With the Treaty of Lisbon, which entered into force on 1 December 2009, the EU de facto became a state territory stretching from Portugal to Finland and from Ireland to Cyprus. The European Parliament became an equal-status decision-maker alongside the Council of the European Union (Council). The previous co-decision procedure was elevated to become the standard procedure ("ordinary legislative procedure"). The so-called qualified majority (55 percent of the EU member states which simultaneously represent at least 65 percent of the EU population) was introduced for all important areas in the Council. As a result, the outcome of decision-making processes has become largely incalculable for the actors on the "European Union stage" - the EU member states, EU regions, companies, associations and organisations.
The second edition includes a new chapter, in which Prof. Klemens Joos makes the variables of successful interest representation even more tangible on the basis of his scientific formula: at the latest since the Treaty of Lisbon, the basic prerequisite for successful interest representation in the EU involves the continuous and close intermeshing of the affected party's content competence (of the four "classic instruments" of interest representation: corporate representative offices, associations, public affairs agencies, law firms) with process structure competence (i.e. the EU-wide maintenance of the required spatial, personnel and organisational capacities as well as strong networks across institutions, political groups and member states) on the part of an independent intermediary. The likelihood of success can be increased exponentially if success is achieved, firstly, in committing to the concern of an affected party through a change of perspective such that the positive effects on the common good are shifted into the foreground for the decision-makers in the EU (perspective change competence) and, secondly, in successfully integrating the concern into the crucial decision-making processes at the political level and continuously supporting it (process support competence).
Guest authors:
This work includes guest contributions from Prof. Christian Blümelhuber (Berlin University of the Arts), Prof. Anton Meyer (formerly LMU Munich), Prof. Armin Nassehi (LMU Munich) and Prof. Franz Waldenberger (Director of the German Institute of Japanese Studies, Tokyo) as well as a foreword by Prof. Gunther Friedl (Dean of the TUM School of Management) and a preface by Prof. Thomas F. Hofmann (President of TU Munich).
Table of Contents
Preface 17
Welcome to the second edition 19
Foreword to the second edition 21
Introduction 23
1 Set down in a formula: successful representation of interests in complex decision-making processes 31
1.1 Ways out of the complexity trap of political decision-making structures 31
1.1.1 Problem-solving in complex situations: process trumps content 31
1.1.2 Stakeholder versus shareholder approach 32
1.1.3 Decisions without decision-makers: complex multi-level system of the European Union (EU) 33
1.2 Political rebirth of the EU 33
1.2.1 Treaty of Lisbon as the background to a paradigm shift 33
1.2.2 Reorganisation of decision-making processes due to the Treaty of Lisbon 34
1.2.3 Effects on interest representation from the changed framework conditions of the Treaty of Lisbon 35
1.3 Successful representation of interests in the complex EU decision-making system 36
1.3.1 Formula for success 36
1.3.2 Example of applying the formula for success - the “mountain example” 37
1.3.2.1 Pre-Lisbon: successes for content-oriented interest representation 40
1.3.2.2 Post-Lisbon: process barriers to content-oriented interest representation 40
1.3.2.3 Overcoming the process barrier through process-oriented interest representation 43
1.3.2.4 Elements of process competence 45
1.3.2.5 Importance of process structure competence (PStC) 45
1.3.2.6 Importance of perspective change competence (PCC) 47
1.3.2.7 Importance of process support competence (PSuC) 53
1.4 Conclusion 55
2 Fundamental thoughts on the topic of interest representation and stakeholders 57
2.1 Differences of interest, stakeholders and translation conflicts 57
2.1.1 Complexity and differentiation 58
2.1.2 One theory of the “stakeholder” 64
2.1.3 Translation conflicts 65
2.2 Stakeholder orientation: perspectives of corporate management beyond the classic shareholder value approach in the face of more complex framework conditions 66
2.2.1 “Be ahead of change”: challenge of stakeholder orientation 66
2.2.2 Drivers of stakeholder orientation 67
2.2.2.1 Internet and digitisation 67
2.2.2.2 Climate change and demographic trend 69
2.2.2.3 Critical trends and globalisation and in a fully networked economic and financial world 70
2.2.2.4 New organisational structures for the representation of civil interests 71
