By Adam Burroughs
Election years are filled with uncertainty. Each cycle brings campaign promises and conflicting messages about impactful issues such as taxes and healthcare, and markets tend to react. This is especially true in years like 2020 when compounding circumstances like the COVID-19 pandemic may impact not only who citizens vote for, but also how they vote, in person or by mail.
“It can feel like you’re operating in a very volatile environment,” says Barbara Benham, executive vice president and chief public affairs officer at Huntington. “It can be challenging to predict who is going to win and what policies they will actually follow through with, so it's prudent to have a long view and focus on the variables you can control.”
Local Politics Matter
While politics at the federal level get most of the attention, when it comes to laws and regulations that affect business owners, much of that happens at the state and the local level. And that’s where business owners have an even more significant voice. Benham says your mayor—who likely knows your business well—has the potential to become your state representative, then governor, and possibly a member of Congress. Local politics can be critical not only where the company’s headquarters are located but in each state or municipality in which it operates.
“So, it’s a long-view relationship,” Benham says. “It’s building relationships of trust over time and not getting caught up in a single issue, but rather, on balance, working with them to try to create an overall policy environment that is best for your business. That means keeping the communication channels open and being open to, and suggesting, lots of compromises.”
Benham says officials deal with a broad range of topics, so they are dependent on, and appreciative of, business owners who take the time to explain the real-life implications of the decisions they’re making and how it affects their business’s ability to serve their customers and communities. Business owners, then, should feel empowered that they can have a persuasive voice at the local level, where they know their markets and the specific implications of policy issues.
Amplify your voice
Whether incumbents hold their seats or there is new political leadership, election outcomes bring both opportunities and risks for businesses. Whoever ends up controlling the levers of power in government will bring regulatory changes that either affirm or pull back–to varying degrees–the policies that were put in place by the previous administration. It’s important, therefore, for businesses to monitor and be aware of the potential political outcomes in their areas well beyond any single election cycle, plan for those eventualities, and be ready to pivot toward opportunities created by the outcomes of those elections.
“For businesses, it’s important that you are focused through any election cycle on the policies that your business is most sensitive to,” Benham says. “Think through all your external market factor risks, assuming any outcome is possible, and maintain a healthy perspective that political pendulums tend to swing over time.”
She suggests focusing energy on the public policies that matter most to your business, then educating elected officials on how those policies affect your business and your customers.
She also suggests being engaged with your industry trade association or chamber of commerce as ways to effect change in government.
“There’s strength in numbers,” Benham says. “Signing on, advocating for, and shaping the policies of the trade amplifies your voice. So, the elected official that you’re weighing in with is not just hearing from you, but, hearing from many others representing additional employees and customers who share your perspective.”
To be sensitive to the changing political and policy dynamics at all levels, businesses should connect with those who are deeply informed and up to date on all the latest issues related to their business. Where feasible, it’s a good idea to have a person dedicated to monitoring the political and policy context in which you operate.
“It’s dangerous for a business to spend all its time talking to itself and not be aware of all the factors that could both be a benefit or a risk,” Benham says. “Having someone who monitors that and can speak at a senior leadership level where decisions are being made, can protect your business from a reputational and operations standpoint, and make sure the company is not tone deaf to the current conversations happening in the country. That’s important from a governance perspective.”
When it comes to policy and political advising, it’s important to be balanced, always take the long view, and not fall into a trap of believing hyperbole or buying into the fear that often drives campaigns. That’s very different than the longer-term, more thoughtful policy work that affects your business.
“You should never change your business model based on a campaign speech,” she says.
Operating in the gray
The majority of elected officials, Benham says, operate in the world of compromise and collaboration—something that doesn't often get celebrated.
“I’ve yet to find a politician who lives in a world solely of absolutes,” she says. “Most operate with an eye toward the middle, which means there are opportunities for subtleties and dimension. Don’t be discouraged by the outlier voices, which tend to get the megaphone. There are many highly thoughtful individuals who want to create good legislation, and they want to hear from business owners on what the implications are—what a policy will really do. They want you to succeed, but they can’t address the legislative hurdles to help do that if you don’t engage.”
For more information on how to prepare your business for election year uncertainty, reach out to your Relationship Manager.