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CHAPTER 5 

Stakeholders 

 

The Stakeholder Concept 

In today’s complex societies, there are many individuals and organizations with different interests, expectations, and demands with respect to corporate and public governance. These individuals and organizations have come to be known as stakeholders. This chapter focuses on the stakeholder concept, both in its original formulation as a designation of all the groups in society that have a stake in decisions made by corporations and an alternative application of the model to all the groups in society that have a stake in the outcome of public policy decisions. As we shall see, when we analyze business government relations from the perspective of a business enterprise, the original, business-oriented model provides a useful analytical tool for commercial diplomats. When we turn the perspective around, and we want to analyze business government relations from the perspective of the government, the alternative public policy oriented model serves as the more appropriate analytical tool.

 

The Business Stakeholder Model 

 The stakeholder model was developed initially to identify the various groups in society that were directly affected by business decisions, and in turn could influence the success or failure of a business enterprise. Some theorists concluded that a firm or enterprise therefore in an economic and moral sense “belonged” not only to the shareholders of the firm, but also to the other stakeholders who had an economic link with the firm. The term “stakeholder” was even used by a major political leader, Tony Blair, Prime Minister of Britain, when he called for an economy characterized by “stakeholder capitalism” rather than “stockholder capitalism” (1). 

To be specific, what is a stake? A stake is an interest or a share in an undertaking. It is also a claim. A claim is more than an interest; it is an assertion to a title, or to a right. The concept of a stake, therefore, can range from a simple interest to the extreme of a legal claim of ownership and all the value between. A stakeholder then is an individual or organization that has one or more stakes in a business. Stakeholders may affect a business or be affected by it. It has been suggested that a good definition of a stakeholder is any individual or group that can affect or is affected by the actions of decisions, policies, practices, or goals of the organization. 

With these definitions in mind, who are stakeholders of the business firms? The stakeholders that immediately come to mind are the investors—shareholders and others whose claim denotes a share of financial ownership. Other obvious stakeholders are managers and employees, suppliers, and customers. The local community where the firm’s facilities are located are also stakeholders. These are the ones that come to mind easily and a where a direct link is apparent. 

There are other stakeholders, as well, and these include government and regulators. They are affected by and affect the firm. Civic and educational institutions, social pressure groups, the media, trade bodies, and even competitors are stakeholders. How can competitors be stakeholders in a firm? If a corporation is found to be taking great risks in providing unsafe products to the market and these risks become known to the public, the industry, and therefore all competitors, are affected because the spotlight of scrutiny will fall on them also. Social pressures groups such as human rights activists are also stakeholders. See Figure 5.1 for a list of generic stakeholders. 

The most important aspect of the stakeholder concept is that it identifies many more participants in the business policy and public policy process than does a sector approach. The variety, number, and importance of stakeholders is dependent on the issues that face a business. If the issue is one regarding international trade, then those governmental stakeholders that are involved with international trade are much more important than, say, the Department of the Interior’s park service. In practice, a generic list is only the beginning of the identification process.

  

Figure 5.1
Generic Stakeholders
 

  • Shareholders and Investors  

  • Employees and Managers 

  • Customers 

  • Local Communities 

  • Suppliers and Other Business Partners 

  • Government and Regulators 

  • Civic Institutions 

  • Social Pressure Groups 

  • Media 

  • Academic Commentators 

  • Trade Bodies 

  • Competitors 

  • Others 

 

Note: 2

There are three benefits to applying the stakeholder model in business relationships. First, it is a good description of the various actors involved. Secondly, it is a more useful view because it can be used to establish the active connections between the actors. Lastly, it identifies the stakeholder interest in the organization regardless of whether the business organization has any interest in them at all. The stakeholder model provides business management with a methodology for identifying all the groups affected by business decisions and their legitimate concerns, and for analyzing the means by which these groups in turn can affect the interests of the firm. It thus provides a broad basis for evaluating business decisions. It also provides every stakeholder with a broad view of all other stakeholders capable of influencing corporate decisions.

 

Management of Stakeholders 

The manager of a firm is the central figure that must also manage the treatment of stakeholders, their influence with regard to the firm, and their interests. Management must be able to ask and answer a number of questions about the stakeholders that must be satisfied. These questions are given below, with further explanation for each one (3).

