Kartikeya Jaiswal

WEEK 5 REVISION: BUSINESS GOVERNMENT RELATIONSHIPS

Context Meaning Parties Involved Nature of Policy Factor in Influence
Clientelism Where the business is Business, Mutualy Relationships.
a client of a Government. Beneficial.
government. Public Interests.
Businesses receive Society plays a complementary.
benefits from the role in providing
Govt. Support the labour. But can
business with also oppose
projects, subsidies projects.
etc.
Businesses invest in Eg: Power Plant,
the economy in Sumitomo.
return

Tender A auction, or licence Eg: Temple case, Special form of

to a project or power Eternal Pure Land. clientelism.
plant etc.

Corporation When business come Relevant interest Cooperative Have a seat in the
together as a group groups. Relationship. committee.
and work together for
corporate interests. Business reps. Compromise Various Chambers.
Worker reps. between all (SICC, AmCham).
Collectively try to Govt Reps. relevant groups to
influence the strike an optimal
government. Not very common point.
in Singapore. Not
very effective in
SG context.

Pluralism Various interest Interest Groups, Controversial in

groups compete to NGOS , Nature.
influence the Businesses,
government. Government. EG: Singapore
Casinos.
WHY INFLUENCE THE GOERNMENT?

Office Desired Outcome

President Influence

Parliament Legislative favours.

Influence the Executive
Lobby in favour of

Executive/ Cabinet/ Minister Favourable Policies and Laws.

Statutory Board Government Resources
Subsidies
Infrastructure
Information (Statistics, Market Data)

All of the above, if provided at a good

level from the government is very
beneficial to business that can use such
provisions to further their operations
and increase their profits.

Court Rule in Favour,

Protection,
Judicial Review (Challenge the Govt)
Intellectual Property
Mergers and Acquisitions
BGS LECTURE WEEK 6 (FOCUS: SOCIETY)
Society, Interest Groups, PETA, NGO, Activism, Greepneace, Etc.

GOLDEN-AGRI:
They lied about their activities about deforestation and damaging rain forests.
Greenpeace intervened to stop Golden Agri.

KFC PROTEST:
A USA animal rights activist protested in Malaysia against animal cruelty, against Goreng
(fried chicken).

ACRES CAMPAIGN AGAINST RESORT WORLD SENTOSA:

Please let the dolphins go!
Resort World actually is a tourist attraction and gets a lots of profits so it is hard to
convince the government to let them go.
However, they face criticism for holding dolphins captive and causing psychological damage
to the animals.

UNDERWATER WORLD SINGAPORE:

Dolphin contracted a rare form of non contagious skin cancer.

ANTI- SHARK FIN CONSUMPTION CAMPAIGN:

Unethical poaching of sharks etc.

RUSSIA-OIL-ARCTIC ENVIRONMENT VIOLATION

ACTIVISM AGAINST SINGTEL IN AUSTRALIA FOR 700MN TAX EVASION

WHAT ARE ACTIVISTS TRYING TO ACHIEVE?

Animal rights
Human rights
Environment rights
Economic rights
Welfare
Equality
CASE STUDY

RAIN FOREST ACTION NETWORK

ISSUE: Rain Forest Deforestation (causing global warming).

Location: Tropical Regions and Equator.

Problem: Deforestation

How do we Solve Deforestation?

Campaign for Forest Awareness.
Approach Ministry of Forest/Environment/Nature.
Lobby with more action groups to talk to MPs.
Approach Companies.
Lead Protest.

Target Desired Outcome

Parliament Legislations against Deforestation.
Criminalise Deforestation.
Lobby to pass bills discussing
regulations for companies to protect
the environment.

Ministries and Statutory Boards Policies.

Regulations.
Support for the cause and monitor
relevant companies violating the
laws preventing deforestation.

Judiciary Injunction Order of the court to

stop doing something.

Corporation and Companies Approach the companies and sign a

memorandum of understanding or
get them to sign a mission statement,
code of conduct etc, to stop their
practices of deforestation.
Or approach the shareholders and
convince them to pressure the
director and CEO, and include
prevention of deforestation in their
shareholders resolution.
How to stop a Company when your NGO is based in another country?
Partner with Local NGOs.
Set up a Franchise in that particular foreign country.
Try to approach the foreign government through your own government.
Use social media to create awareness in the foreign country.
Approach the companies themselves.

What did RAN do?

Encountered difficulty while lobbying with governments.
Went after companies directly.
RAN went after Citi-Group.

