The development of the Iraq Stock Exchange (ISX) is being held back by a culture of disregard. Over the past month, Warka Bank for Investment & Development, one of the largest private banks has been delisted from the exchange for failing to raise the required ID100bn ($85m) capital as set out by the Central Bank.

Twenty-three other companies on the ISX have been suspended from trading for failing to provide financial results on time.

The main problems that plague the exchange are visible throughout the different sectors in Iraq. It is a frontier market with its institutions still struggling to operate in a new democracy. Corruption and a lack of regard for rules are evident throughout and were the key reasons for the suspension of the companies listed.

The disregard for deadlines is doing little to boost the markets. The telecoms operators were aware of the terms of the licences when they purchased them four years ago and yet preparations for the initial public offerings started only a few months ago.

These are setbacks for the ISX, which has been working hard to increase investment into the country. Yet it should receive credit for its hardline stance. Punishing companies that refuse to abide by the rules is the first step towards modernising practices and steering away from corruption.