Archive for category: Diversified Industries

Here’s What You Need To Know

As the dust settles on the election results, it is clear that regardless of the outcomes in the Georgia Senate runoffs, President-elect Biden will face the most closely divided government in 20 years, with the thinnest margins separating the parties in Congress since President Bush took office in 2000. Similar to the forthcoming 117th Congress, in 2001, the 107th Congress had a 9-seat majority in the House and an evenly divided Senate (until Jim Jeffords switched parties in May of 2001).

At first, this division seems like a uniquely challenging circumstance that will ensure continued gridlock, but history suggests that may not be the case on every issue. Indeed, closely divided government has been the norm over the past four decades, which has seen only four instances of one-party controlled government. Through all of those presidencies – even the vitriolic past four years – major legislation became law when there was cross partisan agreement on a solution to an issue that had an existing coalition of support. We saw this sort of bipartisan compromise for major legislation in 2001with No Child Left Behind, in 2012 with the JOBS Act, and most recently with 2020’s Great American Outdoors Act.

This history suggests Biden will have an opportunity to pass major legislation in his first two years in office, but what issue fits the criteria for success? While Infrastructure Week has become a running joke in Washington, infrastructure investment could provide such an opportunity for major bipartisan legislation. Whether infrastructure spending proves to be Groundhog Day for obstruction or Ground Zero for compromise depends on what the definition of infrastructure is. Here’s what you need to know to leverage this opportunity:

Is There an on Ramp for Roads and Bridges?

Earlier this fall, Congress once again punted on a long-term surface transportation spending bill. In September, after facing pressure by many leaders in the transportation industry, Congress passed a one-year funding extension for the Fixing America’s Surface Transportation Act. The extension for this Obama era bill included over $13 billion for the Highway Trust Fund and provided some certainty to states and municipalities grappling with budget shortfalls stemming from the pandemic. Hopes of a long-term reauthorization bill – which is required every five years after the last bill is passed – faded when Republicans balked at the Democrats’ $494 billion highway bill that passed the House over the summer. The main source of contention was inclusion of measures to address climate and environmental concerns.

Little is likely to change in the forthcoming Congress, as the House will continue its climate push and the debate over how to pay for the bill remains unsettled. The gas tax revenue that traditionally funds highway projects under the law has dwindled as CAFE standards lead to more fuel efficient vehicles and more hybrids and electric vehicles hit the road. That means companies and industries hoping to see infrastructure investment pass Congress will need to get creative about where such investments might focus.

Can the Digital Divide Bring Washington Together?

In his campaign plan to “Build Back Better,” President-elect Biden noted, “As the COVID-19 crisis has revealed, Americans everywhere need universal, reliable, affordable, and high-speed internet to do their jobs, participate equally in remote school learning and stay connected.” Biden pledged, “This digital divide needs to be closed everywhere, from lower-income urban schools to rural America …” The pandemic has indeed exposed and exacerbated the digital divide for both online learning to remote working, with tens of millions of Americans in both rural areas and urban centers lacking the internet connectivity to log on and join their peers. This challenge provides a unique cross-partisan opportunity for lawmakers to build an urban/rural coalition to bring high speed internet access to underserved communities. In addition to President-elect Biden’s plan, Senators John Cornyn (R-TX) and Joe Manchin (D-WV) have introduced the Eliminate the Digital Divide Act.

Delivering high-speed broadband to underserved urban and rural communities would positively impact agriculture, healthcare and educational outcomes while opening up more opportunities for more workers to work remotely. Of course, reaching bipartisan agreement on the goal does not mean the debate is settled. From how to pay for broadband rollout, to whether a return of net neutrality rules discouraging private sector investment, to what equipment can or should be used in 5G networks – not to mention by whom and how those networks should be built – remain to be settled. 

The Energy Transition Has To Be Built Before It Can Happen.

President-elect Biden has made clear he will move aggressively to address climate change in his Administration. While much of those plans will face opposition from Republicans – and even some Democrats – on Capitol Hill, some of his plans may find bipartisan agreement. Biden’s vow to add 500,000 public charging stations for electric vehicles to highways and roads across the nation provides business opportunities for EV manufacturers, utilities, and charging equipment and service companies. These private sector entities are all hoping to lead the way in filling the “range anxiety” inducing void of charging stations across much of the country. However, regulators have to let them do it. Meanwhile, efforts to phase out internal combustion vehicles have begun cropping up. In California, Governor Gavin Newsom recently signed an executive order that prohibits the sale of new internal combustion vehicles in the Golden State after 2035, and regulators in New Jersey recently recommended the state adopt similar measures. However, such moves require enough places to “fill up” citizens’ EVs.

