Unfortunately, whenever lobbying is mentioned, people first think of corruption, or at least of some shady influence on decision-makers, usually on behalf of some corporate interest – not necessarily in line with the public interest.
The truth of the matter is actually quite different. Namely, the moment we are facing corrupt lobbying practice in any shape or form, we are not dealing with lobbying anymore, but clearly and undoubtedly with criminal activity.
Putting the two into the same basket is actually the same as when we refer to “business” assuming that it always implies some illegal activities. The fact is that most business is not only legal and legitimate but even ethical – serving the public fairly and correctly, while only some of it tends to be illegal and therefore harmful to society and its members. Again, that is not normal business anymore, but becomes a crime, and should be treated as such.
Lobbying - defined shortly as influencing decision-makers - is a constituent part of any successful democracy, giving anyone the opportunity to represent their interests. But, it should be done legally, legitimately, and possibly ethically. While the first criterium implies no law is broken, the second means all provisions of lobbyists’ codes of conduct are being fully respected, and ethical meaning societal interests are not being hurt.
Though this is pretty straight and clear enough, it is a challenge for democratic societies to make sure that lobbying is performed in a strictly positive fashion, not only legally, but also legitimately and ethically. Nobody is perfect, but only a few countries have achieved a satisfactory pattern of lobbying.
Experience around the world demonstrates that successful regulation of lobbying is more easily declared than being effectively implemented. The USA, for example, has the oldest and most elaborate lobbying legislation, and yet they experience a lot of abuse of lobbying. On the other hand, Switzerland and the Nordic countries have no specific lobbying laws, but experience rather limited abuse of lobbying. Obviously, it takes more than the law to keep lobbying from being abused. It takes the power of a civilized, positive civic culture, to protect lobbying from being abused against the public interest. This to be achieved is by no means simple & easy, and – as experience shows – it also takes quite a lot of time! It is part of the democratic maturing of a society.
The roots of terminology
The origin of the term lobbying comes from various sources, but they are all related to the physical space where lobbying was actually taking place: in ancient Rome “lobia” was the lobby in the Senate building, in the English House of Lords the “lobby” was where the noblemen were presenting the King with their petitions. And the lobby of the Williard hotel in Washington was where president Grant was known to relax with a cigar and whiskey and was often lobbied by members of Congress.
Nowadays, as lobbying has become much more widespread and popular, it is recognised that there are many definitions being used – generally identified as influencing decision-makers, but also referring to communication with influential social actors, or public advocacy. Lobbying actually takes place at all levels: from putting pressure upon governments and parliaments, in business, and in NGOs, as well as within families and informally among friends. But, it still is always about influencing a decision-making process.
The negative public perception
As rather few cases of abuse of lobbying actually finish at court, while the media love to report on suspicious cases, it is not surprising that public opinion is mostly negative, believing that abuse of interest representation is more common than it actually is the case.
Contrary to dominant public opinion, the research has proven that not so many lobbying campaigns are fully successful. Partly because rather often various lobbying efforts effectively neutralise each other, while still offering to the decision-makers different perspectives and approaches to the problem. This is still useful, as it contributes to critical observation of all aspects of the problem and possible solutions, and could improve the quality of final decisions by governments and parliaments – which is most important as this affects the broadest public, and usually for a longer time.
One of the reasons why negative public perception still dominates is also lack of empirical studies of specific lobbying campaigns. The reasons behind this are that none of the parties involved are really interested in the publicity of their lobbying campaigns: decision-makers prefer that it is not generally known who has been lobbying them, lobbyists (particularly when they were successful) are reserved against publicity, and the least interested in publicity are the clients, who have hired lobbyists to protect their interests – especially those unfriendly to the public.
Additionally, though interested to do research on lobbying campaigns, the researchers are facing a problem of access to information – which is a serious impediment for professional researchers interested in this phenomenon.
This is, however, not a problem for the media, since for them it is allowed to report and comment on partial information – particularly as access to information is a problem for them as well. Undoubtedly, the media contribute a lot to the negative perception of lobbying.
How do the lobbyists react to this negative public opinion? In Brussels, there are four associations of lobbyists, and none of them has the word “lobby” in their official name – which is – to say the least – rather opportunistic!
