What small business needs to understand about public affairs

Public affairs doesn’t always have a squeaky-clean reputation, with headlines involving the word ‘lobbying’ often followed by some variation of ‘scandal’. Recent revelations about free tickets, clothes and a host of other jollies haven’t done much to improve things.  

But as any public affairs pro will tell you, the job is not as glamorous (nor as cloak and dagger) as it can sometimes sound. Vast chunks of it are spent in the weeds of regulatory and policy changes, responding to the often time-sensitive demands of government consultations - and that work has never been more important, for businesses of all sizes, than it is right now.  

After all, a new Labour government means new ideas, new policies, new challenges… and new opportunities. A manifesto heavy on pro-growth rhetoric but light on detailed business policy is the kind of environment that veteran lobbyists thrive in, as they help to fill the gap. That’s why London’s public affairs industry decamped en masse to Liverpool for the Labour party conference in late September; a chance to glad-hand new MPs and advisors in the evening, and hear from ministers at fringe events during the day.  

Of course, plenty of those in attendance represent bigger businesses, or agencies that work for them. The nature of public affairs, with its additional costs and not always balance-sheet-obvious benefits, means that for many it’s a function that only comes into a business after significant growth. 

But as Michael Martins, a founding partner at Overton Advisory and a former business policy advisor, notes, small businesses mustn’t miss the boat.  

“The most successful small and scaling businesses treat public affairs as a part of their growth plan and leverage that engagement to make it work for their business,” he says.  

“Small business owners should also think about the alternative scenario, where they ignore politics and policy. This usually ends up costing them more money in the long run because policymakers tend to write the rules based on what’s in front of them, so if they only see consultation responses from big companies or meet with FTSE100 CEOs, then small business owners should not be surprised when policymakers write regulations that favour larger businesses.” 

Emily Wallace the MD of Inflect agrees “ Being politically engaged is not just about lobbying against or in support of new policy or regulation, for the most part it’s about understanding how a new Government, with a new approach and a different outlook on the world might present you with opportunities (or threats) and allow you to get ahead of them. For ambitious small businesses understanding the dynamics of policy and politics on your growth and development plans can bring you competitive advantage. Small businesses are more flexible and agile and behind ahead of the game in terms of the direction of policy can help you to position yourself for the future.  

The loud voice of membership bodies 

Whilst small businesses especially in emerging technologies are signing up to agencies like Overton, others rely on the weight of membership bodies to serve their cause in Westminster. In recent years the so-called ‘Big 5’ of the Confederation of British Industry (CBI); British Chambers of Commerce; the Institute of Directors, the Federation of Small Businesses and the Forum of Private Business have been in the headlines more than ever, not always for the right reasons. But individually and collectively the groups still hold a degree of influence in SW1, and whilst not always on the same page, insiders say collaboration is more common than in decades past.  

Typically, these groups work as a kind of funnel: taking their members’ views from surveys or informal soundings, and submitting them to government both in-person and via consultation responses. Much of the really difficult work comes when policy experts comb through the intricacies of proposed legislation, often feeding back to the civil service officials behind the words. It’s a world away from the ‘lobbying’ of the public imagination, but it’s evidently valuable work. One former policy exec at a business lobby group described their job as “like a really boring MI5, in that most of the work we did stopped bad things happening. It can be difficult to justify the value to members when it’s all behind closed doors stuff, but it’s probably the most important.”  

Getting in the room, however, is the difficult bit, and public affairs pros spend a substantial amount of their working life ensuring they are still on the list. That’s a combination of what you know, and who you know.  

“If I had a pound for every time a politician or an official asked us for a meeting of small business owners, I could have retired years ago,” that same exec said. “It’s not just photo opportunities; if a minister is a bit unsure about which path to choose, they’d like the cover of saying they met supportive small businesses. Sometimes that means changing policy to ensure they find that support.” Membership bodies are always on the lookout for people within their ranks they can happily ‘put up’ in Westminster - their policy lobbying efforts are more valuable from the horse’s mouth than translated - and most of the bigger representative bodies now pack their parliamentary events with gently vetted members rather than relying purely on staff.  

Jon Gerlis, head of public relations and policy at the CIPR, said getting involved with membership bodies is a two-way street - but it isn’t the only way to get politicians’ attention.  

“Make sure you feed information and data back to them to support their work but don't be afraid to get your hands a little dirty when it comes to your own political engagement. 

“Your business will have a unique story to tell about the positive impact you are making or the challenges you are facing that your local MP and councillors will be interested to hear." 

Certainly, MPs are never too shy about photo opportunities with thriving local businesses. For Martins, that’s all part of the process. 

“The small business owners we love to work with and that get the best results recognise that politics and policy is a garden, not a grocery store. We work with small business owners to help them establish crucial relationships and credibility in their specific policy area, which is often necessary to becoming the trusted partner they need to be for the government to deliver the changes that both sides want to see.” 

What does success look like? 

Some small businesses have found more success out on their own than they have when speaking through the bigger voice of representative bodies. For one thing, those organisations are constantly balancing competing priorities, often sticking to general themes around regulation and tax rather than digging in on the detail. Smaller, industry-specific trade associations are also sometimes unable to coalesce members around individual policy areas, as they attempt to balance the sometimes contradictory ‘asks’ of growing disruptors versus larger incumbents.  

“ I would encourage all small businesses to join their trade association, they will keep you up to date with their engagement with policymakers and save you time says Emily Wallace whose agency Inflect run the Trade Association Forum, a  best practice forum for trade associations.  “it will help build your profile within your trade body if you engage effectively  with your local political representatives to make your voice as loud as possible, and give a local perspective on the sector issues that your association is making more broadly. You should get support and advice too”  

Like a good PR or advertising campaign, Martins reckons the best campaigns small businesses can run are the simple ones. His firm has been working with accountancy software platform Xero and the FSB on a late payments campaign.

“Xero’s campaign has been so successful because their policy proposals are simple to understand, backed up by evidence and data, and speak to a wider market failing, not just their own corporate interests. Xero’s work has really got them traction with and access to the new government in a much more cost-effective way that most other companies envy,” he tells us just a week after the government announced an aggressive crackdown on tardy-to-pay big business.  

Martins puts down the phone to continue his work - this time, at the Conservative party conference. They might be out of office for now; but true public affairs professionals know how quickly things can change.  

Andy Silvester is a journalist and former editor of City AM.