Beyond his plan to accelerate the nation’s transition to electric vehicles, Biden has emphasized his ambitious plan to invest heavily in renewable energy infrastructure for both economic stimulus and emissions reductions. Such plans could be hindered by Republican skepticism as well as progressive demands. Renewable infrastructure requires a range of approvals, like any other such project, and Biden will face progressive pressure to return environmental regulations that were reduced by the Trump Administration to ease infrastructure reviews and approvals. In addition, renewables such as wind and solar remain intermittent power sources requiring peak demand support from natural gas powered plants and other existing energy fuel sources until such time as battery storage technology can mature. As Sen. Lisa Murkowski (R-AK) has signaled, while Republicans seek to protect domestic oil and natural gas production, they could support federal spending to boost research and development of wind and solar technologies, as well as investments in smart grid and electric vehicle infrastructure. However, such support is likely to require the Biden Administration to recognize some of these realities. 

Success Doesn’t Happen by Accident.

As we approach the next Congress, savvy public affairs professionals are preparing for the coalitions of strange bedfellows that may emerge to reach a bipartisan consensus on key legislation. Shaping the debate to advance your infrastructure initiatives means understanding the full range of stakeholders involved in policy discussions while mapping out the operating landscape to gauge potential emerging consensus. As always, Delve is here to provide the insights you need to see around the corner and anticipate any risks or opportunities.

Here’s What You Need To Know

Coronavirus has changed so much about how we live our lives – and many of those life modifications just may turn out to be permanent. Perhaps the most significant of these changes is the shift among businesses to allow more work to be done remotely. While time-honored traditions like the business lunch may return, many Americans are eager to cling to one particular aspect of the new way of working: teleworking. In fact, 6 in 10 respondents told Gallup pollsters they’d like to continue working from home after the coronavirus crisis is over.

As companies become more comfortable with allowing telework, however, they are finding a surprising reality welcoming them. While some of those surprises are pleasant, such as the increased productivity of remote workers and greater flexibility for parents balancing work with “Zoom school,” there are also unpleasant surprises as companies learn more about the confusing tangle of state and local regulations and unexpected costs awaiting them when employees can work from anywhere.

So before public affairs professionals celebrate their companies’ decision to move all operations offsite or allow employees to work remotely, here’s what you need to know to ensure the decision does not come with unexpected costs and compliance challenges thanks to regulatory regimes still largely based on a business’ physical footprint that is increasingly inapplicable to the future of work.

Covid-19 Showed Employers Productive Telework Is Possible, and Employees Want To Keep the Flexibility

The Big Shift: In 2014, just 6 percent of respondents told Gallup they worked at least 20 hours each week from home. By the time pandemic shutdowns began nationwide in mid-March 2020, 31 percent of Americans were working remotely. In the weeks that followed, that number doubled. According to Pew Research, 90 percent of those who lost jobs due to COVID-19 shutdowns worked in industries or for organizations where telework was either not permitted or impossible. For Americans able to work virtually, technology provided job security – jobs they might have otherwise lost if Internet-based tools were unavailable. For employers, the promising results of this great remote work experiment means many are thinking employees could live anywhere, reducing relocation costs and expanding the talent pool nationwide.

Now What? With a return to normal appearing slowly on the horizon, organizations are preparing for what a future with reduced in-person office presence would look like. According to CNBC, 43 percent of employees said they would like to continue teleworking permanently. Employers sensed this trend, and by late March, 74 percent of company executives interviewed by Gartner said they anticipated at least 5 percent of their company workforces would telework after the pandemic concluded.

Indeed, many organizations have already begun that transition for great numbers of their employees. Most notably, Facebook, which had once given $10,000 bonuses to team members who lived within 10 miles of their offices, says it will now permanently shift tens of thousands of its employees to remote work. Other tech companies like Google, Twitter, and Shopify have also announced making virtual collaboration from home permanent, and because the industry often sets trends for top employers across the nation, many more will likely follow suit to compete for the best talent. However, as organizations cast a wider net in their recruiting and retention strategies, picking the best candidates from far and wide, there are hidden costs and complexities that may surprise them.

Before Moving Operations Online, Organizations Should Anticipate Compliance Costs and Confusion

Postcards from Paradise: Now unbound from their offices, teleworking employees have the opportunity to pick where they live, not based on where a job may be but on where they want to be. While employees may move to the Florida Keys or atop a mountain in Montana, their mobility comes at a price to their employers. The new virtual workspace will require organizations to be familiar with the rules governing a myriad of potential residences of their employees, both current and future. Benefits like workers’ compensation, disability insurance, and unemployment insurance vary wildly from state to state. So, too, do licensure and business registration requirements, which often are not clear because they were written for a physical world of business with storefronts and official offices, not for a virtual world. Organizations will now have to look into whether or not they’re required to register in each state where an employee lives, which means that 12 employees living in 12 different states could potentially necessitate 12 different registrations, with such costs rising exponentially and unexpectedly for employers.

