GMGT 7740 (A01) BUSINESS GOVERNMENT RELATIONS Session 1. Agenda: Session 1

Transcription

1 GMGT 7740 (A01) BUSINESS GOVERNMENT RELATIONS Session 1 February 14, 2012 Instructor: Anita Kampen Agenda: Session 1 Perform Class Introductions Provide Course Overview / Expectations Form Teams for related Group activities Explore the Contextual Environment Introduce Business, Government, Governance Sectoral similarities / differences Independence, Influence, Interdependence Class Debrief and Assignment Prep 1

2 Introductions (In Groups) Why are you here? How do you like to learn? What strengths do you bring to the course? What is the relationship of this course to what you have learned so far? Overview/ Expectations Course Expectations: Readings (refer to Course Outline / Course Notes) Assignments (refer to Assignment Package) Individual / Group Preparation and Participation Conduct: Attendance Punctuality Academic Integrity 2

3 We're in a giant car heading towards a brick wall and everyone s arguing over where they're going to sit. -David Suzuki A LOOK AT THE CURRENT LANDSCAPE World Economic Forum (WEF) Global Agenda The Global Agenda YouTube.url The Global l Economic Outlook Global Power Shifts and Emerging Markets Inclusive Growth and Employment Creation Political Entrenchment and Multistakeholder Governance Natural Resource Scarcity and Climate Change The Digital Revolution Source: World Economic Forum (2011): Outlook on the Global Agenda Retrieved from: 3

4 WEF Global Risks Report Risk Categories Economic Environmental 5 Centres of Gravity Chronic fiscal imbalances Greenhouse gas emissions Geo-political Global governance failure Societal Unsustainable pop. growth Technological Critical systems failure Source: World Economic Forum (2012). Global Risks 2012, Seventh Edition. Retrieved from: Global Economic Recovery Affected by some economic challenges: the rise in energy prices (Arab Spring uprisings) Disruptions to global supply chains caused by Japan s earthquake political stalemate over the U.S. debt ceiling Europe s deepening sovereign debt crisis Source: Canadian Chamber of Commerce, Policy Brief (2011). Economic Outlook. Retrieved from: 4

5 Closer to Home Canadian Context 2012 Economic advantages: sound banking system comparatively good fiscal position (Balance 2015) resilient housing market strong corporate balance sheets hardy commodity exports ((e.g. crude oil, minerals, base metals and lumber) Retrieved from: Canada: Economic Challenges External: European debt crisis i could hit Canada Canada s export sector could be held back Domestic: global uncertainty reduces consumer and business confidence Reduced spending Reduced hiring Increased household debt (153% debt: income ratio) Modest growth (real GDP projected at 2%) Retrieved from: 5

6 Canada: Economic Forecast 2012 Canadian consumers are tapped out Housing activity is poised to moderate Government spending restraint will weigh on economic performance Net exports are expected to remain a source of weakness Business investment will remain a strong support to growth (equipment and machinery) Retrieved from: Canada: Fiscal Forecast 2012 Inflation expectations are well-anchored The Bank of Canada is expected to stay on the sidelines until 2013 Canadian dollar is down (expected to trade at 95-cent US level) as negative market sentiment prevails over fundamentals: relatively low level of government indebtedness (target balance 2014) a strong banking system firm commodity prices triple-a credit rating Retrieved from: 6

7 Federal Budget 2012 The 2012 budget will focus on five key areas: expanding trade and opening new markets; investing in research and development; contributing to skills training; eliminating red tape; keeping taxes low; and controlling debt and deficits Source: Canadian Plastics (2012, January 16). Harper looks to manufacturers, small business to help steer economy in Retrieved from: Manitoba at a Glance Strengths Strong labour market including participation rate Manufacturing /sales Housing starts population growth, relatively strong personal income gains, low interest rates Diverse export market Business capital spending up Increased slaughter capacity Challenges Agriculture commodity price volatility, fluctuating currency, trade barriers, weather (wheat and canola down 29.9% and 23.2%). Mining sector Fluctuating commodity pricing (currently up) Foreign exports down (slaughter hogs and beef) Source: Manitoba Finance (2012, January 11 ). Manitoba Economic Highlights.. Retrieved from: 7

8 Cost Pressures on Local Business Taxes and government regulations (#1) Rising wages Shortage of skilled workers Shortage of management skills Time constraints Insufficient domestic demand for products or services. Increased federal and provincial net debt Source: McNeil,M.( 2012, January 2). Manitoba Businesses Losing Confidence. Winnipeg Free Press. Retrieved from: The best argument against democracy is a five-minute conversation with the average voter...it has been said that democracy is the worst form of government except all the others that have been tried. ~Winston Churchill A LITTLE PRIMER ON GOVERNMENT (IF YOU NEED IT) SLIDES

