Health is becoming a systemic issue, state influence is increasing, while the EU is fighting against growing nationalism - the world "after Corona" will be a different one. What does this mean for the relationship between business and politics? The hbpa expert partners have formulated ten propositions.

10 propositions on the relationship between business and politics in times of Corona

  • Corona as an accelerator: The corona crisis lays bare, in a radical manner, processes of change that are taking place in politics, society and the economy anyways. Issues such as demography, digitization, climate change or mobility were already there before Corona, but are gaining dramatically more importance through the crisis. It is now up to policymakers, business and the civil society to address these issues and come up with viable solutions.

→ In their dialogue with political stakeholders, businesses need to position themselves as part of the solution.

  • Health becomes systemically relevant: A reliable, functioning health care infrastructure is a political top priority. Thus, governments will further regulate the health sector aiming at an extension of necessary capacities (such as intensive care stations), the repatriation of pharmaceutical production as well as higher wages in nursing and care professions. We can also expect new discussions about the inclusion of digital health solutions into standard care as well as discussions about the appropriateness of lengthy approval procedures.

→ Businesses with a strong medical or health-related profile are in a position to participate in shaping the new health policy agenda.

  • Science and research as new authorities: The influence of science and research on politics has increased significantly. Experts in specific areas, such as epidemiology or climate research, can now turn the course of governments, and thus of an entire country, by 180 degrees in a very short time. Science and research are becoming the "new authority" - with far-reaching consequences for companies and their employees.

→ In the future, businesses will need to not only reach out to Members of Parliament and Government officials but also to leading researchers (who advise the government) or laboratory directors.

  • Purpose instead of profit? Even before Corona, criticism against global capitalism and its focus on profit maximization was widespread. The crisis is likely to further fuel this skepticism. Stakeholder value, rather than shareholder value is what is in demand now. Businesses are expected to fulfil a societal purpose and to contribute to a new way of life marked by respect, mindfulness and sustainability.

→ In dialogue with politics, businesses need to prove that they are committed to serving society as a whole.

  • All politics is local: Corona has exposed the instability and vulnerability of transnational production and supply chains. One solution to this problem lies in increased diversification. Technological innovations such as 3D-printing can help manufacturers reduce their dependency on production sites in other corners of the world and, as a consequence, decrease logistical end environmental costs. At the same time, with value creation happening at our doorsteps again, the relevance of local politics will be boosted.

→ Besides global trade policy, business representatives need to increase their focus on local policy issues. Reaching out to your local MP will become as important as talking to the national government or to international trade policy bodies.

  • Building trust online: In normal times, the relationship between businesses and politics thrives on physical encounters. It is through direct, personal communication that trust can grow. Now that everybody meets and talks via WebEx, Skype or Zoom, the challenge is to establish trust online.

→ Businesses and their associations need to adapt quickly to different kinds of videoconferencing and migrate proactively onto the respective professional platforms.

  • Europe – more or less? The virus has caused many governments to disengage from multinational alliances and instead fall back into national patterns. For example, due to travel restrictions on the EU-level, the so-called Schengen zone is not a borderless space anymore. Similar reflexes can be observed in other regions of the world.

→ Businesses should defend free-trade zones and agreements as the backbone of global well-being and growth.

  • New poverty: The Corona crisis is likely to cause reductions in personal wealth cutting across all layers of society. Low-income earners will be hit particularly hard. The welfare state will need to support those losing their jobs. Besides higher taxes and new levies on labor, aid schemes for those suffering due to the lock-down may result in a trade-off between additional welfare budgets on the one hand, and public funds for innovation and investments on the other hand.

→ Businesses need to make the point that additional means for welfare must not result in reduced spending on innovation, research and infrastructure. The latter are highly needed to revitalize the economies after the lock-down.

  • Keynes is back: In times of economic crisis governments increase spending and build up huge deficits. Rescue packages worth trillions of Dollars are being launched while hundreds of thousands of employees are being sent into short-time working schemes. Meanwhile, preparations are made for nationalizing troubled companies. With the state intervening massively, the free market philosophy finds itself on the defensive.

→ Businesses need to advocate free market thought and demonstrate that the prosperity of our societies largely depends on the ability of businesses to act freely.

  • Emergency – the new normal? We all hope that Corona can be contained soon. At the same time, nobody can rule out that a comparable emergency situation will arise in the near future be it another virus, a tsunami or any kind of climate catastrophe. In the worst case, the state of emergency, on various levels, will become “the new normal”.

→ Businesses more than ever have to prepare for external shocks. At the same time, or even more so, they need to keep reaching out to policymakers in order to make sure that together, government and the economy will be able to tackle the challenges that lie ahead.

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