Even More Tax Men Come Calling: Another complication facing organizations considering virtual work options are the vastly different tax structures for different states and municipalities. Some states, like Texas and Florida, do not have state income tax. Then, there are issues with sales tax, as rates and what is taxable can differ wildly from locality to locality. These considerations include not only e-commerce transactions but also state and municipal sales taxes imposed on service-based offerings such as consulting or digital subscriptions. Still other locations have different withholding and pay stub requirements.

All of these can leave human resources and accounting departments scrambling to ensure they are constantly in compliance with thousands of different tax conditions simultaneously. When all the accounting is complete, many companies will face a shocking uptick in taxes owed and compliance costs – expenditures for which they might not have budgeted prior to a remote working shift. Indeed, many organizations choose their operating base on a location’s tax and regulatory environment. With team members scattered across the country, these considerations are no longer in the hands of corporate officers, but of employees who are moving with other considerations in mind.

Jurisdictional Confusion: A persistent concern among employers remains the correct application of rules that depend on number of employees within a firm, office location, or certain jurisdiction. For example, the Family Medical Leave Act (FMLA). Current regulations say that in order to receive qualified medical leave, an eligible employee must be “employed at a worksite where 50 or more employees are employed by the employer within 75 miles of that worksite.” This complicates matters for teleworking employees, whose employers may think that they are not covered by FMLA if they live elsewhere.

According to legal experts at Lowenstein Sandler, LLP, however, the employee’s worksite “is the office to which the employee reports and from which assignments are made,” not where the employee lives. “So, for example, the lone Massachusetts employee who works from her home, but who receives all of her work assignments from her supervisor in New York where the company employs more than 50 employees, may be eligible for FMLA leave,” Lowenstein explains, adding, “State leave laws may impose additional leave obligations upon employers.” Multiply that across various jurisdictions and a plethora of federal, state, and local work rules, which often conflict with each other, and companies shifting to remote work could face considerable legal and regulatory confusion.

Despite a Few Emerging Solutions, Policymakers Are Still Applying 20th Century Rules to 21st Century Work

Practical Solutions: In one of the country’s regions most devastated by coronavirus, business advocates have come up with solutions to navigate each state’s tax laws for employees working from home. There’s a growing movement in the tristate area of New York, New Jersey, and Connecticut to allow for reciprocity, so employees can avoid paying taxes in multiple states as they work from home for an extended period. Illinois already has a similar arrangement with nearby states, so employees working there but living in Kentucky, Michigan, Wisconsin, or Iowa may pay taxes where they live. Employees across America may soon demand the Illinois model, especially if they reside in states with low or no income tax but work in states that charge it.

20th Century Rules Meet A 21st Century Workforce: Most of the rules and regulations governing labor in the U.S. originate from 20^th century practices and standards. However, the future of work was changing even before the pandemic, and with the American workforce increasingly going virtual, compliance requirements must change, too. This leaves organizations in a tough spot: their workforce demands the kind of flexibility that working from home provides, while the laws and regulations make delivering these benefits difficult, time-consuming, and expensive. As companies try to adapt while maintaining compliance, mistakes are inevitable, leaving them exposed to reputational and legal challenges.

No More HQ2 Competitions? This shift to a more remote workforce could also add complications for states, counties, and cities, who for years have wooed businesses to their territory for the promise of tax income and jobs. Now, employees can vote with their feet, regardless of where the business chooses to locate its headquarters. This shift in power dynamics means something like the Amazon HQ2 competition may be a relic of the past.

Work from home is here to stay, and in the months ahead, we will discover just how many Americans will maintain their telework flexibility. As organizations modify their practices to accommodate this trend, they will have to navigate a compliance landscape that is more complicated than they may have realized. They will also need to consider new challenges that can arise as a result. By understanding these challenges ahead of time, leaders will be able to save themselves time, money, and headaches while creating a safe, desirable workplace that keeps current team members happy and recruits the best and brightest, too.

Here’s What You Need To Know

With work and leisure plans suspended due to coronavirus, many Americans have canceled their flights or delayed future travel. According to Transportation Safety Administration (TSA) data, the number of passengers clearing TSA at airports each day fell from 2,122,898 on March 10, 2020 to just 124,021 by April 2,2020. Conde Nast Travel estimates there was an overall 95 percent drop in flying in the U.S. by mid-April, with more than half of all planes grounded at the height of the pandemic. In May, three small airlines shut down their shuttle service, which means that fewer short distance flights are now available to consumers, even as major airlines suspended operations in key markets.

Unfortunately, as we enter what would traditionally be the summer travel season, the pain felt by airlines is just beginning. Industry experts say current hardships are merely a harbinger of what is to come. Despite significant growth leading up to the pandemic, industry representatives say they “anticipate a long and difficult road ahead.” Airlines for America points out that it took three years for the industry to recover from the 9/11 terrorist attacks and more than seven years to return to normal after the 2008 financial crisis. With an unprecedented public health crisis whose remedy remains unclear, the industry must brace for years of financial uncertainty as customers continually assess the health risks of flying.

