My reading material on a recent business trip included Building and Maintaining a Global Public Affairs Function, by the DC-based Foundation for Public Affairs. The Foundation for Public Affairs is the association for public affairs professionals that produces excellent publications.
The paper is a high-level discussion of best practices and the evolving structure of corporate government affairs on the global scale.
My trip last week included the last meeting with a global advocacy group I’ve had the pleasure to belong to for more than four years. The flavor and food ingredient industry has relatively little global government and public affairs capacity, but they’re effective at leveraging the resources that are in place and protecting their businesses in markets around the world.
This group, the International Organization of the Flavor Industry, brings together technical professionals from food ingredient companies representing just about every region of the developed world.
The playing field for global public relations has expanded and now includes all of the developed and developing world. The sooner you establish a presence in a country or region the better. Traditional strongholds like DC and Brussels are still important, but the action has shifted to emerging markets where companies are trying to get a first-mover advantage.
It is also true that companies take many different approaches to managing government and public affairs. In some companies and associations these functions are combined, in others they are separate which can create automatic internal communications challenges that inevitably hold the organization back. Initial challenges include defining exactly what we mean by government or public affairs. Say these terms and people hear different things.
The IOFI group met last week in Geneva, Switzerland. Over the years that I’ve been involved we’ve also met in Tokyo, Brussels, and New York. I’ve seen this team evolve from tentative and clumsy to a collaborative and fast-acting global advocacy team. Last week’s meeting included a group dinner at the Chateau de Divonne, (above), in France, just over the border from Geneva.
Over the years that I have been observing government relations the game has continuously evolved. The changes to global public affairs are now even more profound as the world has gotten smaller and more connected.
Here are what I see at the most basic elements of a global government affairs program:
Understanding the Business
Just getting a handle on all the various business units, products or services in a large company or industry can be a challenge. Strategic GR practitioners find the right balance between spending time in the business learning about it, and facing the external world, to explain and protect it.
“Lobbying” used to be seen as somewhat mystical. By calling it “public affairs” or “advocacy” you remove some of the mystery, but you still have to establish relationships with the right policy makers at many levels of government. The adage about being nice to the boss’ secretary applies to government relations too; people up and down the chain of an agency can be helpful or create obstacles. My international colleagues have explained to me that there is no French word for “lobbying” and no Japanese term for “advocacy.”
Successful global government affairs requires the right combination of individual company representation and shared tactics through coalitions or associations. Associations are the most effective way for a company to shape public policy. However, this varies by region. For instance, in the U.S. and Europe governments encourage the business community to organize and speak with one voice when possible, but in Asia the association world doesn’t consistently play a role, at least not yet.
Culture and Secret Sauce
According to the Foundation for Public Affairs (FPA), “When multinationals are asked how they organize their global government relations function, there are nearly as many different answers as companies competing on the world stage.” Some companies have no resources dedicated to government relations, while others are fully engaged in partnering with governments.
Don’t forget that government relations really means human relations. When you add the international element to the game it makes it more complicated and more rewarding at the same time. I’ve gotten to know some smart and interesting people over some amazing meals.
The paper also includes some vivid anecdotes about the need to be aware of different cultures:
“In the U.S., we like people who get things done, are well-organized and are intolerant of ambiguity. Than kind of person could be a disaster in the Middle East, where meetings start late and relationships are so important.”
“In China, discussing business before having had two or three dinners together would constitute a faux pas.”
How does a company decide where to put GR resources? One company mentioned in the FPA report uses the Heritage Foundation’s Economic Freedom Index to decide which governments might potentially interfere with there business. This is a fascinating index that for 20 years has provided a snapshot of government conditions country by country. But I can’t figure out exactly how this information would be used when deploying government relations resources. For example, if your company has significant operations in Canada, where there is considerable economic freedom, and Venezuela, where conditions have been steadily decreasing, where is it more important to invest in government relations capacity? I guess the answer is Venezuela, but you shouldn’t neglect any markets where you have operations.
The bottom line is that modern global government relations is still evolving, but it has become more sophisticated and interesting than ever.