 

A.        Who are the stakeholders of the firm? 

Thus far, only generic stakeholders have been presented, however, in practice, specific stakeholders must be identified. That is, which class of employee, or size of customer, or important suppliers, and so on should be considered? The details can be extensive, but without a clear identification of who the stakeholders are, the organization cannot begin to provide a strategy. For example, although the government is a stakeholder, which agencies and departments are truly involved with the firm in specific issues? In an issue involving international trade and investment, the departments or ministries responsible for trade, domestic commerce and foreign affairs might be the key government stakeholders. Departments or ministries responsible for Interior Affairs or Human Health Services may have no relationship to the issue being addressed. 
 

B.        What are the stakeholder’s stakes? 

Here, it must be asked, what are the stakeholder’s interest, concerns, and perceptions of rights, expectations, or even ownership? As examples, consider two sets of stakeholders—the government and environmentalists. 

The government’s interest in a firm can be as regulators, tax collectors, customer of defense products, trade balance manager, and many others related to the public good. The environmentalist’s interests are in the surrounding ecology, the public’s right to be free of exposure to long-term ill effects, the effect of global warming, the elimination of species, and other interests. In all of these cases, it is important to determine the legitimacy, urgency, and power of each group with regard to each interest. 
 

C.        What challenges does the stakeholder present to the organization? 

The challenges normally take the form of demands of or responses by the firm. Challenges also arise when crises occur that appear to be the responsibility of business. Some examples are an oil spill by an oil tanker, where the company can face heavy fines, social pressures, criminal and civil suits, while the captain can face termination, damages, and criminal charges. Another example is an anti-trust case, where the firm accused of an anti-trust violation can face new challenges from government, customers, competitors, the media, the financial community, as well as others. Each interest, of course, is of different degrees of importance. 
 

D.        What responsibilities does the firm have to the stakeholders? 

In chapter 3 on Business we identified four generic business objectives: economic, legal, ethical, and philanthropic. An examination of each of these objectives as they relate to each stakeholder can generate useful insights for both business managers and commercial diplomats. Some of the economic objectives relate most directly to the interests of stockholders, legal objectives to the interests of governments, ethical ones to the interests of non-governmental organizations, and philanthropic ones to the interests of the community.
 

E.         What strategies should management take? 

After management has determined the responsibilities and stakeholders involved, a highly important question is, “What strategies should management take?” 

Management at this point may take an approach that looks at each stakeholder and decide whether the stakeholder has a high or a low potential for cooperation with the firm, and whether the stakeholder has a high or low potential for threat to the firm. In this way, four types of stakeholders can be examined. The case of computer chips dumped by foreign firms into the country can provide an illustration of how a four-type system could be applied. Stakeholder Type 1 is one with a high potential for cooperation and low potential for threat to the organization. The strategy here is for management to have these stakeholders highly involved. In the case of the dumping, business management would want trade officials, legislators from the district where factories are located, employees whose jobs are threatened, domestic suppliers whose business would be negatively impacted, and others having a high potential for cooperation and a low potential threat. These groups will be supportive of the firm. 

Stakeholder Type 2 is one with a low potential for cooperation and a low potential for threat. The appropriate management strategy here would be to have the stakeholder closely monitored for change in attitude. These stakeholders include consumer interest groups, local universities, environmental groups, and public affairs groups. A public affairs group may be concerned with the country’s independent foreign sources of supply and may take a position, but the specific dumping case may not be of sufficient interest. Monitoring the situation would be appropriate. 

Stakeholder Type 3 is one with a high potential for threat and a low potential for cooperation. The nonsupporting groups could include academic economists, “free trade” public affairs groups, other industries trading heavily with the offending foreign firms, and others. The appropriate action is for the organization to actively defend its position. 

Stakeholder Type 4 is one with a high potential for threat and a high potential for cooperation. This is a mixed-blessing type of stakeholder. Management’s handling of this type can make the firm either a success or a failure. Such a stakeholder in this case would be the computer chip maker’s customers and defense officials. If either of the above believe that the level of higher quality produced by foreign firms and their very low prices are sufficient incentive to not press any dumping case then the anti-dumping action may not succeed. The strategy here is to collaborate. By collaborating, the stakeholder will remain actively cooperative and the firm will be able to influence the final position of the stakeholder. 

