Companies need to invest, rather than ignore

In the United States these days, presidential candidates are firmly opposing corporations. This trend had been going on for some time and is being magnified during the election campaign. For example, Democratic presidential candidate Kamala Harris called for cracking down on companies that raise prices due to scarcity of daily groceries (“price gouging”). There is a perception that businesses are eager for Republican presidential candidate Donald Trump to make his return to the White House. That is not the case. While Trump took a number of business-friendly policies during his first term, however, his unpredictable and often critical actions toward specific companies and CEOs raises concerns among U.S. companies. Moreover, the strengthening anti-corporate stance of other MAGA leaders has reinforced these concerns. Proposals to break up large corporations and impose hefty tax increases are among them.

Similar trends in the Netherlands: politics and business at odds

This trend is not exclusive to the US. Internationally and thus also in the Netherlands, a similar trend is visible in which business and politics are searching for a workable mutual relationship. In 2015, the then VNO-NCW (the Confederation of Netherlands Industry and Employers) chairman publicly expressed his discomfort with the rise of the right-wing Freedom Party (PVV). If the PVV grew, he foresaw consequences for foreign trade. These statements led to a cooling of the relationship between the two. Later the gentlemen evidently talked this matter out but the image remained for a long time and not only VNO-NCW, but also its member companies were called to account.

The trend results in the question: how do you as a company and CEO deal with such antisentiment of politics toward companies? Knowing that this discomfort has been apparent for a number of years. Something that was once taken for granted – a politician speaking regularly to a company or CEO – has long since ceased to be so.

Companies must respond, not wait and see

During the rise of the LPF was the first time I saw companies and their leaders make the reflex: ignore. And this continued in the following years, with political parties on the flanks or with new parties. “We don’t talk to those parties because from the Hague they have nothing to do with our customers and market anyway.” An undesirable attitude, in my opinion. Especially where political anti-sentiment, social and online traction gains and a party grows, this can quickly turn and escalate. With a consumer strike as the ultimate consequence. For example, Donald Trump who called to boycott a department store because they refused to sell his daughter’s products. Or Minister Wijers who called to avoid Shell’s gas station because of an environmental issue. So ignoring is not an option.

Bedrijven moeten reageren, niet afwachten

The rise of the LPF (this was a Dutch populist party founded by Pim Fortuyn in 2002, which quickly rose but also quickly disappeared after his assassination) was the first time I saw companies and their leaders make the reflex: ignore. And that continued in the years that followed, with political parties on the flanks or new parties. “We don’t talk to those parties, because they have nothing to do with our customers and market from the Hague anyway.” An undesirable attitude, in my opinion. Especially where political anti-sentiment, social and online gain traction and a party grows, this can quickly turn and escalate. With a consumer strike as the eventual result. For example, Donald Trump calling for a boycott of a department store because they refused to sell his daughter’s products. Or Minister Wijers who called for avoiding a Shell gas station because of an environmental issue. So ignoring them is not an option.

I still occasionally speak with representatives of companies who are reluctant to have contact with certain political parties or politicians. Of course I respect that, but it does have consequences for the influence or reputation of the company and business owner.

Strategies to manage political antisentiment

What does work to manage what is perceived as precarious dealings between business and politics? I list the three most important ones here.

First, focus on the issue, not the person. The Hague’s core business is policy. And policy is about substance, substance, substance. And not about publicly disqualifying the persons who think something. So preferably do not take an opinion about a person personally and never respond to it publicly personally. The VNO-NCW position presented on May 16 regarding the cabinet’s outline agreement is a topical example. In it, criticism and compliments go hand-in-hand. And all focused on content.

Second, invest in relationships. Today’s opposition is tomorrow’s ruling party. Quite apart from the fact that you usually get more out of a dialogue with critics than with like-minded people. Knowing that a number of political parties consistently do not accept invitations, I always recommend simply continuing to invite them. Then you can honestly say that the outstretched hand of yours is more than symbolic. In this, the relationship over the years between the SP (Socialist Party) and business, for example, has always been a striking one. In terms of content, the differences were greater than the similarities, but representatives did often attend meetings and thus remained in conversation with each other. Despite the fact that SP’ers then always referred to that on the spot as “corvey,” they were there. So ladies and gentlemen CEOs: networking is not a dirty word but just work. It is part of your job!

Thirdly, avoid hit-and-run behavior. Building substantive relationships is only meaningful if done structurally, systematically, and proactively. So don’t just show up when something important to you or your company is on the agenda. Be present also at moments that are important to the other party, or when your conversation partner is experiencing a significant or challenging moment. Don’t just focus on what you find important, but rather on what the other party needs. This may seem obvious, but I still see many companies and CEOs stuck in “broadcast mode.”

Powell Memo 2.0

In 1971, Lewis Powell analyzed the growing hostility of politicians towards American businesses and free enterprise. In this famous ‘Powell Memo,’ this future Supreme Court Justice provided concrete recommendations for businesses to act proactively, advocate for their interests, and influence the policy agenda. He suggested that companies should focus more on public opinion formation, political lobbying, and engagement with education. Over the past decades, this approach has been a catalyst for strengthening the relationship and influence of businesses on American politics. Following the U.S. presidential elections, there is a strong demand for a Powell-2 recommendation as the relationship between businesses and politics needs resetting. Companies and CEOs in the Netherlands can find inspiration in this and invest structurally, systematically, and proactively in their visibility in The Hague.