Politics: What every business leader should know

With a continued lack of trust in politicians, unexpected turns and outcomes in 2016 and the pressure applied on some companies by the media, many business leaders prefer to steer clear of political engagement but that is the wrong approach, especially looking forward to 2017.

Traditionally, those companies and sectors who are the most heavily regulated have tended to be more active in their political engagement. However, few organisations are immune from the intervention of politicians. This can, of course, be unexpected but longer term engagement and maintaining a watch on what is said and done in Parliament will help.

And things are about to get a whole lot trickier for businesses. Just look at what is happening in the US. Donald Trump issues tweets directly criticising businesses and individuals, and on matters that impact directly on share prices. Whether he should be taken literally is open to question but such a tweet will generate media interest, possible global media interest, and the markets tend to take comments literally.

Trump is using Twitter to get around traditional media and to talk to directly people. If other politicians think that approach works then more will follow suit.

Similarly, the Brexit debate is currently being carried out through the media. A plan may be published around February 2017 but businesses have a clear choice – engage now or simply wait and see what the outcome is. Given the timings involved, with Article 50 due to be triggered before the end of March, they may be little time to influence the plan once it has been published.

So business leaders need to be aware that:

• Politics is critical to business operations – for some that may be about doing business with government, for others politicians are setting the regulations and environment for doing business with others.
• Politicians know the value of reputation – whether it is questions in Parliament, tweets or Select Committee reports, politicians know that people and the media listen to them.
• Public affairs is worth investing in – to be able to cope well, the public affairs team needs resources. This can include people or the provision of services to help them deliver (media and parliamentary monitoring for instance)
• Public affairs is part of risk management – as a result of what has happened in 2016, 2017 will be all about managing risk and trying to take advantage of the opportunities that may exist in sectors.
• Public affairs is also about allowing opportunities to be identified – so it is not just about managing risk but potentially identifying new opportunities, seeking potential new markets or ensuring that politicians do not become ‘over-excited’ about emerging opportunities or technologies. Anything new is often misunderstand and that is especially the case where it comes to technology.

So there are clear top line and bottom line benefits to getting political engagement right and taking it seriously.

Just think about 2017 for a moment. The shape of Brexit will largely be determined next year. No company can afford not to get involved, either directly or through trade bodies.

There will be others trying to shape that new future as well. Competitors at home. Competitors abroad. All this whilst the Government is already stepping up its efforts to deliver opportunities for inward investment and for exporting. The Government is looking to help and support but you need to be engaged to know any of this.

This is also a time when Government is listening.