For each type of stakeholder, the management strategy can be specified to some degree. For example, a stakeholder of Type 1, a supportive stakeholder, one with a high potential for cooperation and a low potential for threat, should elicit a management strategy to involve these stakeholders in the issue. Employees may be this type of stakeholder. The figure below presents the suggested management strategies for each stakeholder type. 

 

Figure 5.2
Types of Stakeholders and Management Strategy
 

Stakeholder Type

Description

Political

Strategy

Management

Strategy

1 

  
2


  3
 
 

4

 

Supportive 

  
Marginal 


  Nonsupportive
 
 

Mixed Blessing

Low Threat/High Cooperation 

Low Threat/Low Cooperation 

High Threat/Low Cooperation 

High Threat/High Cooperation

 

Involve Them 

  
Monitor Them
   

Defend Against Them
   

Collaborate with Them

 

Note: 3

An Alternative Stakeholder Model for Commercial Diplomats 

The stakeholder model is a tool that can be applied as effectively to public policy decisions as to business decisions. Under this alternative application of the model, the decision-maker who is the focus of the model is the public policy manager, and in the case of commercial diplomacy, the senior manger in the government who is charged with making decisions on policies and actions that affect international trade and investment. A stakeholder in this application of the model is any individual or organization that has a stake or interest in a public policy decision that affects international commerce, and the ability in turn to affect the outcome of such a decision. 

As in the case of the business variant of the model, stakeholders may affect a public policy decision or be affected by it. The definition of a stakeholder under this public policy model remains the same as under the business model, namely it is any individual or group that can affect or is affected by the actions, decisions, policies, practices, or goals of the organization, which in this case is the government rather than a business organization. 

With these definitions in mind, who are stakeholders in a public policy decision? The stakeholders that immediately come to mind are the individuals and enterprises whose economic interests are affected by the decision, and the interest groups that espouse public policy goals affected by trade and investment policy decisions. This can include interest groups that espouse environment, labor, public health, human rights, and similar goals. Other obvious stakeholders are the various government ministries, departments and agencies responsible for policies that are directly or indirectly affected by the decision This list can include officials responsible for commerce, agriculture, labor, finance, foreign affairs, health, safety, environment, justice, competition policy, among others. The local communities affected by the public policy decision are also stakeholders, are the voters and the legislators who represent them, the press and the policy research community. 

In the case of public policy decisions within the ambit of commercial diplomacy, the list of stakeholders includes all the affected groups in other countries as well as in the home country. In fact, the advantage of the stakeholder model in commercial diplomacy decisions is its capacity to analyze the relationship between the interests and actions of affected individuals and organizations in different countries. It gives decision makers involved in public policy decisions that affect international trade and investment a useful framework for analyzing the interests of all the individuals and groups capable of influencing the outcome. 

The analysis of stakeholder interests under the public policy/commercial diplomacy variant of the stakeholder model, the analysis revolves around the organizational objectives of stakeholder groups as well as the personal objectives of individual managers. An analysis of these objectives and interests follows the same pattern as described above for the business-oriented stakeholder model. The major difference between the public policy model and the business model is likely to be a difference in the relative weight assigned to social goals and bureaucratic turf issues as against purely economic goals. Public policy decisions are all about social goals, and it should therefore be expected that social goals are likely to have a greater weight in an application of the public policy variant of the stakeholder model. Likewise, competition among government units is often not only about differences in policy goals but also about issues of bureaucratic turf, and we can therefore expect such issues to arise more often in an application of the public policy model. 

We saw that in the case of the business model, the interests of stakeholders could be mapped to the economic, legal, ethical and philanthropic objectives of business. In the case of the public policy model, the interests of stakeholders can be mapped to the commercial, economic, political, legal, social, ethical, foreign policy and security objectives of government.

 

Treating Stakeholder Interests 

Treating the stakeholder’s interests and obtaining conciliation and support requires an understanding of stakeholder theory and the activities of stakeholders in pursuing their interests. The identification, evaluation, and selection of strategies by stakeholders, and their implementation are central to an understanding how a decision making organization is able to resolve all issues, and ultimately meet the objectives and performance criteria of the business or public policy organization.

