With a new administration preparing to shake up the legislative and regulatory landscape, now is the time to hire a Head of Government Affairs. Heads of Government Affairs establish connections with government, trade associations, and other stakeholders and can ensure your company’s interests are protected in the years to come. Hiring a Head of Government Affairs now allows that person to engage relevant stakeholders and advocate for your company whenever critical laws or regulations are proposed. While many companies have executives who publicly address company interests, a Head of Government Affairs will ensure your voice is consistently heard, your interests will be factored in regardless of company size, and you don’t have to break the bank to accomplish your goals.
Make Your Voice Heard
At a bare minimum, any Head of Government Affairs can help you prevent or promote relevant legislation. A great Head of Government Affairs, however, will also build relationships with external partners in the public and private sectors, such as regulatory bodies or professional and trade associations. These relationships will give you a stronger voice in shaping your industry’s future and prevent any legal or regulatory surprises from catching you off guard. This person is constantly on the lookout for not only what is important to your company, but also what can adversely affect the industry and/or what topics are currently being debated among elected officials. For example, all automobile manufacturers felt the pressure of the Obama Administration’s new fuel efficiency standards. Within a month of the 2016 election, the Alliance for Automobile Manufacturers presented domestic manufacturing data to the incoming Trump administration to encourage a roll back of the new standards. By working on their platform early and building relationships with individuals who are concerned about how any regulation will affect domestic manufacturing, the Alliance crafted the right message to the right individuals and are likely to prevail in their lobbying.
Your own PR team is not enough! Some companies believe making a speech, issuing a press release, or publishing a paper is enough to make their voices heard. It is not. With hundreds of articles, tweets, and video clips drowning you out, it’s crucial to have someone consistently promoting your interests to the appropriate stakeholders before a decision is being made, and in a way that will resonate. A good Head of Government Affairs will know how to get the attention of the people who matter to ensure that your concerns are addressed before best practices, regulation, or legislation are formed. In the case of the Alliance, their government affairs team didn’t just present the industry position but researched the overlap with the new administration’s domestic manufacturer agenda.
The most successful companies realize that reputation is not enough to turn their priorities into policy. Due to their highly effective government affairs outreach, pharmaceutical companies were left largely unchanged under The Affordable Care Act, while hospitals and health insurers faced major restructuring and additional costs. Today, prescription drugs are the fastest growing area of medical costs with minimal price regulation. John McDonough, a top health policy adviser to the late Senator Ted Kennedy during health law negotiations remarked, “There was nothing in the deal that was a structural reform of the [drug] industry. They were first in line; they were on the winning side; they got a good deal that they could live with and they stuck to it.”
Whether it was the automobile industry speaking in the language the administration wanted to hear or the pharmaceutical industry knowing the administration just wanted a deal done, government affairs teams made sure their companies’ voices were heard and acted upon.
Ensure Your Interests Considered Regardless of Company Size
Heads of Government Affairs aren’t just for billion-dollar companies. Every year, state and local governments pass laws that greatly affect local businesses. Everything from minimum wage hikes to paid family leave can have a profound impact on a company’s bottom line, so it is crucial that businesses of all sizes have an advocate in government.
This past year, New York City’s small businesses used government outreach to pass landmark legislation. Abusive landlords, unpredictable maintenance, and sky-high rent were driving small businesses out of the city. Facing financial failure, these businesses joined together to voice their grievances through government affairs. Campaigning through the Association for Neighborhood & Housing Development, they successfully passed the first legislation protecting commercial tenants. If these businesses relied on PR and press releases to promote their message, this legislation would likely have failed.
Waiting for the spotlight to hit your company is a recipe for disaster. Hiring a Head of Government Affairs sooner rather than later gives him/her time to build public support through grassroots, grass tops, and other major channels. This momentum will make it easy for decision-makers to support your interests when key legislation comes around.
In the wake of the recent election, Congress is already considering new infrastructure spending bills. Embedded in this legislation is a “Buy American” provision, requiring that the majority of federal funding be used to buy U.S.-produced iron and steel. While this is a great victory for domestic steel & iron producers, the provision never would have passed had the manufacturing industry waited to see election results before their government affairs teams began outreach. Having established connections allowed these companies to capitalize on recent support for domestic manufacturing and infrastructure spending and boost their revenue for years to come.
In government, agendas can change from one minute to the next. A Head of Government Affairs will stay on top of the current mood and act when the time is right. Recently, New York State restaurants had the perfect opportunity to update state laws and boost their businesses. For years, these restaurants were missing out on thousands of dollars in revenue because of an antiquated liquor law preventing them from selling alcohol before noon at Sunday brunch. This past year Governor Cuomo created a panel to investigate modernizing the state’s liquor laws. Since the Empire State Restaurant and Tavern Association (ESTRA) had already established themselves as a leading advocate for New York’s restaurants, they were granted a seat on the panel. From this privileged position, the ESRTA successfully recommended updating the Sunday liquor laws. Their long-standing relationships with state and local government allowed the ESTRA to seize this opportunity and increase profits for tens of thousands of businesses of all sizes.
You Don’t Have to Break the Bank
While the media likes to focus on top lobbyists at the biggest firms, most government affairs specialists are not ex-senators commanding upwards of a million dollars for their services. Instead, they are hardworking, incredibly knowledgeable insiders who know how to work the system and get things done at a much lower price tag. Their salary could easily pay for itself when legislation comes around that could make or break your company.
Relationships with the government, trade associations, and industry organizations are a long term investment. It will take many conversations to motivate a lawmaker, and many lawmakers to motivate a legislature. Having someone who can efficiently navigate a complex bureaucracy will save you precious time and energy in the long run.
Whether it’s the minimum wage, licensing requirements, or local liquor laws, all companies are affected by legislation and regulations. Instead of waiting to see what laws prevail in the future, your company’s interests should be considered whenever relevant laws and regulations are proposed or reviewed. Having a Head of Government Affairs is the first step to building an effective relationship with elected officials, trade associations, and all relevant stakeholders who can advocate for your company. It will help you protect your interests for many years to come.