Tag Archives: law

Lobbyists are taking a chance on self regulation

Lobbyiştii scot asul din mânecă – Forbes (8-21 martie 2010)

Last year I published an article in Forbes where I stated that the next step lobbyists are going to take in Romania, in order to avoid a lobbying law, will be to announce a self regulation initiative. Recently, during a conference dedicated to assessing the opportunity of a lobbying law in Romania, one of the lobbyists publicly announced that a voluntary registry of lobbying activities is going to be open by lobbyists themselves.

How will this make lobbying more transparent and why do lobbyists prefer self regulation instead of a law with similar conditions?

Possible answers in the attached article (Romanian only). Download a PDF version from here.


PwC Global CEOs Survey results released at the World Economic Forum: 60% of CEOs said they expect recovery in their national economies only in second half of 2010 or later

Overall, the survey found that 81% of CEOs worldwide are confident of their prospects for the next 12 months, while only 18% said they remained pessimistic. The results compare with 64% who said they were confident a year ago and 35% who were pessimistic; 31% of CEOs said they were now “very confident” of their short term prospects, up 10% from last year, a low point in CEO confidence since PwC began its tracking.

The survey revealed striking differences in confidence levels – and by extension the impact of the global recession – among CEOs in emerging economies and those in developed nations. In North America and Western Europe, for example, about 80% of CEOs said they were confident of growth in the next year. That compared with 91% in Latin America and in China/Hong Kong, and 97% in India.
Looking at the longer term, the results were more even. Overall, more than 90% of CEOs expressed confidence in growth over the next three years. Those results, coming at the start of a new decade, were about on par with confidence levels of CEOs in PwC’s 2000 survey. But 10 years ago the economic split was very different, with 42% of North American CEOs extremely optimistic – twice as many as in Asia.
For the future, a total of 60% of CEOs said they expect recovery in their national economies only in second half of 2010 or later, while 13% said recovery was already underway, and 21% said it would set in during the first half of this year. Return to growth was fastest in China, where 67% of CEOs said recovery had begun in 2009. However, nearly 65% of CEOs in the US and more than 70% in Western Europe said the turnaround would not begin until the half of 2010.

Other key findings of the 13th Annual PwC Global CEO Survey:

Fears for the future
Protracted global recession remains the biggest overall concern of CEOs around the world (65%), followed closely by fear of over-regulation (60%). More CEOs are “extremely concerned” about over-regulation (27%) than any other threat to business growth. Other high-ranking potential business threats included instability in capital markets, and exchange rate volatility. At the other end of the spectrum, concerns over terrorism and infrastructure were cited by less than a third of CEOs globally as threats to growth.

Love-hate relationship with regulators
CEOs were very clear about the threat of over-regulation. Over 65% of CEOs disagreed with the notion that governments have reduced the overall regulatory burden. They also opposed government ownership in the private sector even in the worst of times – nearly half agreed that government ownership helps to stabilise an industry during a crisis. CEOs from two sectors that received considerable government support during the crisis – automakers and banks – were amongst the most appreciative of government ownership in troubled times.

At the same time, CEOs were optimistic about governments’ efforts to address systemic risks such as another economic crisis – 65% of CEOs agreed that regulatory cooperation will help successfully mitigate systemic risks.

Combating the effects of recession
To combat recession, nearly 90% of all CEOs said their companies had initiated cost-cutting measures in the past 12 months, led by those in the US, Western Europe and the UK. And nearly 80% overall said they would seek cost cuts over the next three years.

Public trust and consumer behaviour
Over one in four CEOs believe their industry’s reputation has been tarnished by the downturn. However, 61% of CEOs in the banking and capital markets sector said there has been a fall in trust in their industry.

Nearly half of CEOs are concerned that the recession caused a permanent shift in consumer behaviour. Most say that consumers will place greater importance on a company’s social reputation (64%), spend less and save more (63%), or be more active in product development (60%).

Risk management
Risk management took on greater importance among CEOs as a result of the recession; 41% of CEOs plan to make major changes to their company’s approach to managing risk, and another 43% report plans to make some change to their processes.