2.2.2.5 Interim result 72
2.2.3 Ideal of the honourable merchant: a stakeholder-oriented concept? 73
2.2.4 Complex and dynamic perspectives of stakeholder orientation 74
2.2.5 Stakeholder theory: central contributions, development stages and selected key findings 76
2.2.5.1 Central contributions to the stakeholder theory 76
2.2.5.2 Three stakeholder theory development stages 77
2.2.5.3 Maturity phase as part of stake holder management 83
2.2.6 Stakeholder management and strategies 89
2.2.7 Example applications of the stakeholder view in marketing 95
2.2.8 Summary and outlook 99
2.2.9 Closing remarks 100
2.3 Importance of the intermediary in interest representation derived from mutual market relationship theories 101
2.3.1 Intermediaries 101
2.3.1.1 Definitions 101
2.3.1.2 Intermediaries explained using economic theories 103
2.3.1.2.1 Transaction cost theory 104
2.3.1.2.2 Search theory 106
2.3.1.2.3 Intermediation theory of the firm 107
2.3.1.2.4 Principal agent theory 108
2.3.1.3 Behavioural theories 110
2.3.1.3.1 Structural hole theory 110
2.3.1.3.2 Social exchange theory 111
2.3.2 Summary 112
3 Representation of interests: an approach. Fundamentals and introduction 115
3.1 Introduction 115
3.2 The representation of interests as a structured communication process 116
3.2.1 Question and definition 116
3.2.2 Concepts of interest representation: from investor relations to governmental relations 119
3.2.3 Representation of interests as an indispensable element of corporate communication 123
3.2.3.1 Representation of interests as an early warning system: identification of issues and trends 123
3.2.3.2 The representation of interests as a long-term project: structural support of decision-making processes 127
3.2.3.2.1 General 127
3.2.3.2.2 Information management 128
3.2.3.2.3 Strategy consulting 129
3.2.3.2.4 Events 130
3.2.3.2.5 Integration of corporate interests 131
3.2.3.3 The representation of interests as political crisis management: interest representation as “fire-fighting” 131
3.3 Legitimation of interest representation 134
3.3.1 Politics as the contest between various interests with the objective of consensual solutions 137
3.3.2 Interest representation as the aggregation of interests 140
3.3.3 Interest representation as a tool for forming communication interfaces between politics and the affected parties: necessity of an intermediary 142
3.3.4 Political science concepts for analysing and evaluating interest representation: overview 146
3.3.4.1 Neo-pluralism 146
3.3.4.2 Neo-corporatism 148
3.3.4.3 Exchange theory 150
3.3.4.4 Governance approach 152
3.3.5 Fundamentals of European law 154
3.3.5.1 Primary legal fundamentals 155
3.3.5.2 Regulations for lobbyists (code of conduct) and European Union officials 155
3.3.5.2.1 Regulations for lobbyists 156
3.3.5.2.2 Regulations for European Union officials 157
3.3.5.3 Further legal regulations and voluntary commitment of lobbyists 159
3.4 Summary 160
4 Politics as a process: paradigm shift from content competence to process competence in interest representation 165
4.1 Introduction and question 165
4.2 Content as the key element of politics? 167
4.3 Classic dimensions of politics: polity, policy, politics 170
4.4 Procedural dimension of politics 173
4.4.1 “Complexity trap” of polity: process competence for the political system in the European Union 173
4.4.2 Policy cycle 174
4.4.2.1 Problem definition 176
4.4.2.2 Agenda setting 177
4.4.2.3 Policy formulation and decision 178
4.4.2.4 Policy implementation 179
4.4.2.5 Policy evaluation 180
4.4.2.6 Policy termination 181
4.5 Temporal dimension of politics 182
4.5.1 Endogenous time slots 183
4.5.2 Exogenous time slots 184
4.5.3 Structural time slots 185
4.6 Political actors 186
4.6.1 Individual actors 188
4.6.2 Collective and corporate actors 190
4.6.3 Institutional actors 191
4.7 Political networks 194
4.8 Laws of (political) decisions 198
4.8.1 Homo economicus or homo politicus? 199
4.8.2 Decision-making by homo politicus 203
4.9 Summary 211
5 European Union as the target of interest representation: political system and peculiarities in comparison with member state systems 217
5.1 Introduction and question 217
5.2 Short history of European integration 218
5.3 Fundamental changes due to the Treaty of Lisbon 226
5.3.1 “Lisbon”: Treaty or Constitution? 227
5.3.1.1 Genesis of the Treaty of Lisbon 228
5.3.1.1.1 Context: genesis of the Constitutional Treaty and constitutional crisis 228
5.3.1.1.2 Way out of the constitutional crisis 230
5.3.1.2 How the chosen process determined the substance of the Treaty of Lisbon 232
5.3.1.2.1 Base camp and game of chess 233
5.3.1.2.2 Berlin Declaration and Sherpa consultations: informal processes as the way to success 234
5.3.1.2.3 A negotiating mandate without freedom to negotiate 236
5.3.1.2.4 Conclusion 238
