Businesses: Be Aware!

No Karnas in Navabharat

“If you cross over, you will be the King; Yudhishthira, the crown prince of Pandavas will stand behind you holding the royal fan; Bhima will hold his great white umbrella; all the Pandava allies will pay tribute and touch your feet,” Krishna thus urges Karna while lobbying for the success of the Pandavas in the forthcoming war. Indeed, Krishna begins his lobbying by revealing the secret of Karna’s royal birth—of his being the eldest son of Kunti. Of course, it is the nobility of his character that Karna does not fall for it; nor does he ever reveal this conversation to anyone as, of course, sought by the parting Krishna.

Any wonder, if modern-day lobbying fades before Krishna’s? Of course, that is not what matters most now. What really matters is: What is this ‘lobbying’ that is today rocking India and Indian businesses wildly? And, how has it become so deep-rooted in managing human/business/political affairs for ages? Dictionary defines lobbying as “a form of advocacy with the intention of influencing decisions made by the government by individuals or more usually by lobby groups”, which includes all attempts to influence legislators and officials whether by other legislators, constituents, or organized groups. And a ‘lobbyist’ is a person who tries to influence legislation on behalf of a special interest or a member of a lobby.

Pieter Bouwen, author of the paper, “A Comparative Study of Business Lobbying in the European Parliament, the European Commission and the Council of Ministers,” argues that lobbying activities of business interests need to be conceived as an exchange relation between two groups—private and public actors—of interdependent organizations. He also avers, “It is a mistake to regard business lobbying as a unidirectional activity of private actors vis-à-vis the public institutions, for the public institutions too need to interact because they need close contacts with the private sector in order to fulfill their institutional role.”

The interaction between private and public organizations is conceived by sociologists as a series of inter-organizational exchanges, mostly driven by the ‘resource dependence perspective’ proposed by Pfeffer and Salancik (1978). According to this model, public institutions are not internally self-sufficient and hence need resources from the environment, and therefore have to interact with those organizations or groups in the environment who control the resources they need. It is in the context of decision-making process that the private and public actors become interdependent, for they need resources from each other. Here the exchange is mostly in terms of ‘access’ to the public institutions that are known as agenda-setting and decision-making bodies for private organizations, and in return for this access, public institutions demand certain goods that are crucial for their own functioning. These goods are called ‘access goods’, which are mostly concerned about three kinds of information: one, expert knowledge—information needed to understand the market; two, information about the encompassing interest—information on the aggregated needs and interests of a sector in the whole market; and three, information about the domestic encompassing interest—information about the aggregated needs and interests of a sector in the domestic market.

This being the apparent logic behind the lobbying behavior of business groups, it is needless to say here that the large players who have enough resources to undertake individual lobbying gain greater access to public institutions, while the smaller actors have to often rely on collective action to gain any political advantage. Interestingly, economist Thomas Sowell, defending corporate lobbying as simply an example of a group having better knowledge of its interests than the people at large do of theirs, gives an altogether new connotation to the art of lobbying. Back home, we have Abhijit Sen, member, Planning Commission, who is reported to have said: “To some extent, it will reduce corruption.” In a way, Sen echoes the logic behind lobbying traced above, when he says, “In a country that lacks world-class research centers, officials have little choice but to rely on the fact-filled presentations that the lobbyists provide,” if the press reports are to be believed.

Now, thanks to the continued bedlam in the Parliament for the last 15 days which has brought to the national scene the whole glamour (or, is it the murkiness?) of Washington-type of lobbying that recently made deep inroads into India—the business of persuasion to garner influence through various games: planted stories and PowerPoint presentations—that too, in a big way, its positive fallout being: with the kind of liberalization of economy that we have set in motion, we cannot but learn to live with lobbying.

Some critics, albeit rightly, argue that some of the practices of lobbyists are within the law, while others comment that it can be harder to counter these tactics. So, what the current turmoil generated over lobbying now calls for is: more scrutiny. But before that takes a formal shape, what the leaders, be they from the business or political field, need to realize is that there is no other known way of protecting one’s privacy than being always clean. For, being clean and ethical minimizes the need for the verb ‘hide’.

 

But how difficult it is to be always clean!

GRK Murty