Themes for Corporate Affairs leaders to consider in 2019
After a dynamic and seismic past 12 months, and as we move closer to the end of the first quarter of the new year, the following four themes will become increasingly more important for corporate affairs leaders in 2019 and beyond.
We are living in a world where the rules of engagement, that we have relied on for decades, are no longer as effective as they used to be or have become borderline irrelevant; where the institutions we once relied on and trusted implicitly are under scrutiny – and pressure – like never before.
This world is moving so fast that business leaders are struggling to predict what kind of disruption is coming next – let alone comprehending and controlling it.
Consequently, in our discipline of corporate affairs we will need to be increasingly aware of this changing landscape. It is clear we need to be adaptable, versatile and have the capacity to move quickly to face down these myriad (and often unforeseen) issues.
As we head into 2019, I have no doubt these themes will continue to grow in significance, as will their influence and impact on our roles as ‘reputation’ leaders.
Transparency and trust
The concept of ‘fake news’ has taken hold under Donald Trump’s presidency – Trump himself railing against the mainstream media for its supposedly biased coverage of news; while the President’s critics point to his own tenuous relationship with the truth, especially with regards to his Twitter posts.
Yet there has been fake news of sorts forever; every country disseminates propaganda of some kind.
However in 2019, thanks to digital networking and the way in which we communicate with each other via social media, fake news has become increasingly pervasive and as such we are affected more by it. In this social media-driven world, emotional reaction can easily overpower intellectual reason.
This is where transparency and trust come in.
Access to trustworthy information sources is crucial to good corporate decision-making. Again, this is an area where our discipline can help promote transparency and build trust.
My observations confirm that consumers feel companies rely too much on lobbying and spin doctor PR that is not supported by action. Stakeholders are a lot more aware then they once were and can see through this activity so it’s unlikely to work in 2019 and beyond.
Good corporate affairs strategies rely on truth and transparency. They must be based on real data, real stories and authentic points of view.
That being the case, I think data storytelling will be more important than ever. Marketing surveys that can be skewed or compromised in some way will undergo more scrutiny as customers and business media favour the certainty of real data about real customers.
Building trust will be paramount for our discipline, which means it will have an impact on every strategy devised for the coming year.
As we know, the world's geopolitical situation is the least stable it has been since the end of World War II.
We have witnessed the ongoing problems in Britain with the Brexit vote, the continued turmoil in the US with some of Donald Trump’s decision-making, deteriorating relations between members of the Gulf States, and the rise of Russian hackers having a malign influence on Western institutions.
Closer to home, China’s claim to disputed territories in the South China Sea has caused problems with its neighbours and may yet have repercussions beyond that. And President Xi Jinping’s ambitious One Belt One Road Initiative that spans 78 countries in Asia, Africa and Europe has also got many nations shifting uneasily in their seats.
There is uncertainty and apprehension everywhere.
In a corporate sense, an understanding of the geopolitical situation is vital. The impact of geopolitics on corporate success or failure will, I think, become a key area of debate in 2019.
There is evidence that boards are not doing enough in this respect. A recent survey by global management consultancy McKinsey showed that although 84% of executives believe geopolitical instability will have an important or very important impact on their global business, only 13% have taken any steps to address this in their corporate strategy.
In a sense, this is understandable. It is difficult for companies to plan on the unthinkable – some kind of international conflict - when "business as usual" is the safest professional bet they can make. But in today's ever-changing world, it's time for senior management to break the habit and get a better understanding of the geopolitical environment they operate in.
Our discipline can, and must, contribute more meaningfully to a greater understanding of these issues, and the possible impact they have on the clients we serve.
As the population and workforce – especially in countries such as Australia and the US – continues to grow more diverse, companies will need greater focus on creating company cultures, experiences and products that are inclusive and speak to a wide range of identities and perspectives.
While the diversity conversation often tends to be focussed on women, and their participation in the workforce, the issue is obviously much broader than that. It takes in age, language, culture, gender, disability and, increasingly, sexual orientation.
So, diversity initiatives within corporations need to address all of these groups and interests.
The concept of ‘Inclusion’ means valuing these differences and creating an environment where everyone feels respected and valued for their ‘uniqueness’.
Given its impact on employee brand and reputation, I think our discipline can contribute more meaningfully to address these issues and (where they exist) imbalances.
Corporate and Social Purpose
It seems everywhere we turn, we are being bombarded with talk about the importance of ‘corporate purpose’ in today’s economic world.
In business speeches, marketing campaigns and financial articles, we hear so much about ‘purpose’ that the phrase runs the risk of becoming a trite buzzword.
But that would be a shame. In our current environment, I believe having a clear “corporate purpose” is a non-negotiable. It is not just about being the good “corporate citizen” or being “nice”.
When it comes to weighing purpose, research indicates that consumers think most highly of companies that are responsible, caring, advocate for issues and protect the environment. And the more purpose a company has, the more consumers are likely to support them.
But instilling purpose in every decision an organization makes is not easy. It requires a deep commitment – the kind that lasts far beyond a weekend retreat or strategic offsite meeting.
It’s a non-negotiable, though, because the consequences of ignoring purpose altogether can be dire – as we have seen in recent times through, for example, emissions cheating scandals and, closer to home, the loss of faith in the banking sector.
Corporate affairs leaders play a lead role in aligning reputational based strategies to the delivery of ‘Purpose’ as part of company strategy.
Consumers want companies to act, care and advocate. Purpose is a powerful tool in enabling brands to connect with their customers and employees whilst enabling sustainability by giving something back to the world.
Companies like Unilever, Patagonia and Coca-Cola Amatil are investing in ‘purpose’ because their leaders have a vision for their businesses and a strategy for their brands. Purpose is part of their DNA, and built into their business models.