 

Objectives, Performance, and Rewards 

The objectives of each stakeholder vary with their interest or claim. The stockholder requires a total return of dividends, plus stock appreciation that is satisfactory. Government, depending on department, requires implementation of a public policy goal. The interest groups representing environmentalists expect a better record of ecological responsibility, and so on. Those that expect them can measure these diverse objectives, and the performance considered to be adequate or not. The rewards, of course, vary as well, and are closely tied to the identity of the stakeholder. It is the capacity of the stakeholder concept to portray the integration of highly diversified objectives pursued by different groups in today’s complex society that makes it such a practical tool for commercial diplomacy.

 

Summary Points for CD ProfessionalS 

1.                  The stakeholder model of reality is better than a sector model in terms of defining all of the actors and institutions involved in public policy.

2.                  The list of stakeholders is very long, but a necessary one to consider for the practical resolution of issues.

3.                  All stakeholders are not alike in interests or strategic treatment. Each type of stakeholder has an appropriate treatment to be considered.

 

NOTES

1.                  “Stakeholder Capitalism,” The Economist (February 10, 1996), 23-25.

2.                  James E. Post, et al. (1999). Business and Society: Corporate Strategy, Public Policy, Ethics. New York: McGraw-Hill, pp. 10-11.

3.                  The discussion of pages 5-9 in this chapter is greatly dependent on Archie Carroll and Susan Buckholz, Ibid.

   


Part 2 ¾ Political Strategies and
Stakeholder Interests
 


CHAPTER 6

Introduction to Political Strategies 

 

Overall Subject 

We now want to turn to the management of business government relations from a business perspective. For purposes of this discussion, we will use the original, business-oriented version of the stakeholder model as an analytical tool. When we later turn to the management of business government relations from a government perspective, we will use the public policy oriented variant of he stakeholder model as the appropriate analytical tool. 

As we learned in the previous chapter, stakeholder interests and expectations can be related to their degree of support for the organization. When stakeholders learn that their expectations cannot be met regardless of the amount of influence and pressure they bring to bear, they find that their best answer is to turn to government. Here, they implement political strategies that are of the utmost importance in the scheme of government relations. The strategies to be covered here in Part 2 are: lobbying, grassroots campaigns, coalition building, testimony, political entrepreneurship, electoral strategies, communications and public affairs, judicial, advisory panels, and governmental rapid response. Most of these will be covered in this chapter, except for those requiring more extensive treatment. Lobbying, coalition building, communications and public affairs, governmental rapid response, are all discussed at length in separate chapters of Part 2. 

Grassroots campaign. An important strategy is the use of a grassroots campaign. Grassroots campaigns are based on the connection between constituents and their elected representatives. Many interest groups engage in grassroots political activity in order to show the breadth and strength of their interests in the subject targeted. Grassroots campaigns are run often enough that the number of political consultants who specialize in this approach has increased in recent years. However, with their increased use, legislative leaders may have also become more astute in assessing the degree of impact of these campaigns. 

In grassroots campaigns, there are a number of key elements necessary for their success. The first important element is that grassroots campaigns target individuals. They may be members of interest groups or other organizations; however, individuals are the objects of attention. The individuals are, however, parts of types of stakeholders having an interest in the issue and therefore have better knowledge of it than the public in general. Once the grassroots base of individuals is established, generally numbered in the thousands, the program can then be put into motion. 

The first step is planning and budgeting and this is more important here than in most political approaches. The reason is that to reach thousands of people, the cost of staff and expenses, communication including telephone, email, and computers, training, conferences, recognition programs and awards, all amount to a large amount per individual responding. The second step is the campaigner’s ability for recruitment and motivation of volunteers for the campaign’s network. Motivation is obviously tied to the individual’s beliefs and their intensity. The identification of the individuals in great detail including personal identification, address, local political contacts and activity, legislative district, particular sensitivities to issues, and more, is an important part in motivating the individual. 

Following the planning and individual identification, the next step is to train and provide orientation for the individuals in the network. This step requires the generation of training materials on the issues, the campaign, how to participate, the goals to be attained, and more. Then, the materials are all communicated to the individuals with an appeal for action. 

The appeal for action should be specific: who in government is to be contacted, how, where, when, and the position to be expressed. Talking points, various examples of letters, a call for personal experiences to be conveyed, all are part of the final action. 

Finally, after the campaign is over, the individual participant must be thanked, informed as to the result, and appealed to for inclusion in the next campaign. The campaign manager must be prepared to maintain the individual as part of a pool of resources for future efforts. Eight essential principles for grassroots campaigns have been provided in Figure 6.1.
 