These challenges affect not only airlines but also the airports and businesses who support them. As air traffic lags, so, too, does the recovery for these elements of the air travel sector. Here’s what public affairs professionals working in this field need to know to prepare for the unique challenges posed by the “new normal” of air travel.

As Air Travel Returns, New Health and Safety Policies Create Risk of Another Kind of Viral Moment

Consumers Remain Concerned About Virus. Even as airlines institute new policies they say will ensure the safety and well-being of their customers, consumers may not be convinced these measures are enough. According to The Wall Street Journal, 85 percent of travelers now say cleanliness in airports and on airplanes would affect their decision to travel – as high a factor as ticket price. Industry officials say this is the first time they have seen any customer consideration factor as much as cost. As coronavirus infection rates ebb and flow, so, too, will customers’ willingness to go to airports and fly on planes.

Uneven Masking Rules Create Confusion – And Potential For Clashes. For those customers who elect to fly, the uneven application of masking rules can be very frustrating, leaving some worried about their safety on-board and others angry about the new requirements. These fears are exacerbated by the diverging policies among U.S. airlines, as some require face coverings only at boarding while others mandate consistent wear throughout the flight. There are also concerns about a lack of social distancing on some flights, since airlines are canceling many of them and as a result, some airlines are packing remaining flights.

Are Airlines Ready For Their Close Up? Airlines must also develop procedures to handle customers who refuse to adhere to coronavirus guidelines. In May, American Airlines began instructing their staff to avoid escalation with passengers once they have boarded by informing them of the masking policy, rather than actually enforcing it. Conversely, American Airlines, Jet Blue, and Hawaiian Airlines have said they are prepared to ban, whether temporarily or permanently, any customer who does not adhere to the airline’s masking policy. In the midst of current social unrest, passengers-turned-documentarians are just a single viral video away from creating a real public relations nightmare for airlines. This puts pressure on airline personnel who must stand ready to pacify customers irritated with each other and with the airlines themselves while simultaneously maintaining the safety of all on-board. Outbursts that disrupt travel could create reputational challenges all too familiar to the airline industry.

Social Distancing Comes At A Cost. While some airlines have created new systems to allow space in between seats, this accommodation can come at a cost to customers. Frontier Airlines faced blowback from members of Congress as it attempted to charge passengers an extra $39 fee to sit in a row that had no middle seat, ultimately rescinding its plan after federal lawmakers intervened. Now, American Airlines says it will start flying at full capacity next week, abandoning social distancing guidelines that kept middle seats empty and more space between customers.

Federal Support Brings New Scrutiny on Worker and Consumer Protection, and Renewed Climate Demands

CARES Act Saved Airline Jobs, But For How Long? With historic losses in passengers and profits, the airline industry secured financial relief in the CARES Act, which provided airlines $25 billion in taxpayer support under the conditions that they “keep at least 90% of workers employed through September, they will return one-third of the funds they receive, suspend stock buybacks and dividends, and limit executive pay.”

However, airlines are now acknowledging that after the September 30^th deadline passes, many are planning to lay off employees. Philip Baggaley, the chief credit analyst for airlines at Standard & Poor’s, tells CNN he anticipates 95,000 to 105,000 jobs lost across the U.S. airline industry this fall. News from American Airlines supports this expectation, with the airline giant saying it will cut its management and support staff by 30 percent, or about 5,100 jobs. While these job cuts are a reality of lessened consumer and business demand for flights, it will still cause scrutiny and challenges for airlines that received taxpayer support with the expectation it would protect workers.

No Refund For Consumers Even As Taxpayers Foot The Bill. Missing from the legislation was any redress for customers whose flights had been canceled in response to the pandemic. Passengers instead have been offered vouchers with strict terms and potentially unrealistic expiration dates. So, while taxpayers foot the costs of industry relief, many have not been made whole for their canceled plans. Angst directed toward airlines for failure to return money to customers could compound frustrations towards companies that existed long before COVID-19 halted air travel – and had already spurred demands for new or expanded legislation to protect consumers.

And Don’t Forget Flight Shaming. In another source of scrutiny for the industry, during the CARES Act negotiations, some Democrats sought to force airlines to adopt more aggressive green initiatives to combat climate change. While such conditions were not ultimately included in the legislative package, climate change pressure on the industry began well before the pandemic began, and demands to enact carbon emissions offsets or reductions are likely to continue, driving up the costs for airlines and passengers when neither can afford it. Should the November elections shift party control in Washington, airlines can expect such demands to be renewed with a fervor.

