How to lobby in PR China?
knowledge is our advantage
Mr. Glusac has a master's degree in Economics with a Master's thesis “How to lobby in PR China”.
(from Mr. Glusac thesis)
How entities working within China could and should represent their interests
Though we all refer to lobbying almost on daily basis, there are vast differences in understanding this phenomenon. Even among researchers and experts there is no single, generally accepted definition. The broadest understanding of it covers public or private impact upon decision makers by anyone. The most narrow definition, however, recognizes lobbying as an interaction between professional lobbyists and law-makers and other politicians. Interestingly enough, most people are not aware that each of us performs some lobbying in our professional and private life almost daily.
There is generally a strong bias against lobbying, as often it is identified with undue influence on public decisions in favour of some particular interest – not necessarily conducive to the legitimate public interest. Even more, many people subconsciously link lobbying with corruption. Admitting that this is not so infrequently the case, one should draw a clear line of distinction: legitimate and ethical lobbying is an important mechanism of vibrant democracies, while when corruption in any form is practiced, we are not talking about lobbying, but about crime. Since many cases of corruption remain unproven, and its perpetrators stay unpunished, especially politicians and the media tend to maintain a negative attitude on lobbying, and - for populist reasons - often exaggerate when evaluating the actual impact of lobbyists on the adoption of laws by parliaments and other public regulators. This has been proven by independent research, though for several reasons empirical research on lobbying remains rather modest. The reasons for this are that neither lobbyists, nor the organisations hiring them, let alone the lobbied decision makers, are happy to publish details about their lobbying activities.
We distinguish between three categories of lobbying:
- legal (when no law is being broken);
- legitimate (when lobbyists fully respect their association's codes of conduct);
- ethical (when public interest is not being harmed).
The maturity of a democracy can be evaluated by the relationship among these categories of lobbying being excercised in a country.
Experts are claiming that successful interest representation and lobbying takes into account the cultural and political context in which it is conducted. China is increasingly becoming the global player whom nobody being in any way active in world business and politics could afford to ignore. This article is not referring to interaction with China at the international scene, but rather how entities working within China could and should represent their interests – including by modern techniques of lobbying.
The following question is being raised: is it really that different in China, than lobbying in other parts of the world? And further: how much do we have to understand the entire Chinese cultural and political context in order to be successful in our lobbying efforts? Therefore, the article is shortly presenting the country's political decision-making structure: the Party, the Parliament, the Government, and the Army. On that basis, one can better perceive the environment in which interest representation and lobbying are conducted in this big country – where hierarchy has always been the first and undisputed principle, not for centuries, but for millennia.
What does this mean for internal and external lobbyists? Is the traditional principle of "guanxie" (connections) still as important as it was in the past? And if so, how does it work in present conditions? The genuine answer is that lots have changed indeed, but success in lobbying will still depend on whether and to what extent lobbyists have recognized and adapted to the blend between old and new in each specific case of lobbying.
Most business associations in China belong to the following two categories: chambers of commerce and industry-specific associations. The most influential chamber of commerce in China is the All-China Federation of Industry and Commerce, which primarily represents large private enterprises.
Although industry associations are often not completely independent, this does not imply that they are useless to their members. Because of China’s political environment, associations typically sacrificed part of their autonomy in order to gain recognition, access and official status, which contributes to their ability to productively serve their members.
Responsibility for liaising with the government has usually rested on the shoulders of the company’s chief owner or CEO, but in the last ten years, companies have developed specialized staff to deal with the government (Public Affairs Officers – in line with Western practice). This was introduced by multinational companies, but Chinese companies also began to follow suit. Not surprisingly, many of these officers are themselves former government and CPC officials. They may be hired to lobby their former colleagues, but it is equally likely to appreciate them for their basic knowledge of navigating the Chinese bureaucratic maze and helping in interactions with officials. The "Rotating Doors" restrictions are not yet introduced.
Business lobbying goals are also evolving, and becoming part of the usual corporate communication effort. Companies generally confront officials in ministries and commissions at the State Council. Each company will face any part of the bureaucracy that has some responsibility for issues that affect its business.
Most Sinologists confirm that lobbying has become a normal aspect of all areas of Chinese public life, including politics. At the same time, experts maintain that openness has brought about bigger accessibility of decision-makers for lobbyists, while it is not always easy to figure out who should be targeted. Therefore, the lobbying approach in China requires proper preparatory research, and this is where hiring locally-based professional lobbyists could be a justified investment. This of course isn't necessary when a foreign organisation goes together with an influential Chinese partner.
For those who are new in China, lobbying could be a major challenge. There are important differences when lobbying in China – compared to Europe and the USA.
Many of the techniques used there are applicable equally in China, though with some adjustments. Here are some general advice:
- when lobbying do not overlook the Chinese public interest;
- hiring professional lobbyists may not be as straightforward, but there are ways to engage a person (a Guangxi broker) in the relevant decision-making structures, which can be very productive;
- developing long term relations with decision-makers or relevant influential people is probably more important than elsewhere;
- involving an appropriate chamber or industry association is usually helpful;
- engaging the media is an advisable approach.
Undoubtedly, interest representation and lobbying will continue developing until reaching the same level of importance as in other major countries around the globe. This is going to offer more opportunities for lobbying by domestic and foreign entities, but it is equally likely that some specific characteristics related to Chinese culture and traditions will remain an element which could in some cases be decisive for the outcome of a particular lobbying activity.
Article prepared by: Josip Glušac, MSc and KEN Secretariat (dr. B. Cizelj).