The potential of lobbying regulation
Basically, there are three types of regulation addressing lobbying:
- lobbying law;
- public register of lobbyists;
- self-regulation is adopted by lobbying associations who adopt their own codes of conduct.
So far less than 25 countries around the globe have decided to adopt a special law on lobbying, while a few more have introduced an official lobbying register. All other countries obviously believe that their existing legislation – including laws on crime – are sufficient to address the potential abuse of lobbying.
Experience shows that the law and the register do contribute to a higher level of transparency, but do not prevent some abuse to happen.
The codes of conduct adopted by all lobbying associations certainly play a role, depending on how strictly they are being respected and applied. Unfortunately, there are cases when some members even left their association in protest of excessive tolerance of non-compliance.
Also, OECD is paying adequate interest to lobbying, which is confirmed by the Council having adopted on 18 February 2010 the Recommendation of the Council on Principles for Transparency and Integrity in Lobbying. Four years later these principles have been highlighted again in the Strategy on Trust – adopted by the OECD Ministerial Council in May 2014. Also, the member states have been invited to create conditions to allow free interest representation, as an important component of democracy.
After evaluating national regulation on lobbying, the influential global NGO Transparency International - working relentlessly on issues of corruption - has published in December 2015 the first “International Standards for Lobbying Regulation - Towards greater transparency, integrity and participation.”
The guiding principles of lobbying standards contain the following very clear statements:
- lobbying is a legitimate activity and an important part of the democratic process;
- there is a significant public interest in ensuring the transparency and integrity of lobbying, as well as a diversity of participation and contribution to public decision-making;
- any regulatory measures to secure these ends shall be proportionate, fit for purpose and not impede on the individual rights of assembly, free speech and petition of government.
According to H. Chari, countries could be grouped according to their regulatory regimes into three categories: low, medium, and high, while the classification of country legislation is based on the following six major features:
- registration regulations;
- spending disclosure;
- electronic filing;
- public access;
- revolving door provision.
How does it work in the US and in EU
In the US the first attempt at lobbying regulation was “The Federal Regulation of Lobbying Act” of 1946, followed by “Lobbying Disclosure Act” of 1995, and more recently amended by President Obama’s Executive Order on “Honest Leadership and Open Government Act” in 2007.
There are some 11,000 lobbyists operating in Washington, and some 3.5 billion $ being spent on them, but after the Executive order came into power, the mandatory reporting became tougher, and as a consequence about a third of lobbyists left the official Register. However, since the amounts being spent on lobbying remained the same, obviously some lobbyists are operating as consultants, legal representatives, etc. – bypassing the good intentions of the Executive Order.
The conceptual background of lobbying is the First Amendment to the US Constitution, which guarantees the citizens “the right to “petition” – being the basis of American democracy. Therefore, American companies and other organisations are much more open to lobbying, and any kind of interest representation is more accepted and thus more legitimate than in European political culture.
The USA is a very important global factor, whose support is valuable to everyone, especially to smaller and emerging countries. It is therefore not surprising that these states invest money and engage professional lobbyists in carrying out their efforts to obtain US support. Sometimes they are just groups of intellectuals trying to get in a position to advise, to hear "their side of the story". The three biggest foreign lobbying in US has been recently from Japan, China and South Korea.
Lobbyists in the US must be well-educated, highly skilled in communication, and socially well-connected experts – usually specialised in some domains of public life. Government officials and congressmen/women, as well as business leaders, are interested in obtaining their expert opinion, as well as their influential connections.
There are great differences among corporate and lobbyists representing various NGOs. While the first is pushing for solutions (legislative and others) favouring their clients’ interests, the second is mostly defending issues of broader public interest – be it in the environment, consumer protection, health and social protection. As we can see, there are big differences between lobbyists, both in motivation and expertise, but also in earnings.
If we look at the register of transparency when it comes to corporations lobbying in the EU, we see that Microsoft, Google, and Facebook are dominant in terms of spending on lobbying. Those companies want to influence the reduction of restrictions through regulations aimed at limiting their power in the market. Once the leading investment sector was the pharmaceutical sector, today it is IT and other technology companies. Both leading companies and the EU institutions are aware of this once unwanted "partnership".