Struggling Airports and Related Services Are Pushing for Their Own Relief, Even if It Means Higher Taxes for Travelers

Airport Struggles Could Lead To Tax Hikes. The pandemic has not only affected airlines, but also the airports and businesses who support them, too. According to the Airports Council International, airports worldwide are expecting a decline of more than 4.6 billion passengers, creating a $97 billion revenue loss for airports. In fact, airports have already lost nearly $40 billion in revenue. Despite receiving $10 billion in the CARES Act, airport revenue losses have already put large construction projects on hold. Because airports are typically funded through the combination of airline fees and taxes, this dramatic drop in air traffic could mean that airports may seek additional bailouts, or absent that relief, potentially seek local tax increases to recoup their losses. However, airlines are quick to point out consumers already pay nearly $7 billion annually in airport taxes, often as part of the ticket prices they pay.

Restaurant And Retail Concessions Hope To Board The Next Relief Bill. Meanwhile, airport restaurants and retailers say that the 95 percent decline in passengers in recent months have left them financially insolvent. “We’re trying to tell Congress that ‘You missed us. You totally overlooked concessionaires.’ We’re hoping and urging that they will provide relief,” Rob Wigington, executive director of the Airport Restaurant and Retail Association, said. To that end, these organizations are now asking Congress to ease the burden of just $38 million in April 2020 sales, compared to $825 million during the same time last year. The association, which represents companies employing 125,000 concession workers, says that just 5 percent of its workforce remained employed by May and that it would need $5 billion in loans and grants to stay afloat. Right now, additional coronavirus relief bills remain in flux, so industry representatives must urgently make the case they should be included.

The Airline Travel Industry Can Fly Right With an Information Advantage

While the $25 billion airline relief in coronavirus legislation was a victory for the industry, there are still many obstacles ahead. From hygiene on-board to fewer passengers in the skies and in the airports, the air travel industry must be prepared to convey their commitment to customers and their willingness to adapt to the new way of travel while navigating heightened reputational scrutiny. With competitive intelligence, public affairs professionals in the industry can anticipate and mitigate these risks while advancing the interests of their companies’ and coalitions’ efforts to keep Americans at work and in flight.

Here’s What You Need To Know

Fake news. Disinformation. Russian bots trolling on social media. The common narrative being echoed throughout the media is that this year and beyond, consumers of information are going to have to scrutinize stories and sources to make sure that the news they’re viewing is a true representation of events – rather than a made-up or entirely obfuscated piece of clickbait. But what if seemingly well-intentioned reporters at reputable organizations run stories misreporting events, stating opinions as facts, or otherwise misrepresenting developments?

The answer may well be a key paradox of 2020: the real challenge is not how widespread the fake news is, but rather how fake the real news can be. For public and government affairs professionals who need to stay on top of information flows and leverage insights gleaned from news items on behalf of their companies and organizations, the struggle of dealing with fake news is real. How can you process developments and create and execute strategies to further your priorities if you cannot be certain that data used to make decisions is accurate?

Particularly over the last few years, there have been examples where the conventional thinking and widely reported narrative in the media has been incorrect on consequential issues including trade, taxes, and geopolitics. Here are a few story lines of interest to the private sector where the media largely got it wrong:

• America First In Trade Leaves America Alone. The Administration’s approach to trade policy has been a notable departure from its predecessors in both parties, of which the President’s criticism of NAFTA, rejection of the Trans-Pacific Partnership, and use of tariffs and trade wars are prominent features. However, if the news led some to assume that this approach would “assault the global trading system,” spur a market correction, and isolate the U.S. on the world stage, the reality appears different. Irrespective of the substance of specific policies, the U.S. remains engaged, signing a new trade agreement with Japan, negotiating the USMCA with its continental partners (which won strong bipartisan backing in the Democrat-controlled House just hours after the chamber voted to impeach the president), and last week signed a phase one trade agreement with China. Particularly on the latter, the Administration’s policy has been widely criticized, with heightened tensions between the two countries possibly leading to what Henry Kissinger called a “catastrophic outcome.” Yet, a purportedly “impressed” Kissinger was in the front row of the signing ceremony and earned a special mention from President Trump, the president’s tough stance against China is credited by some to have forced China to make a deal, and the higher costs for consumers the media kept warning us about largely haven’t materialized.
   
• Tax Reform Will Suffer The Same Fate As Replacing Obamacare. Having failed to repeal the Affordable Care Act in early 2017, the united Republican majority was expected to run into the same challenges when undertaking tax reform later that year. Whether for lack of clear policy goals or obscure Senate rules, tax reform was given little chance to succeed. When tax reform became law, it was then widely reported that the plan would benefit the rich at the expense of others, although the overwhelming majority of filers got tax relief. Today, the effects of the law continue to enable strong economic growth, with recent data now indicating that wages are growing fastest among workers currently employed in low-wage jobs. For those of us involved early in the process of Trump’s tax reform efforts, there were clear distinctions between the two fights and their likely outcomes. But in the media, no such distinctions were made, making it that much harder for those relying on media reporting to understand what would really happen.
   
• Peace Through Strength Or World War III. The removal of Iranian General Qassem Soleimani by U.S. forces immediately set off fears of an impending third world war, representing “a serious threat of increased violence” in the Middle East, as outlets as varied as Teen Vogue noted. Such stories, though, assume that tensions between the U.S. and Iran (to say nothing of broader diplomatic and kinetic tensions between other countries in the region) are lower before the strike than after, and the U.S. and Iran are not currently engaged in all-out war. Interestingly, the strike appears to have inspired Iranians who have been protesting the regime, and rather than eliminate dialogue, has opened up new avenues for the U.S. to engage with the country, appeal to moderate elements, and even propose negotiations to create a new nuclear agreement with the country. The overdone media predictions were similar to early media predictions regarding Trump’s pressure on North Korean dictator Kim Jong Un, and those predictions met a similar fate.

The narratives above are just three examples of recent, consequential policy issues that were the subject of much conjecture by the news media and that turned out quite different in reality. Yet this phenomenon is not limited to Trump – remember when the media was overwhelmingly certain Beto O’Rourke would be the Democratic nominee in 2020? Nor is it a distinctly American challenge – remember when Brexit would devastate the U.K.’s financial sector?

Sadly, this phenomenon will not abate even if Trump were to lose the election this coming November because it is a symptom of our current media age, and a symptom that must be addressed in a serious and meaningful way if the press is to regain its footing as a crucial institution underpinning democracy. If not, the result could have dire implications. As Axios(unironically and seemingly without self-awareness) noted recently, “If the 2020 presidential election is close enough to trigger a fight over the results,” which is a real possibility, “the public’s confidence is so low in key people and institutions [including the news media] that no one is likely to be a trusted referee…”

In the meantime, while the merits of the specific policies and decisions will continue to be debated from all parts of the political spectrum, the disconnect between today’s media assessments and tomorrow’s reality clarifies the challenge facing policy professionals. In addition to facing information overload, tracking more policy issues than ever, and being crunched for time, government relations and public affairs professionals have to identify the real signal from the fake noise in the news media. This “fakeness” of real news means companies and trade associations will need to rely on a range of primary and secondary sources when monitoring developments in order to gain a more complete and accurate picture of their operating environments and the key trends impacting their interests.

Better insights lead to better strategies, better decisions, and a competitive information advantage in achieving your policy objectives. To learn more about how Delve is helping companies and trade associations navigate their public affairs challenges at a time of fake news and suspect real news, contact us.

News You Can Use

THE SHARPENING EDGE OF ADVOCACY

In case a breakdown of civility wasn’t making life difficult enough for public affairs and advocacy professionals already, a new blurring of the personal and the professional means new risks for companies and organizations engaging on public policy issues. This month, a European strategic communications professional who is undergoing treatment for cancer was attacked by a public health advocate through Twitter direct message. The reason? Because the communications professional’s firm has worked on behalf of tobacco companies.

The episode illustrates the impact today’s toxic partisanship and zero-sum nature of professionalized and energized issue activism are having on the policy and advocacy climate. As more public policy fights get personal, individuals at companies and industries – whether they work on policy issues or not – are at greater risk for political and reputational challenges, creating the need for a new approach by the employers to protect not only their brand’s and industry’s reputations, but their employees’ as well. It also means more employees asking tougher questions about their firms’ political and policy positions.

K STREET’S ACTIVISM ADAPTION

With presidential candidates voicing proposals that could become policies, K Street is already buzzing to influence policy outcomes and minimize risks for their clients. One instructive way they are doing this is by conducting “deeper outreach to think tanks, academia and other institutions that can lend policy gravitas to shape major discussions” over key issues. Such institutions offer an “alternative voice” that serve as the basis for legislation and that “candidates, lawmakers and voters alike may be willing to hear rather than corporate interests,” largely due to the anti-business messaging from professionalized, digitized, and nationalized activists.

This outreach and other “workarounds” highlight the increased risks facing corporate interests as issue activism becomes more prominent, and showcases the changed nature of today’s operating environment for government affairs professionals. Rather than simply traditional outreach and advocacy to contacts on the Hill, understanding and examining the range of stakeholders outside of government influencing the policy discussion on your issue set has become more important than ever.

LENDING A(I) HUMAN HAND

The “robot revolution” could impact more than just blue-collar workers and include “knowledge workers” as well, according to a new study by Stanford University economist Michael Webb. But, perhaps more interesting is what the study says about the nature of the potential displacement caused by artificial intelligence (AI).

While the study warns that white collar jobs could be displaced by automation, some experts point to factors that might mitigate that possibility. Some AI patents, for example, “might never be used,” while others “might not be used for their initial intentions.” Notably, these technologies might also be used to “augment jobs rather than supplant them.”

One hedge fund investment analyst explained, “There’s a reason there’s not more unemployed hedge fund analysts: Because you do still need that human hand,” he added, “at least for the time being.” When it comes to competitive intelligence for public affairs, our clients echo this sentiment: trained analysts using sophisticated technology provides an information advantage.

