The Role of Governmental Relations in the Future

During the last five years, we could see the development and consolidation of the discipline of Global Governmental Relations (GRR). Due to increased mutual transnational interdependencies and international networking effects, political and economic interests are often no longer limited to a single community, but they have to be looked upon with a global dimension. Domestic events like changes of government, coalition negotiations, reform projects or referendums often have immediate effects on the strategic political and economic room for maneuver in other states. These interdependencies need to be considered in the strategic positioning of almost any business that wants to successfully assert its interests on national and international level. Thus, GRR refers to the development, implementation and continuous coordination of a political strategy that is specifically oriented towards the challenges and opportunities of a global field of action and strives for the optimal positioning in an inter- and supranationally networked arena.

In general, GRR strategies are characterized by three core features:

  1. Strategic policy objectives are not limited to a single state but relate to several networked states for example EU members, G20 nations, …
  2. There is a complex interaction of national and/or regional teams implementing the strategy locally and in contact with local decision-makers and stakeholders.
  3. A central strategic control center is coordinating the work of the teams, controls the implementation of the strategy and ensures a cultural balance between the actors.

This means GRR strategies are more than the sum of individual national strategies but individually designed strategies that realize the company’s political interests across countries but through specific measures that are adapted to national or regional needs. They can only work if they are able to combine and integrate different contexts of cultural differences and political systems. Against this background, issues of compliance play a very important role, as companies need to take decisions in the context of different legal and ethical codices nationally and internationally.

How have the global political framework conditions changed?

The beginning of the 21st century is marked by changed global framework conditions that have effects on the strategic capability to act. Global challenges like the economic rise of China, the conflict between Russia and Ukraine and the strengthening and consolidation of authoritarian systems clearly illustrate the increased importance of geopolitics, i. e. the enforcement of national interests through power. The rising antagonism and system rivalry between Western liberal democracies and authoritarian regimes in the East are marking a turn away from multilateralism and towards bilateralism, as we are finding ourselves in a second cold war situation. These trends result in the political sphere of power prevailing over the economic sphere, creating a stronger need for Governmental and Public Affairs activities.

What does this mean for Global Public Affairs?

When we look at these new global political framework conditions, we can see them changing the work of Governmental and Public Affairs from an internal and an external dimension:

Internally, there is a growing professionalization of GR activities within companies that is taking place between centralization and decentralization processes and complex compliance challenges.

Externally, there is the requirement for Public Affairs to develop a credible narrative balancing between the company’s goal of making profit and the political and social demand of serving the common good. From this perspective, two important factors are influencing the work of GRR professionals:

  1. In their political communication strategy, companies must consider the higher density and complexity of topics reinforced and amplified by the power of social media. The significant role of social media as important Public Affairs tool and the trend towards “digital public affairs” are, however, both providing opportunities and risks.
  2. Against the rising importance of CSR and ESG, companies are under increasing pressure to position themselves on political and societal issues and are being held accountable for their social and environmental impact. The classic economic narrative of maximizing profit as main purpose of a company has become overhauled by an increased demand to contribute to sustainable development of society.

What are the implications for our work in GR and PA?

Now what do these changed framework conditions mean for the work of professionals working in GRR? To answer this question, we are applying the three guiding principles and aspects of the power leadership curriculum: empower, condense and influence.

Empower:

Governmental Relations professionals are functioning as mediators between the economic and the political spheres. As such, they need to translate economic interests into the language of politics and build bridges between business interests and the common good. Thus, strategic work is becoming more important than traditional lobbying based on a “contact book”. 

Condense:

The internationalization of business operations, global value chains and higher interconnectivity result in the internationalization of political processes and add a global perspective to national policies. Successful GR strategists must therefore understand and integrate different political logics and narratives into political lobbying work. Globalization forces PA actors to turn their eye not only to political developments in Brussels, but the entire world, as local, national or regional conflicts can have global political and economic consequences.

Furthermore, the detailed analysis and intelligent monitoring of political processes and global interdependencies as well as the managing of issues and messages gets more complex. Likewise, political lobbyists must develop new instruments of strategic navigation for business organizations. IT and AI can provide possibilities for reducing the complexity of political processes. If we succeed in integrating AI with learning systems in the foreseeable future, there will be great support potential for governmental relations.

Influence:

Upon the implementation of a GR strategy, the high significance of social media and the new field of “digital public affairs” should not be underestimated. Social media have become an important public affairs tool to reach relevant stakeholder groups and decision-makers. Digital natives are now an important group in parliaments worldwide and political debates are increasingly taking place on Twitter. While social media are a chance for more transparency, agenda setting and participation, they also bear risks for businesses for example shitstorms, reputational damages and in general blurring boundaries between information, PR and advertising.

It is also important to understand, that when turning a GR strategy into concrete lobbying measures, the focus should lie on creating trust, credibility and attention. The key to successful political lobbying today is the formation of strategic alliances and platforms that serve as interface in terms of content and organization. These platforms develop special credibility and effectiveness vis-à-vis political decision-makers as civil society actors can also dock onto such platforms and help spreading relevant messages in the political arena.

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