The EU has always been a domain of lobbying, but it became much more intensive since the process of integration has reached the common market stage, as most of the economic regulations affecting 500 million Europeans are being decided in Brussels. It is estimated that now about 25-30,000 lobbyists are acting versus EU institutions.
Introduced back in 2010 by the European Commission under the Transparency Initiative, the European Lobbying Register now also contains over 12,000 lobbying organisations, among whom many are there only or primarily for gaining prestige in their local environment.
The regulation of lobbying in the EU is different, but not only in comparison with the USA. We can also see differences between the regulation of lobbying in the European Parliament and the European Commission, which is the primary target for Brussels-based lobbyists.
EU member states regulate lobbying in various ways. Austria, France, Germany, Ireland, Lithuania, Poland, and Slovenia, as well as the Spanish Region of Catalonia, require mandatory registration. On the other hand, Belgium, Italy, and the Netherlands do not have such requirements but offer certain incentives for lobbyists to register on a voluntary basis. Other EU countries are subject to self-regulation.
European Parliament in 1996 passed the first lobbying rules, named Rules of Procedure, and a lobbying registry was introduced. Every person who wishes to enter Parliament as a lobbyist had to do so transparently.
Lobbying in the EU and the USA also differs in style. In the US, the approach is often more aggressive, more "personal", while in the EU it is more about the briefing, consulting and building consensus. In essence, the difference between political cultures and systems is reflected also in the diversity of styles in lobbying.
What is necessary to create the needed conditions making lobbying a normal, vital component of a vibrant democracy? Answering this question is rather demanding and complex, and the more we go into details, the stronger is the impact of a respective cultural context.
Undoubtedly, lobbying can and should be an important instrument of democracy – but the extent to which this is the case, depends on the pattern it is actually performed: is it done legally, legitimately, and possibly even ethically. If so, nobody can deny that lobbying has the potential to contribute to effective democracy.
However, this must be respected consistently both by the lobbyists, as well as by the lobbied. The effective condition for such circumstances is not just a specific lobbying law, because – as experience demonstrates – the law itself plays a rather limited role, particularly if it is being largely ignored, and the consequences are being tolerated by the authorities.
This conclusion should not be misunderstood as underestimating the contribution the regulations can potentially provide. What matters is the actual impact, and it is impossible to confirm that there is a clear positive correlation between state regulation and the quality of lobbying activity in a country. In other words, unless other conditions are also being met, the law itself tends to have a very limited impact on the quality of lobbying activities. Probably the US and EU experiences offer sufficient evidence for this conclusion.
In a basically naïve fashion, several young democracies have adopted special lobbying laws, and most of them committed an important conceptual mistake by placing the reporting obligation too close to the government bodies responsible for fighting corruption. That unfortunately contributed to the public misunderstanding of lobbying being by definition close to corruption. Though with limited research to reliably substantiate this conclusion, the expected impact of the lobbying laws has not fully materialised. At any rate, lobbying suffers the same poor public rating, as it does in other countries without specific lobbying regulation.
Let us conclude by claiming that it is primarily necessary that people perceive lobbying in its authentic nature and societal function: being interest representation and communication with decision-makers and influential stakeholders in society. In a democratic setting, it is unimaginable to have interest representation prevented or even prohibited by law. Actually, there are only some countries where this is the case, and one could easily conclude that they are in the early stages of democracy. Ironically, in such conditions lobbying actually still does take place, but it is performed only by some people, who have privileged access to power holders – excluding other people. No need to emphasize that in this case lobbying is not an instrument of democracy, but rather an instrument of manipulation in an autocratic environment.
Generally, lobbying can contribute to efficient democracy and a productive business environment when the following conditions are fulfilled:
- lobbyists do respect the law, the Codes of Conduct, and public interest;
- decision-makers communicate with lobbyists transparently and reject any attempt of corruption;
- members of a society accept the positive nature of lobbying as transparent and legitimate interest representation;
- politicians treat lobbying and lobbyists correctly and without prejudice.
What could contribute to a better appreciation of lobbying is – inter alia – also the introduction of the subject into the high school and university curricula. This should be part of the 21st-century competencies and skills, in the context of communication, negotiations, interest representation, and active citizenship. Unfortunately, this is still more an exception than the rule.
(Article prepared by prof. Boris Cizelj and Mirko Plavšić)