AL GORE’S INTERNET MISHAP

If Al Gore really invented the internet, there may be an inconvenient truth he’ll have to face. According to The New Republic, the internet is “inextricably tied to the coming horrors of the climate crisis” and is “the largest coal-fired machine on the entire planet, accounting for 10 percent of global electricity demand.” It’s not simply the attention toward the web’s electricity usage that makes this assault against modernity concerning however, but that companies running ads on the internet – from news outlets to small businesses – risk getting caught up in the political and reputational challenges stemming from environmental activism’s focus on the electricity required to run such ads.

With Bernie Sanders’s proposed plan treating the internet as a “utility that will very much be affected by the climate crisis” and in-house experts at activist groups such as Greenpeace already shaping what the future of a greener internet may look like, the internet as the next climate change culprit has begun. Not only does this trend risk commerce, communication, and promising advancements in innovative frontiers such as telemedicine, but demonstrates the unrelenting and unreasonable nature of today’s environmental activism that can focus its attention and scrutiny anywhere.

Here’s What You Need To Know

Extreme partisanship. Unrelenting information flows from traditional and digital media. A blending of corporate interests and politics. Today’s policy landscape is more decentralized and complex than ever. Policy professionals tasked by companies, trade associations, and public affairs firms to achieve objectives are constantly navigating this operating environment rife with uncertainty. In the words of one Senior Vice President of Government Affairs: “I’m no longer dealing primarily with policy issues related to my company’s industry. My firm asks for my help with everything from gun rights to labor issues and investor relations. We weigh in on more business decisions than ever before.” How can you ensure you’re prepared to weigh in on more issues than ever when 53% of policy professionals’ biggest challenge is managing information overload?

That’s the question raised by the data in Politico Pro’s recently released “Policy Professional Benchmark Report,” which was compiled from more than 1,400 interviews with policy and public affairs professionals to provide an in-depth look at the challenges they face. Given Delve’s expertise in culling, analyzing, and synthesizing data into actionable insights for our corporate and industry clients, this data was no surprise to us. As the Politico Pro report illuminates, policy professionals are in the midst of adapting to these key challenges:

• From Heightened Social Issue Activism To Expanded Corporate Stakeholder Expectations, Policy Professionals “Weigh In On More Business Decisions Than Ever Before.” Regardless of whether it chooses to engage on political issues and values or not, the C-suite is more interested than ever in matters of public policy. Policy professionals face increased pressures to add value as social issue activism and heightened expectations regarding corporate social responsibility from investors and the public push them outside of their comfort zones. As evidence of this need for counsel, more than half of those policy professionals surveyed are meeting with general counsels and business unit leaders on a weekly basis, including 60% doing so with a CEO. Where decision-making was once based on traditional modeling, competitive market intelligence, and rigorous analysis, competitive intelligence through the lens of public affairs is now in demand.
   
• Policy Professionals’ “ Biggest Challenge Isn’t A Lack Of Information, But An Overflow Of It.” Policy professionals have an incredible amount of information at their fingertips and 53% of those surveyed by Politico Pro list their top challenge, from “keeping up with it all” to being able to “process and synthesize” it, as managing information overflow. Increased uncertainty and a dispersion of policymaking have only fueled this overload, as professionals are called upon to provide guidance to stakeholders on legislative and executive developments in Washington, new regulatory frameworks implemented in the European Union, policy measures at the state and municipal levels, and more. There is little time to stay on top of developments, let alone process them to discern what they mean for your organization and how to leverage them to your advantage. And with all due respect to Politico, the news these days is more often heat than light, making it difficult for policy professionals to rely on news outlets to separate fact from speculation and opinion.
   
• “Searching For Information” Is Policy Professionals’ Top Category Of Time Spend. Forty-eight percent of public affairs pros spend most of their time researching and searching for information, and that doesn’t include analyzing – let alone packaging and leveraging – such information and doesn’t leave enough time to do so. Given the quick pace of change across so many jurisdictions, it is “almost impossible” to keep up, let alone find time to translate it into actual advocacy work that moves the needle for your organization.

So how can public affairs and government relations professionals adapt to this new operating environment? Leveraging our expertise here at Delve, we have a few solutions:

• Understand And Get Ahead Of Political Risks. The expertise of policy professionals is invaluable to executives, particularly when companies are only a viral moment or tweet away from a boycott or crisis as professionalized social issue activism continues to rise. Because of the array of issues and risks, understanding first an organization’s overall political risk and its own vulnerabilities can help policy professionals proactively outline policies and processes for engaging (or not) in the public arena. Once known, such insights can also help proactively inform advocacy efforts.
   