9 Government in Canada Provincial i Sovereign Fd Federal Senate House of Commons Governor General Prime Minister Cabinet Ministries Lieutenant Governor Premier Cabinet Ministries Municipalities Legislative Assembly Reproduced from: Three Branches of Government Executive: Comprised of the Cabinet and the bureaucracy of the government that carry out the government business and laws of Canada. Legislative: The legislative bodies of Canada. They make and debate the laws. Judicial: Comprised of the various courts of Canada. They decide who broke the law and the punishment that corresponds. Source: The Canada Page. Three Branches of Government. Retrieved from: Branches of the Government 9

10 Reproduced from: Federal Government Seated in Ottawa Headed by the Governor General of Canada on the advice of the Prime Minister. Responsible for things that affect all Canadians such as: defence, criminal law, employment insurance, postal service, census, copyrights, trade regulation, external relations, money and banking, transportation, citizenship, and Aboriginal Affairs and Northern Development Every issue not mentioned as belonging to the provincial or territorial governments comes under the power of the Federal Government. Source: Canada Info: Government in Canada Retrieved from: 10

11 The Parliament of Canada The Governor General Position largely ceremonial The House of Commons Members of Parliament sit to debate federal legislation elected in individual ridings based on population to represent and make decisions on behalf of the people of that riding. The party with the most seats forms the Government.The rest form the opposition and the party with the second most seats becomes the Official Opposition There are three main functions: to debate and vote upon legislation to give the chance for the opposition to question what the government is doing with legislation Private member's business : MP s can make a speech about any issue The Senate Federal body that is another House of Parliament ( Upper House ) Designed to give "sober second thought" to legislation (no effective power to quash legislation) Senators are appointed by the Governor General upon recommendation by the Prime Minister (provincially and regionally). Occupations represented include business executives, lawyers, dentists, doctors, farmers, journalists, labour union executives, accountants and academics. 11

12 Provincial Governments 10 Provinces, each with own capital city Province has own Crown represented by a Lieutenant Governor on advice of a Premier Province receives power and authority via Constitution Acts, Province owns provincial lands in the Crown in right of the province Responsible for things that affect a province (e.g. property and civil rights, administration of justice, natural resources and the environment, highways, education, health, and welfare). Territorial Government 3 Territories Headed by or a Commissioner (territories) on the advice of a Government Leader Derive mandates and powers from the Federal Government Crown lands in the territories are retained by the federal government in the Crown in right of Canada Parliament may enter into provincial-type affairs Territorial governments are not included in the Constitutional amending formula 12

13 Provincial Legislatures Set-up similar to federal government except there is no Senate. At different ridings across a province representatives (MPPs, MLA's etc) are elected to represent and make decisions on behalf of the people that live in that riding. Provincial parties act separately from the federal parties although for the most part the policies are along the same line. Municipal (Local) Government Municipal governments in each city or community are responsible for things that are directly related to a city (e.g. policing, fire fighting, snow removal, recycling and garbage collecting) Cities are run by city councils with each "ward" (which is a an area) being represented by a councillor. At the head of the council is the Mayor of the city. Councillors and the Mayor are elected by citizens at least every 5 years. 13

14 The business of government is to keep the government out of business - that is, unless business needs government aid. Will Rogers INTRODUCTION TO BUSINESS GOVERNMENT RELATIONS Comparison Business Market-driven Private gain Create & exploit - compete Accountable to shareholders Purpose - Profit Other characteristics? Government State-driven Public interests (collective agenda) Accountable to citizenry Purpose public good Other characteristics? Corporate Social Responsibility (CSR) Balanced Scorecard (BSC) Source: Roy, J.(2007) p Countervailing pressure Efficiency Effectiveness 14

15 Convergence Business Government CSR Efficiency Countervailing gpressure BSR Effectiveness Demanding Environment Consumers Investors Citizens Interest Groups Accountability Mutual Independence Business needs government Government needs business Depend on business investment for the wellbeing of its citizenry Generation of tax revenues to pay for public services Public satisfaction for re- election gains Stable sets of rules Protection against threats Reducing competition Compensation for negative externalities of economic decision-making Source: Hale, G.(2006).Uneasy Partnership: The Politics of Business and Government in Canada. Broadview Press p.7 15

16 Business Government Relations Three scholarly perspectives in Roy (1997), p. 4-14: Independence d (Jacobs 1992) Seeks to limit corruption and inappropriate hybrids Commercial moral syndrome Guardian moral syndrome Influence (Stanbury 1993) Identifies the gap between the sectors as an area of influence where intermediaries (lobbyists) can further interests and shape decisions on either side Interdependence (Paquet ,1997, 1999) concerned with overall learning and mutual adjustment Private, public and civic spheres act individually and collectively Source: Roy, J.(1997). p.4-14 Boulding Triangle (1970) Economy B Society A C Polity Source: Paquet, G. In Roy, J. (2007). p.11 16

17 What does this mean? Governance for Conformance and Performance What does it look like? Why is it important: To Business? To Government? To Society? Source: Roy, J.(1997). p