RAN v/s Citi-Group:

1. Citi group was advertising a Live Richly campaign at the time.

2. And also a Protect your purchase campaign.
3. Using Citigroups credit card provides opportunities for refunds, product exchange,
extended warranties, etc.
4. Portrayed itself as if it cares about the lifestyle and standard of living of consumers.
5. But it was actually funding deforestation activities.
6. Fighting a big bank has its pros and cons:

Pros- Gather media attention, good for spreading awareness of the cause,
Cons- Banks have a lot of money, lots of resources, access to governments, top
lawyers, proximity to policy makers, and can fight back really hard and
suppress such activist attacks.

7. However, Citigroup depends on lots of consumers to use their credit cards, depends
on retailers for using their credit services, exchange portals, etc. Thus such activist
attacks make Citigroup vulnerable to losing customers, clients, partnerships, etc.

SHOULD CITI-GROUP WORRY ABOUT RAN?

1. Look at the Track Record of RAN - 25 years of successful causes. RAN succeeded
against Home Depot (1999), Burger King(1987), Stop Timber Import(1994),
Boycott Mitsubishi(1994).
2. Size Number of members, employees, Amount of Funding.
3. Influence Government recognition, International Recognition, Research
Expertise, Media Campaign Management.

WHAT CAN RAN DO AGAINST A BIG BANK LIKE CITI?

1. Media Approach traditional media, use social media to create awareness.
2. Traditional newspapers, magazines, etc.
3. International Partnerships Use NGO affiliations and interest groups to spread
the cause.
4. Protest On ground agitations. (Boston, DC, ETC), Banners, Publicity Stunts
5. Documentaries - Short movies issued in public interest to spread awareness.
6. Festivals Get support from musicians and celebrities at events, festivals, etc.
 ISSUE LIFE CYCLE:

Refer to Simon Zadeks work (elearn).

1. In the beginning of an issue, the tory is not credible or believable to most people.
2. Then, if evidence is found, the story gains credibility.
3. Once it gains credibility, it begins to be aired on National TV and gets public attention.
4. Activists now can push their causes further on multiple platforms and mobilise public
opinion.
5. Gain Involvement- Activists seek active involvement and not really passive involvement.
6. Effect Activists first try to reason with companies, then if companies dont agree, they try
to hurt companies to give in and agree.
7. Impacting Profits Either increase their costs, or reduce their revenues. Eventually, hurt
their profits.
Reducing Revenues Disrupt their operations, get consumers to boycott the
product, harm the image of the company and thus discourage potential investors
from investing the bank.
Increasing Costs Since not many investors would be willing to invest, the few that
are ready to invest can charge a much higher interest rate on the debt they issue.
Also, activists can convince employee unions to protest for pay hikes etc.

VERDICT:
Citigroup reached an agreement with RAN, to stop funding and lending to non
environmentally friendly companies.
Citigroup decided to stop funding companies in mining, blasting, coal, logging, and refrains
from companies selling oldgrowth wood products.
They included environmental standards as a part of their lending criteria.
Stages What will Citigroup do?
Defensive Deny their involvement in funding coal,
timber, deforestation activities, hold press
conferences.

Send spokespersons to News Debates to

deny their involvement and intentions.

Can say that they only lent the money, but

did not destroy forests themselves and that
they are not the right people to be blamed,
but activists should go and catch the
company actually damaging trees.

Compliance More of PR management stunt, only at a

superficial level to show they are doing
something about the situation.

Say that they are in talks with the company,

restructuring the financing, investigating the
situation etc, just to please the crowd and
control activist enthusiasm.

Managerial From now on, they may change their criteria

for lending out loans.

They may check the background of the

client, if they are environmentally friendly, if
they have decent conditions in their
factories for workers, dont violate human
rights, dont fund terrorism, dont evade
laws etc. Citigroup from now on will look out
for more such things to avoid possibilities of
widespread public criticism.

Strategic First mover advantage.

Incorporate environment friendly clauses
into their mission statements.
Accept their responsibility, divest, set an
example, and not only save their reputation,
but actually gain respect. This way they can
gain investor, government and consumer
confidence, set themselves apart from other
banks and gain ethical credibility, and thus
increase their chances of getting more
business and trust in the future and thus
higher profits

Civil First mover disadvantage

CASE STUDY:
SILENT SPRING BAN USE OF DDT IN AMERICA (RACHEL CARSON)

Rachel Carson successfully managed to get DDT ( pesticide/ insecticide) banned in USA.

She spent 5 years working on her book Silent Spring.

President JFK, was very impressed by her work and ordered scientific investigation into the
harm and effect of DDT.

After Carsons death in 1964, USA government filed an injunction to ban DDT usage.

Example of Environmentalists convincing the Government.

 Public Politics and Public Regulation:

Public Politics and Public Regulation: