In this post, David Coen, Professor of Public Policy at UCL, Dr. Alexander Katsaitis, Fellow in Public Policy & Administration at the LSE, Dr. Matia Vannoni, Lecturer in Public Policy at KCL, dispel three myths around business lobbying in the EU to reveal how it’s instead based on a nuanced and layered interaction.
As the United Kingdom (UK) begins to grapple with Brexit and its implications, understanding how the European Union (EU) engages with business will attract the prevailing attention of policymakers and company boards for the foreseeable future. The EU is the UK’s main trading partner, placing it de facto high on business’ agenda.
Moreover, business plays a significant role in the EU’s day-to-day policymaking. It provides valuable information to technical experts, it actively mobilises to influence policy, and engages with political organisations. Put simply, to appreciate how the EU functions, we need to observe its relationship with business.
Nevertheless, the relationship is complex. The European Union’s structure combines intergovernmental bargaining with supranational authority, it employs a diverse institutional system, it has a distinct multi-level structure, and comprises of overlapping governance networks.
Significantly, lobbying more generally and in the EU’s complex context specifically, tends to be shrouded in myths. This makes observing, assessing, and understanding the relationship an overwhelming task. In this brief piece we dispel three common myths associated with business lobbying in the EU.
Myth #1: Money Can Buy Me Love
From a wide-angle perspective, business-government relations in the EU have been expanding since the 1960s. Most notably, the Single European Act in the mid-80s and the Maastricht Treaty in 1992 led to the first wave of government affairs offices in Brussels. Companies diverted resources away from national contacts and made dedicated efforts to contact EU institutions and set up stronger EU wide associations.
As the EU continues to expand and integrate, so do government affairs offices in Brussels. Currently there are approximately 12,000 interest groups registered on the Joint Transparency Register, a database where interest groups aiming to lobby EU policymakers must register. While over time the population has become more diverse, still half of the groups represent business interests, such as companies or trade and professional associations. The size of the population indicates the EU’s impact on organised interests. It also highlights the stark competition between groups to gain access to policymakers and policymaking procedures.
Business competition has brought about new agile strategies, including the use of political financing and media communications. However, money is not sufficient to grant access to policymakers. Ultimately, EU policymakers remain to a great extent regulatory rule-makers. Their relevance remains highly dependent on producing high-quality policy outputs, and demand reliable and relevant expertise to do so. We observe that the insiders gaining access more often than not, are potentially less resource endowed interests which supply the expertise in demand.
Therefore, establishing a relationship of trust between the firm and the policymaker remains key, this requires investing time in establishing contact and providing reliable expertise, which in some cases may even lead to a short-term cost for the firm.
Myth #2: Business is Everywhere!
Business interests have a strong presence in Brussels. Nevertheless, their mobilisation does not cut across the board. Much like policymakers, business has finite resources. It must select when to mobilise and where. Being strategic business mobilises where and when demand for its expertise is higher.
Policymakers’ demands differ across policy fields. Policy fields where demand for technical expertise and output legitimacy (policy outcomes) is greater, tend to be associated with regulation such as trade or the environment; there business mobilisation is notably greater. Conversely, policy fields where demand for political expertise and input legitimacy (policymaking inclusiveness) is greater, tend to be associated with (re-)distributive policy; there business mobilisation is notably smaller. In fact, civil society organisations even overtake business activity. This becomes particularly evident when assessing business activity around the European Commission’s Directorate Generals and the European Parliament’s Committees that deal with different types of issues.
Similarly, business is likelier to be granted access to policymaking during the policy cycle’s steps where technical expertise is in high demand, rather than steps during open political debate such as the parliament’s plenary. Therefore, successful business mobilisation is targeted to supply information-legitimacy where it demanded it the most.
Myth #3: The Line Between Business and the EU is Blurred
Influenced somewhat from the lobbying scene in Washington DC as well as some high-level visible cases, we tend to automatically link business-EU interactions with the “revolving-door”. This is the phenomenon where individuals working for the public sector move to the private sector and vice-versa. In the US in particular the phenomenon is somewhat more pronounced. An individual may switch back-and-forth between sectors over a lifetime, depending on the administration, election results, and other similar factors.
Reflecting the need to build relationships of trust with policymakers, the individual firm in Brussels takes strategic choices about its staff. To build up its credibility as a political and technical actor in the short term, and its reputation as a policy legitimising actor in the long term. The firm tailors its expertise capabilities as necessary, appointing government affairs’ managers who know their company’s goals and can communicate them to EU regulatory experts and politicians. Therefore, most officials and managers remain in their sector creating a clear distinction between private and public sector.
Therefore, successful firms invest in developing staff’s expertise capacity and maintaining them onboard for the long term. Ultimately, government affairs’ officers engage with EU policymakers on a daily basis, their profile impacts business-EU interactions.
Overall, business lobbying in the European Union is a nuanced and layered interaction. Successful business representatives supply reliable expertise, contribute to policymaking without spamming, and invest in their staff’s expertise capacity. Significantly, this is a long-term investment.
To find out more on business lobbying in the European Union, listen to David Coen in a new episode on the UCL Uncovering Politics podcast series.
Note: The views expressed in this post are those of the author, and not of the UCL European Institute, nor of UCL.