5.3.1.3 Evaluation of the differences between the Constitutional Treaty and the Treaty of Lisbon 238
5.3.2 Strengthening the EU externally: the EU as a global player 241
5.3.3 Strengthening the EU internally: transition from the principle of unanimity to the majority principle in the Council of the EU is becoming the usual case 245
5.3.4 Strengthening of the European Parliament 248
5.4 Integration theories and the multi-level system of the European Union 249
5.4.1 Federalism 250
5.4.1.1 Federalism as a political objective 251
5.4.1.2 Federalism as a political science integration theory 251
5.4.2 Neo-functionalism 252
5.4.3 Liberal intergovernmentalism 255
5.4.4 Supranationalism 257
5.4.5 Multi-level governance 258
5.4.6 Conclusion 263
5.5 Political stakeholders in the European Union 263
5.5.1 European (supranational) level: overview of the institutions of the European Union 264
5.5.1.1 European Parliament 264
5.5.1.2 European Council 269
5.5.1.3 Council of the European Union (Council of Ministers) 269
5.5.1.4 European Commission 272
5.5.1.5 Court of Justice of the European Union 276
5.5.1.6 European Central Bank 276
5.5.1.7 European Court of Auditors 277
5.5.1.8 Other institutions 278
5.5.1.8.1 European Economic and Social Committee 278
5.5.1.8.2 Committee of the Regions 280
5.5.2 Member state (national) level 280
5.5.2.1 Member state (“permanent”) representations 282
5.5.2.2 Regional representations 283
5.5.3 Civil society (non-state) level 286
5.5.3.1 Associations 288
5.5.3.2 Organisations and public interest groups 289
5.5.3.3 Media 291
5.6 Summary 293
6 Legislative procedure and other legal regulations as the framework of interest representation in the European Union 297
6.1 Introduction and question 297
6.2 Bases of legislation in the EU after Lisbon 297
6.2.1 General 298
6.2.2 Classification of legislative acts after the Treaty of Lisbon 299
6.2.3 Legislative procedures in the European Union 300
6.2.3.1 General 300
6.2.3.2 Ordinary legislative procedure 301
6.2.3.2.1 Introduction of the legislative procedure: right of initiative of the EU Commission 302
6.2.3.2.2 Further procedure in the Council and Parliament: readings, opinions and conciliation procedures 304
6.2.3.2.3 First reading in the European Parliament 304
6.2.3.2.4 First reading in the Council 305
6.2.3.2.5 Second reading in the Parliament and Council, opinion of the Commission 305
6.2.3.2.6 Procedure in the conciliation committee 307
6.2.3.2.7 Third reading in the Council and Parliament 307
6.2.3.2.8 Publication, announcement and entry into force 308
6.2.3.3 Legislation by the EU Commission according to Articles 290 and 291 TFEU, particularly comitology 308
6.2.3.3.1 Delegated legislation (Article 290 TFEU) 309
6.2.3.3.2 Implementing legislation by the EU Commission according to Article 291 (2) TFEU 310
6.3 Access to the institutions of the European Union 312
6.3.1 General 312
6.3.2 Legal bases of regulation 314
6.3.3 Legal framework of access to the individual institutions 316
6.3.3.1 Regulation of access to the Council of the EU 316
6.3.3.2 Regulation of access to Commission members and civil servants 316
6.3.3.3 Transparency Initiative/Transparency Register 317
6.3.3.3.1 Boundary conditions and content of the Transparency Register 317
6.3.3.3.2 Alternatives to the Transparency Register: binding quality criteria for interest representation 319
6.3.3.4 Regulation of access to Members of the European Parliament 321
6.3.3.5 Regulation of access to the Committee of the Regions (CoR) and the Economic and Social Committee (EESC) 322
6.3.4 Consequences for the practice of interest representation 322
6.3.4.1 Decisions without decision-makers? 323
6.3.4.1.1 European Union “complexity trap”: is there the one decision-maker? 323
6.3.4.1.2 Ordinary legislative procedure (Article 294 TFEU): the number of decision-makers is increasing 323
6.3.4.1.3 Informal trialogue as an additional - informal - decision-making level 324
6.3.4.1.4 Complexity and multi-dimensionality of the procedures and process competence in interest representation 326
6.3.4.2 Majority decisions amongst 27 member states as a strategic risk for companies: necessity of “European coalition building”? 326
6.4 Summary 329
7 Governmental relations: process management in practice 331
7.1 Introduction and question 331
7.2 General 331
7.3 Essential element of successful interest representation: stakeholder management 334
7.3.1 Concept of stakeholder management in the area of political interest representation 334
7.3.2 Stakeholder management in practice 337
7.3.2.1 Step 1: identification of relevant stakeholders 338
7.3.2.2 Step 2: stakeholder mapping - categorisation and hierarchical structure 341
7.3.2.3 Step 3: information management - establishment and administration of a stakeholder database 342
7.4 Interest representation instruments 344