Figure 6.1
Essential Principles for Grassroots Campaigns

 

  • Individuals must be motivated and recruited to participate.

  • They must be mobilized and trained in techniques of legislative communication.

  • Issues communications to participants should be frequent, factual, and objective.

  • Grassroots messages to legislators must reflect some understanding of the issues to be credible.

  • Appeal to action must be specific and clear as to issue messages, action needed, and action targets.

  • Grassroots, political action, and community relations programs should be closely coordinated.

  • Participants need frequent feedback to assure them of the value and effectiveness of their efforts.

  • Participants should be encouraged to provide their own feedback to program managers on responses from legislation.

 

Note: 1

Testimony, the fourth on the introductory list of political strategies, is a common means of influencing political outcomes. Executives testify before legislative committees, regulatory agencies, administrative agencies, and courts. Testimony is important because not only does the information affect the decision, but also because it creates a record that serves several purposes. The testimony can provide new information to members of the legislature or other bodies who have not been lobbied, it can be the basis of a position statement to be built upon in future communications, it can be used to support the committee chair, or even be the news story for the morning TV news program. In fact, testimony can be part of a drama that has been totally orchestrated to effect support or opportunities for a specific issue. 

Political entrepreneurship is the active role by a high-profile individual who may be an organization’s CEO or key executive to take a key issue to the nation’s capital. The field of trade and investment has been ripe for political entrepreneurs. In semiconductors, the late Robert Noyce, co-inventor of the integrated circuit and a founder of Intel, became one by spending virtually all of his time in the 1980s in Washington, primarily for the political solution to trade issues facing the semiconductor industry. The CEOs of MCI, Boeing Beach, American Express, and others during the late 1990s spent an enormous amount of time as political entrepreneurs in Washington pursuing their companies’ cases. In fact, during this same time, the presence of corporate executives to act as “Lobbyists” for the industry became more common, a situation of which Congressional members generally approved. 

But political entrepreneurs need not be businessmen. They can be any strong leader who is making the cause his own. Probably the best well-known political enterprise in the United States today is Ralph Nader, primarily in the field of consumer public interest. Others have included John Gardner of Common Cause, Ross Perot (new political party), and Jesse Jackson (civil rights). 

Electoral strategies involve providing important electoral resources to candidates for office. Among these resources are endorsements, volunteer workers, and campaign contributions. There are a number of basic reasons for providing campaign contributions. These include an attempt to influence legislative voting, obtaining access to officeholders, present or future, and finally to help the legislator get elected that the contributors want to influence. It appears that if the contributor can expect any return for his/her contribution it is likely to be in terms of obtaining access rather than any certain influence or votes. Also, it is not necessarily important to be ideologically aligned with the legislator being financed. It is more important to understand how important the legislator is to the issues that contributors want to influence. For example, the chair of a key committee, regardless of party, would be contributed to sooner than a legislator who may be ideologically aligned but is not on a key committee and further has no interest in the contributor’s issues. 

The laws and practices related to campaign contributions vary significantly across countries, and aer one of the most debated aspects of any democracy. Under the existing legal framework in the United States, such contributions are channeled through Political Action Committees (PACs). The most controversial aspect of campaign financing involves the source and amount of funds and whether the money is “soft” money for broad party purposes or “hard” money for a specific individual’s campaign. This area is under such intense legislative debate at this time that the reader of this manual should receive a current update at all times. PACs will be discussed more fully in a later chapter. 

Judicial strategies are those that use legal action to enforce rights, enjoin competitive actions, obtain damages, stop predatory business practices, and even more simply to have a forum to present “Amicus briefs” to generally support a position. Judicial action generally involves a long period of time and is very costly. Dumping cases in international trade that were handled through the courts in the United States in the 1970s often took ten years or more to settle. This is hardly an expedient means of resolving issues in industries whose products have total life cycles of three years or less. However, the courts are still often used for cases involving intellectual property, that is, patents, copyrights, and trademarks. 

