollah Ali Khamenei said this month that Western business delegations have failed to deliver any benefit to Iran's economy.
COMPETITION TO WOO DIASPORA
Aware of expats' reservations, foreign firms are trying to woo Western residents with packages that can include high pay, family expenses and private school fees, and are billed as offering a faster career path than in the West.
A Western-educated Iranian can earn in excess of $15,000 a month, up to about $250,000 a year, in a senior executive role at a Western conglomerate in Iran, several headhunters and executives told Reuters.
For the same job at an Iranian firm, they said, locals would earn around $5,000 a month, up to about $100,000 a year.
This compares to a minimum monthly wage for local workers of $225, according to a 2015 study by Tehran-based consultancy REF Group.
Former science and technology minister Reza Faraji Dana said in 2014 about 150,000 of Iran's "highly talented people" were leaving annually, costing the economy as much as $150 billion a year.
"For years Iran has had a brain-drain problem. Now people holding a Western degree can get high-profile jobs and move up through the ranks (in Iran) at a much faster pace than anywhere else," said Sarmad Afarinesh, an Austrian-educated Iranian whose Vienna-based company, Arhax Consulting, helps multinational firms enter Iran.
Consultants who cater to Western conglomerates seeking access to Iran -- one business that is growing fast across all sectors -- can earn up to $10,000 a month without relocating permanently, headhunters say.
Reza Joorabchi, a 35-year-old Iranian-Canadian who left Iran at the age of six months, moved back to Tehran in November to help Western firms crack the market.
"Everybody is surprised that I've lasted for more than two months. The quality of living is so poor that many expats give up almost immediately," he said. "You need to have a thick skin to survive."
Joorabchi said foreign companies must now distinguish between expats willing to live in Iran and those who are ready only to travel there.
Many executives prefer to be based in Dubai where international companies have their Middle East headquarters.
Dubai-based executive search firm Wise&Miller, which has placed senior managers at international companies such as Royal Dutch Shell, Unilever Plc, Heineken and Philips in the Middle East, is building a database of foreign-educated Iranians willing to relocate.
It is "an increasingly crowded market," according to the company's co-founder, Marc Mulder, who says he approaches dozens of candidates each week using social media to establish a connection with Iranian professionals around the world.
Hamid Biglari, a former Citigroup vice-chairman and financier with emerging market expertise now also advising investors on Iran, said the country needs to come up with incentives for people of Iranian origin to come back, such as issuing identification cards that would allow them to travel to and invest in Iran without a visa or dual citizenship.
"More needs to be done to persuade the Iranian diaspora to re-engage with their land of origin," said Biglari, who left Iran in 1977.
Their role could be similar to that of Indian expatriates in the United States who helped make India a global technology powerhouse, he said.
"Iranians abroad can provide capital, knowledge and business connections, all of which are vital to rebuild the country." (Additional reporting by Sam Wilkin in Dubai, editing by Sinead Cruise, Timothy Heritage and Sonya Hepinstall)