Ch 8 MGMT 3880

Limited organizational involvement (indirect and impersonal)

- managers are not ready or willing to become politically involved by giving their own time or getting their stakeholders involved, but they want to do something to influence the political environment

Political action committees (PACS)

- oldest political action tools used by business -independently incorporated organizations that can solicit contributions and then channel those funds to candidates seeking public office

Why business should be involved in politics

1. A pluralistic system invites many participants 2. The economic stakes are high for business and industry 3. Business counterbalances other social interests 4. Business is a vital stakeholder of government

Political Action Tactics

1. Information Tactics 2. Financial- Incentive tactics 3. Constituency- building tactics

Business strategies for influencing government

1. Information strategy 2. Financial- incentives strategy 3. Constituency- building strategy

Why business should not be involved in politics

1. Managers are not qualified to engage in political debate 2. Business is too big, too powerful 3. Business is too selfish to care about the common good 4. Business risks its credibility by engaging in partisan politics

Information tactics include

1. lobbying 2. direct communication with policymakers 3. expert witness testimony- takes place after a crisis. Call in people with knowledge of issue

Corporate-building tactics

1. stakeholder coalition 2. advocacy advertising 3. trade assoication 4. legal challenges - businesses try to gain support from other companies that share similar with them

Tax exempt organizations

527, 501(c)4, 501(c)6 organizations -soft and dark money

Lobbyists

Many companies hire full-time representatives in Washington D.C, state capitals, or local cities to keep abreast of development that may affect the company and, when necessary, to communicate with government officials

Financial-incentive tactics includes

Political contributions to political action committees (PACS)

Super PACS

The court ruled that as long as PACs did not contribute directly to candidates, parties, or other PACs, they could accept unlimited contributions from individuals, unions, or corporations - Also known as independent expenditures-only committees -anyone can make a super PAC

Information Strategy

Where businesses seek to provide government policymakers with information to influence their actions, such as lobbying

McCutcheon VS. Federal Election Commission

abolished all limits on election spending by corporations, as well as other organizations such as unions

Legal challenges

business seeks to overturn a law or portions of a law after it has been passed or threatens to challenge the legal legitimacy of the new regulation in the courts

Trade association

coalitions of companies in the same or related industries- to coordinate their grassroots mobilization campaigns. - support from trade association promotes point of view to that industry to government

Advocacy advertising

focus not on a particular product or service, like most ads, but rather on an organization or a company's view on a controversial political issues - also called issues advertisements can appear in newspapers, on TV, or other media

Lobbying

involves direct contact with a government official to influence the thinking or actions of that person on an issue or a public policy.

Corporate Political strategy

involves the "activities taken by organizations to acquire, develop, and use power to obtain an advantage"

Public Affairs department

is to manage the firm's interactions with governments at all levels and to promote the firm's interests in the political process

Grassroots strategy

its objective is to shape policy by mobilizing the broad public in support of a business organization's position - its objective is to influence local opinion leaders

Levels of business political involvement

level 1- limited organization involvement level 2- moderate organizational involvement level 3- aggressive organizational involvement

Moderate organizational involvement(indirect yet personal)

managers might directly employ a lobbyist to represent the company's political strategy in Washington or the state capital to push the firm's political agenda

Economic leverage

occurs when a business uses its economic power to threaten to leave a city, state, or country unless a desired political action is taken

Revolving door

the circulation of individuals between business and government is often referred to

Bundling

the company takes all of the contributions to the candidate, clearly indicating that the contributions are from the firm's stockholders

Dark money

to describe contributions made to these tax-exempt organizations since the donors names and amount of their contributions were not reported to the federal election commission - used for things like telephone calls, TV or radio announcements and social media messages

Soft money

unlimited contributions to the national political parties by individuals or organizations for party-building activities but not to a specific candidate

Financial- incentives strategy

where businesses provide incentives to influence government policymakers to act in a certain way, such as making a contribution to a political action committee that supports the policymaker

Constituency-building strategy

where businesses seek to gain support from other affected organizations to better influence government policymakers to act in a way that helps them

Aggressive organizational involvement( direct and personal)

where managers become personally involved in developing public policy