Back in June 2020, I was fortunate to participate in the launch of an essential report on corporate affairs from Oxford-GlobeScan. Corporate Affairs directors from global companies, such as Intel and Anglo American, shared with us why this profession is vital to their companies. Moreover, they discussed the findings of the survey, clarifying what the top risks for their firms are, what are their priorities and to what extent they see the activity as truly effective (a tough one!).
Today, the report was released and I’d like to share it with you here. If you have any technical difficulties, I’ve downloaded a copy:
If you are in the business-government sector, I can say I’ll read the report, but I’d like to share what caught my eye. First, the list of the most pressing risks in the upcoming 24 months brings geopolitical risk at #1, followed by ESG issues and the economy. Regulatory pressures and regulation risk are also important, and data privacy is also one of the most pressing risks.
Second, building trust was named as the top priority of the Corporate Affairs function for the next 12 months, with regulatory changes and compliance as #5. The political landscape is at #12.
This is in line with two essential webinars, about Responsibility, recovery and reputations, I’ve included in the webinar list of the past week. You’ll see how the issues are connected.
Lastly, the survey shows that Corporate Affairs will have a more important role to play after Covid-19.
Why does it matter and what are my key takeaways:
1. Corporations with higher reputation have more power, both with their customers and vis-à-vis the national governments. It can provide companies with a particular form of political influence that creates a favourable context for actions of influence, such as lobbying or campaign donations. In the digital world, there is an important study of Culpepper and Thelen (2019), which I find very interesting and addresses the support of customers as another source of power to challenge policymakers. They called it “platform power”. Reputation might be a more decisive factor in influencing policy now.
2. Geopolitics is very important for business because of the policies and their implications. Think about TikTok and how the relationship between the US and China is a determinant factor. Or the European energy policy and their relationship with Russia. It has impact on businesses and requires attention.
3. My last takeaway is about the growing importance of the corporate affairs position post-Covid-19. This is mostly because the corporate affairs have a substantial scope of government relations and stakeholder engagement, which is coherent with the overall report.