Advisory panels and committees, of which there are over 1000 in he United States, are well entrenched in government activities. Advisory panels and committees provide benefits to both the government side, as well as the private side of the table of members. For the business firm, participation on a panel provides information about possible decisions an agency is about to make and therefore can also provide a way to put an issue on the agenda of an agency if it isn’t there already. Furthermore, it raises the public awareness and reputation of the firms involved on the panel. From the standpoint of government agencies, the panel provides the government with expertise, which can clarify the consequences of alternative proposal policies. From the government agency’s viewpoint, it also provides a way of building support for its policy objectives. This last raises the reputation of the agency relative to the legislators and agencies in other government departments. The advisory panel, if utilized properly by the commercial diplomat, can be a strong tool toward shaping the eventual legislative policy.

 

SUMMARY POINTS FOR CD PROFESSIONALS 

1.         The CD professional must be aware of the political strategies that will advance the organization and stakeholder interests. 

2.         This chapter has outlined ten types of strategies, with five of them to be expanded upon in the chapters to follow. 

3.         The overview of all the possible strategies clearly provides the Commercial Diplomat with a number of choices from which to make a selection to advance his client’s interest.

 

NOTES 

1.                  Charles Mack (1997), “Essential Principals,” Politics and the Practice of Government Relations. Westport, CT: Acorn Books, p. 207. Permission requested.

 


CHAPTER 7 

Lobbying 

Nature of Lobbying 

Lobbying is the personal provision of information to government officials including members of the legislature, commissions, staffs, and even the President or other head of government. Lobbying is the process of influencing public policy in much the same way as persuasion and requests or other forms of communication are intended to influence others for whatever reason. Lobbying takes place in all forms of organizations, although the term has primarily been used to describe the private sector’s efforts to influence government. However, government agencies and bodies also lobby each other. For example, the executive branch of the government may lobby the legislature and vice versa. Compared to other forms of influencing government, such as testimony and advisory panels, lobbying is informal and behind the scenes.
   

Reasons for Lobbying 

There are many reasons for lobbying, but at the core of them is the attempt by individuals and organizations to obtain either benefits or relief from government. For instance, the private sector cannot by itself change trade policy. It must depend on government. Those organizations most desirous of change will lobby for the changes they seek. Therefore, a reason here is there is no other recourse. Another reason is to gain an economic advantage or to nullify a sector opponent’s gain. Unions will therefore lobby to place duties on imports in order to maintain jobs. Another reason for lobbying is to single out a branch of government that will support a private sector goal that a different branch of government opposes. For example, an environmentalist interest group may seek national government control because local government control is inadequate. A different reason is to create new and different programs. All of these reasons and more can be attributed to the use of lobbying. Although other strategies could also be used, these serve as those, which would justify significant lobbying campaigns.

 

Applications 

Lobbyists apply their efforts in a number of ways. Three specific applications would include the following. First, the lobbyist will attempt to influence specific legislation. By influence, of course, is meant in the direction of his/her favor, whether it is to have it passed or failed. The lobbyist most often will attempt to use it to modify legislation if a straightforward pass or fail action is not possible. 

Another direction that lobbyists often pursue is to affect regulatory activity. The lobbyist may seek to strengthen or weaken a specific regulation or regulatory ruling that is pending. It may be virtually impossible to change a regulatory finding but it may be possible to modify the instrument used to enforce the regulation to make it less intrusive. Another target for lobbying activity is to shape executive branch policies, programs, and budgets. In changing policies, a whole new broad vista of outcomes is now available to the lobbyist and his/her clients. By changing policy, legislation, regulation, and other activities can be affected systematically. Finally, the lobbyist will also attempt to affect specific decisions regarding governmental appointments, contracts, grants, and other decisions that may have an effect but not as broad as the ones already mentioned. These then are the ways for the lobbyist to satisfy his/her needs to lobby: influencing and affecting legislation, regulation, policies, and personnel and fiscal decisions.

 

Who Lobbies 

Lobbying is done both by professionals who specialize in advancing the interests of their clients and by individuals and organizations that are affected by government decisions. The following list of lobbying scenarios provides an insight into the range of activities that could be treated as lobbying. 

2.      Management of organizations including business firms and interest groups

3.      Legal counsel acting as lobbyists

4.      Former government officials who have left office and now serve as lobbyists

5.      Dedicated lobby firms and public affairs firms with lobbying skills

6.      Government relations managers of organizations, such as business firms, and interest groups

 

Recent periodical articles on lobbying often list lobbying firms and interest groups as the most influential or active in Washington, D.C.. Some of these are given in Figure 7.1.