• Focus On Insights Over Noise. Seventy-three percent of policy professionals are increasingly turning to intelligence tools “to find information more quickly,” and advances in technology from social media listening platforms to free tools such as keyword alerts and aggregators offer policy pros many options. However, these do-it-yourself tools can lead to even more information overload, and do not provide meaningful analysis or key trends that point to what happens next, making it difficult to derive actionable insights from their information flows. That is why when evaluating new tools, policy professionals should consider whether they deliver competitive intelligence and analysis that gives their organization an advantage, or simply add to information overload.
   
• Engage A Force-Multiplier. “Surprise has become standard” does not have to be your organization’s new normal. Engaging a strategic partner to help reduce the time spent on researching, monitoring, and analyzing information can serve as a force-multiplier for an organization’s public affairs team. As the Politico Pro report noted, “All this time spent translating policy internally constrains policy professionals’ availability to influence stakeholders beyond their organizations.” A strategic competitive intelligence partner can ensure policy professionals’ time is invested in leveraging key insights, meeting with internal and external stakeholders, and other high-yield functions.

Challenges are often paired with opportunities. Corporate interests engaging in the public policy environment are continuing to evolve to address the challenges above, and innovative approaches, services, and partnerships are changing the way public policy is done. If you’re interested in discussing how your organization can build a more effective approach to succeeding in today’s uncertain landscape, and hearing more about the work Delve does to put policy professionals at an information advantage rather than an information overload, reach out to us.

News You Can Use

ANTI-MONOPOLY PASSES GO

Facebook co-founder Chris Hughes is spearheading a $10 million “anti-monopoly” fund that is hoping to “shine an effort on competition” and, Hughes says, “move the issue from the margins to the mainstream.” His old company isn’t the only one that should take notice, and we’re not just referring to other members of big tech.

Hughes and his allies view the interest surrounding tech as an opportunity to galvanize into a “broader movement to analyze, regulate or dismantle behemoths in agriculture, healthcare and other industries” in which they believe customers are hurt by a lack of competition. With the funding going to like-minded academics, policy advocacy groups, and grassroots activists that engage on the ground, industries beyond tech such as health care, pharmaceuticals, agriculture, financial services and more will need to prepare for this effort and the networks of influence stemming from it.

DRINK WITH YOUR FEET?

It turns out people may not only vote with their feet or their wallets, but drink with their feet, too. A recent study on the effects of Philadelphia’s soda tax provides new data regarding how consumers respond to taxes on the everyday choices they make. Unlike previous studies that centered on Berkeley’s soda tax, Philadelphia’s large and diverse population provides a more complete picture of the policy implications.

Advocates of soda taxes, whether to increase revenues or improve health or both, may find the results dismaying: soda purchases declined 46% in the city, but sales of soda increased in stores bordering the city, and sales in lower-income neighborhoods remained similar. This data suggests that not only was there no meaningful positive health outcome or increase in tax revenues, but that the tax ultimately targeted those who could least afford it. While the research team proposed a broader taxing area to address these shortcomings, it does not change the reality that people appear to drink with their feet, and that ill-conceived policies often hurt those who can least afford them.

FED UP WITH PHILANTHROPISTS

Successful philanthropists have given much time and money to create and sustain America’s great cultural institutions, yet despite the good they have done in this realm (not to mention the benefits for workers and investors in their successful businesses), professionalized activism is coming for them. Patrons such as Warren Kanders was “run off the board of the Whitney Museum of American art” because his company supplies the U.S. border patrol, and BlackRock CEO and Museum of Modern Art Board Member Larry Fink is being pressured by activists wanting to “ride off the tails of the Whitney action” to change his company’s investments to suit their agenda.

For philanthropists and the organizations who depend on their involvement and generosity, this activism presents new reputational risks that will need to be addressed. In the case of the former, it would appear that shared values, cultural and civic service, and vocal, socially conscious capitalism cannot keep activism at bay. As to the latter, organizations dependent on such benefactors may expect more public scrutiny from activism relating to their boards, creating a new need to better understand the risks and vulnerabilities that can be used against them by determined activists.

COMMENT FRIENDLY

At Delve, we’re well-versed in the jungle of the federal rule-making process, and particularly the too often spurious nature of public comments that are repetitive, vulgar, fake, or irrelevant. In the latest development regarding fraudulent comments on the regulatory docket, the Senate Permanent Subcommittee on Investigations released a bipartisan report finding that “federal agencies do little or nothing to stop crimes and abuses committed in the systems they use to collect public comments on proposed regulations.”

Whether a person’s identity was stolen, a false name was used, or comments were laced with profanity, the comments can “corrupt the public-comment process, mandated by law, which can influence outcomes of regulations affecting millions.” Often, interests advancing their policy goals create astroturf campaigns which can employ fake comments. Subcommittee Chair Sen. Rob Portman (R-OH) has recommended changes to the laws governing rule-making processes, including this one: “clarify that agencies should not accept or post abusive, profane, or threatening comments; irrelevant comments; or comments submitted under a false identity.” If only it were that easy.