Boards of Directors are becoming more engaged in key aspects of management; such as assessing strategic risk, monitoring financial health, and overseeing company strategy.

Climate change
More than 60% of CEOs said their companies are preparing for the impact of climate change initiatives and believe those efforts will improve their company’s reputation. The recession had little impact on the green momentum; 61% of companies with climate change initiatives saw no effect of the recession on their strategies and 17% raised such investments last year.

The full survey report plus supporting graphics which can be downloaded are available at: www.pwc.com/ceosurvey

McKinsey Survey: less than 25% of the companies whose primary market is in the European Union or the United States, are effective at lobbying

A recent McKinsey survey show that among companies whose primary market is in the European Union or the United States, less than a quarter of respondents say their companies are effective at developing and executing strategies for engaging with all relevant government stakeholders.

The results show that government actions have a significant effect on companies’ economic value: 34% of respondents say 10% or more of their operating income is at stake. Some government actions, such as providing infrastructure and access to capital, are likelier to have a positive than a negative effect on company finances. However, passing laws and setting policies—the actions executives say most often affect their companies’ economic value—have an overall negative effect. Respondents whose primary markets are in developing economies are more positive than others, however, about the effect of government actions, such as the passage of laws and enforcement of rules.

Given this value at risk, it’s promising that 71% of respondents say companies should proactively and regularly engage with government, but it’s less encouraging that only 43% say their companies actually do so.

Some of the reasons for the relative lack of engagement may be executives’ own views of government. More than 75% agree that business must be actively involved in shaping government policy to succeed and that it’s beneficial for companies to be as transparent as possible with government, but large shares also express frustration with government along various dimensions.

When companies do engage with government, executives indicate they’re not particularly good at it. Engaging with the governments of their companies’ primary-market countries is a top-three priority for only 30% of CEOs—although the figure rises to nearly 60% in China. More are involved in overseeing their companies’ efforts to engage: almost two-thirds of respondents say their CEOs either sponsor those efforts personally or oversee the group that does so.

Romanian readers may find usefull the following resource on the subject of lobbying:

According to McKinsey, the survey received responses from 1,167 executives representing the full range of industries, regions, and functional specialties.

Detailed survey results may be found on McKinsey Quarterly: www.mckinseyquarterly.com

Who benefits of lobbying self regulation?

Romanian readers may find useful the following resource on the subject of lobbying:

Commissioner Siim Kallas announced considers as a great success the fact that 2,100 lobbyists voluntarily registered themselves in the EC’s “Register of interest groups”. Is this the case?

A possible answer as well as an analysis of what lobbyists self regulation may bring to improving transparency in Romania can be found in an article I wrote for Forbes Romania (available in Romanian only):
“Who benefits of lobbying self regulation?”, Forbes Romania No. 20, 14-27 December 2009

Forbes: Demystifying lobbying, a required amendment for a moral injustice

Romanian readers may find useful the following resource on the subject of lobbying:

Forbes Romania published one of my articles on lobbying. Following the results of Rywin’s case in Poland, I focused on stating the difference between lobbying and traffic of influence and the necessity of lobby regulation in Romania.

You may read the article, in Romanian, in PDF format:
“Demystifying lobbying, a required amendment for a moral injustice”, Forbes Romania, No. 18, 16-28 November 2009

Book launching: “Lobby regulation. Inside the antechambre of influence”

C.H. Beck Publishing has the pleasure to invite you on November 11, 2009 to the launching event of the book “Lobby regulation. Inside the antechambre of influence” written by Liviu Mihaileanu and Aurelian Horja. The event will take place at the Law Faculty of Bucharest University (36-46 Kogalniceanu Blvd., Bucharest).

Besides defining the lobby activities and presenting lobbying tactics and tools, the book clarifies aspects such as the difference between lobby and trafic of influence and makes a comparative analysis of lobby regulation in USA, the European Union and EU member states.

For more information, please visit: www.reglementare-lobby.ro