 

Figure 7.1
High-Profile Lobbyists in Washington D.C.
 

Top Eight Groups with Most Clout
in Washington
 

American Association of Retired Persons

American Israel Public Affairs Committee

National Federation of Independent Business

National Rifle Association of America

AFL-CIO

Association of Trial Lawyers of America

Christian Coalition   

Credit Union National Associations

Top Five Freelance Firms with Most
Power and Access in Business
 

Verner Lipfert Bernard McPherson & Hand

(Bob Dole, Lloyd Hand, Harry McPherson, John Merrigan, George Mitchell, Ann Richards)

Ex-Senators Dole and Mitchell provide the prestige, but wily workhorses like McPherson and Merrigan service New Orleans, Taiwan, Ameritech, and other major cities.

Barbour Griffith & Rogers

(Haley Barbour, Larry Griffith, Ed Rogers)

Haley Barbour went straight from chairing the Republican Party to lobbying for huge business interests that range from Big Tobacco to Microsoft to FedEx. 

Akin Gump Strauss Hauer & Feld

(Joel Jankowsky, Vernon Jordan, Robert Strauss)

Heavyweights include Strauss, former head of the Democratic Party, and Vernon Jordan, of Bill-and-Monica fame. But the lobbying genius is ex-Hill aide Jankowsky. 

Patton Boggs
(Thomas Boggs, John Jonas, Cliff Massa, Donald Moorehead, Stewart Pape)

The extremely plugged-in Boggs heads an all-star lobbying roster with 244 claims that run from trial lawyers to Chrysler, and from Bechtel to TRW.
 

Timmons & Co.
(William Cable, Bryce L. Harlow, Timothy Keating, Tom Korologos)


Korologos, a longtime GOP adviser and lobbyist, runs this small boutique, whose client list includes Dell, the National Rifle Association, and baseball’s commissioner.

 

 

Source: Fortune, Dec. 7, 1998

Personal Traits of Successful Lobbyists 

As indicated earlier, lobbying is a face-to-face activity that involves personal persuasion. The personal traits and character of the lobbyist are therefore paramount in the qualities of a successful lobbyist. Among the many traits are personal integrity, strong communication and persuasive skills, the ability to listen, possess an intimate grasp of formal and informal procedures, political sophistication, intellectual capacity, and strategic skills. A second combination of abilities is as exhaustive yet different. This list is shown in Figure 7.2

Figure 7.2
Abilities of a Successful Lobbyist

  • Defines the issues in any lobbying visit; determines at the outset what it wants

  • Knows the players

  • Knows the committees

  • Knows what the public rationale is on the issue

  • Prepares materials that are compelling

  • Anticipates the opposition

  • Is solicitous of political allies

  • Understands the process: the rules of procedure and the rules of compromise

  • Becomes cross-partisan eyes and ears

  • Observes the basic courtesies

 

Note: 1

Lobbying Guidelines  

The most skillful lobbyists and those with the best training do not commit the serious blunders of many neophytes and newcomers who attempt to lobby. A few admonitions are important here to keep in mind. 

1.         As a lobbyist for business interests, do not use “profits” as a motive for seeking help. Profits are not easily understood and are among the least acceptable reasons for public policy change. Only a few industries have used profits as an element of argument and only because it was related to research and development expenditures. Pharmaceutical companies have used profits and here where it is possibly justified the arguments have not always worked very successfully.

2.         The lobbyist should always ask for what is desired at the end of a lobbying visit. He/she never leaves the petitioned in doubt as to what is needed and the lobbyists should, to the best of their ability, obtain a definite response as to whether the request will be granted.

3.         Do not ignore precedence. Precedence often controls process, so attempt to allude to precedence if it will assist the cause.

4.         Never fail to tell the truth. This is the basic criterion of integrity and an untruth, once discovered, will affect all future statements and relationships.

5.         Do not ignore staff. Do the opposite. Spend as much time as necessary to prepare the staff of a committee or a congressman with the material required to obtain the desired results.

6.         Do not spring surprises, especially when there is only one source and it cannot be supported. Do not overextend the information in order to shock the party into action.

7.         Do not discuss policy and political campaigns at the same meeting. Lobbying for an expected outcome related to a policy affecting a client is not the time to discuss the congressman’s reelection campaign, funding, or related subjects.

 

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