The best thing a business owner can do to combat a threat
is take action.
“It’s important not only to stay aware of and on top of
regulations, but to also be part of the process and part of the
policy discussions,” said Fiorentino. “You can let all those
forces impact you or you can take action. You’re either at the
table or you’re on the menu.”
Impact at every level
Business can be affected by government policy at every level.
At the local level, for example, bylaws concerning when a city
might impose noise restrictions can dictate schedules, timelines
and budgets.
“What if the local government said no noise between 10 p.m.
and 7 a.m.?” he asked. “That timing might seem logical and
reasonable. But what if they expand it to 4 p.m. and 9 a.m.?
Then things start to get different. It affects timing, it affects
the business model, it affects cost. That’s a simple example
that shows that even at the local level, pile driving can
be affected.”
At the state or provincial level, said Fiorentino, “There are
employment issues, wage rates, tax implications – all kinds of
issues at this level that could impact businesses of all kinds.”
And then at the national level, Fiorentino says taxes are
one of the biggest implications of regulations.
“For example, there’s the transition or sale of one company
to another, or a merger of one company with another or an
acquisition. Tax laws around these could negatively impact
the transactions.”
Regulations around trade can have a big impact on business
as well. He points to the current situation between the U.S.
and China as one high-profile example.
“If your equipment becomes expensive – or if it’s suddenly
non-existent because you used to purchase it overseas –
that’s going to be disruptive,” said Fiorentino. “Or, it might be
that you were selling equipment overseas and now you’re
not allowed to.” Those regulations can cause anything from a
headache to a nosediving bottom line.
The upsides of getting involved
The most successful companies tend to be well aware of the
importance of getting involved in politics and they invest
the time and effort to create a strategy to get the change (or
status quo) they’re after.
“There’s a reason Amazon, GE and some of the largest
companies in the world have Washington offices, and
government relations departments at the federal, state and
local levels,” said Fiorentino. “These companies recognize
the importance of participating in the government process
because of the negative impact it could have on their companies
if they don’t.”
He holds Uber up as an example of a company that’s used
political engagement to its advantage.
“In most local communities and U.S. states, their business
model was not allowed. But city by city, state by state the
company was able to rewrite those laws so they were beneficial
to the company,” said Fiorentino. It took widespread
diligence on a micro level to help them grow the business on
a global scale. “But to get that growth, they had to change
local ordinances and state law so they could operate the way
they do today.”
On the other hand, he says, some industries miss an
opportunity to influence policy. He points to the pharmaceutical
industry as one example.
“I’m sure there are reasons certain drugs are very
expensive,” said Fiorentino. Although, if that’s the case, it’s
not a sentiment widely understood across the U.S. “You
have to tell a story about why you feel your position is correct.”
That needs to be shared with customers, employees
and all stakeholders. “And then you can tell that story to an
elected official.”
Side benefits of involvement
“Becoming active in the government process can be a
marketing tool,” said Fiorentino. That means developing
relationships with people. “Business owners involved in the
government relations process are active in their communities.
They want to know who their representatives are and who
their senators are, who people are in their capital cities. That
puts them in touch with other like-minded people who also
have businesses.” That, he says, opens up opportunities to
participate and engage with other businesses who are active
at the various levels of government.
Can you be “too political?”
Supporting particular politicians and regulations may seem
like falling in line with one political party over another.
Fiorentino doesn’t see that as a problem, necessarily. There’s
nothing to fear when it comes to taking a political stand, he
says, as long as you clearly articulate your story.
“The owner of XYZ Company may be a fervent democrat
or republican or whatever, but if they’re a smart business
person, they’ll ask, ‘What are the business objectives that are
good for my business, good for my employees, good for my
community, and how do I look at the politics around that?’”
He adds that businesses will want to support the politicians
and issues that are best for their business, employees and
community, and allow them to prosper and thrive.
Employees, too, need to be engaged in the process.
“They should know about issues that are important to
the company, since those issues are also important to them.
That’s true of shareholders and customers, as well,” said
Fiorentino. “If issues lean one way or another in terms of a
political party, then so be it.”
Rules of engagement
So how should business owners take those first steps to
political engagement?
“First, it’s important to get to know elected officials so
they know who you are,” said Fiorentino. “To the extent you
can meet them face to face, that’s important.”
However, that doesn’t necessarily require a pilgrimage to
Washington, D.C. or Ottawa.
“All politics are local,” said Fiorentino. “Politicians come
back to their districts, their hometowns, all the time. Meet
them there. All politics start at home. That’s a good time to
meet them because they don’t have the same pressures they
might have when they’re in session.”
BUSINESS
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