7.4.1 Structural instruments 345
7.4.1.1 Collective forms of organisation: interest representation through associations 345
7.4.1.1.1 General heterogeneity problem 345
7.4.1.1.1.1 Compulsion to reach a compromise at association level 345
7.4.1.1.1.2 Consequence: conflict between membership logic and influence logic 348
7.4.1.1.2 Association-based interest representation “from the inside” and “from the outside” 350
7.4.1.1.3 Cultural differences between the EU level and member states as a problem for associations 351
7.4.1.1.4 European and national associations 351
7.4.1.1.4.1 European associations 351
7.4.1.1.4.2 National associations 353
7.4.1.2 Non-collective forms of organisation 354
7.4.1.2.1 In-house interest representation: own corporate representative office 355
7.4.1.2.1.1 Role and activities of an in-house lobbyist 356
7.4.1.2.1.2 Personal requirements for a lobbyist 356
7.4.1.2.1.3 Central problem: trust cannot be bequeathed 357
7.4.1.2.2 External service providers 357
7.4.1.2.2.1 Public affairs agencies 358
7.4.1.2.2.2 Law firms 358
7.4.1.2.2.3 Governmental relations agencies 360
7.4.1.2.2.4 Project-related or structural (long-term) approach? 362
7.4.1.2.2.5 Think tanks 363
7.4.1.2.2.6 Posting internal employees to the institutions 364
7.4.1.3 Costs of the various instruments 365
7.4.1.3.1 Costs of an association 365
7.4.1.3.2 Costs of a corporate representative office in Brussels 366
7.4.1.3.3 Costs of an external service provider 369
7.4.1.3.3.1 Public affairs agencies 370
7.4.1.3.3.2 Law firms 371
7.4.1.3.3.3 Governmental relations agencies 371
7.4.2 Process-oriented instruments 374
7.4.2.1 Mono process-oriented instruments 374
7.4.2.1.1 Telephone call 374
7.4.2.1.2 SMS 375
7.4.2.1.3 E-mail 376
7.4.2.1.4 Personal discussion 377
7.4.2.1.5 Briefing 377
7.4.2.1.6 Opinion in the legislative procedure 378
7.4.2.1.7 OnePager 378
7.4.2.2 Poly process-oriented instruments 380
7.4.2.2.1 Workshop 380
7.4.2.2.2 Parliamentary evening 382
7.5 Implementation in practice: overall model for structuring effective and efficient interest representation 383
7.5.1 Setting quality benchmarks: key elements of effective interest representation for a company 383
7.5.2 Co-ordination of the instruments by the company 387
7.5.3 Documentation of the starting point and objective: definition of a general corporate requirement profile in the field of interest representation 389
7.5.4 Implementing and successfully undertaking interest representation projects: fundamental steps 391
7.5.4.1 Documentation of the content-related objective and continuous checking of political feasibility 391
7.5.4.2 Process-oriented situation assessment and strategy planning 393
7.5.4.3 Drafting and submitting one or more OnePagers 393
7.5.4.4 Flanking the OnePager with other structural and process-oriented instruments (mutual information transparency) 394
7.5.4.5 Supporting decision-making processes at legislative and executive level 395
7.5.5 Conclusion 396
7.6 Summary 396
8 Training: ways to becoming a governmental relations manager 403
8.1 Introduction and question 403
8.2 Framework conditions and general requirements on a lobbyist 403
8.2.1 Breaking down and controlling increasing complexity 403
8.2.2 Deciphering the complex multi-level system of the European Union 408
8.3 Requirements on a lobbyist 410
8.3.1 Knowledge of the world of politics and the world of stakeholder groups 410
8.3.1.1 Interest representation as an intermediary system 410
8.3.1.2 Requirements on the part of stakeholder groups 413
8.3.1.2.1 Information 413
8.3.1.2.2 Commercial management thinking and implementation of the clients’ (political) objectives 414
8.3.1.2.3 Professional representation of clients’ interests 415
8.3.1.2.4 Technical know-how and good contacts 416
8.3.1.2.5 Soft skills as essential tools: social skills, intercultural and linguistic skills, integrity 417
8.3.1.2.6 Integrity and compliance 419
8.3.1.3 Requirements on the part of politicians 419
8.3.1.3.1 Information 419
8.3.1.3.2 Information transparency and professional information mediation 421
8.3.1.3.3 Understanding of political processes and culture 422
8.3.1.3.4 Integrity and compliance 423
8.3.1.4 Conclusion 425
8.3.2 Development of skills for the structural and long-term support of political processes 426
8.3.2.1 Process competence and an understanding of complex political systems 427
8.3.2.2 Reduction of complexity for politicians and stakeholder groups 429
8.3.2.3 Revolving door as an answer? 431
8.3.2.3.1 Switch from politics to commerce 432
8.3.2.3.2 Problems of the different socialisation of politicians and decision-makers from commerce 433
8.3.2.3.3 Revolving door as a dead end? Image problems for politicians and stakeholder groups 435
8.4 Status quo of vocational education and further training for lobbyists 436
8.4.1 Existing methods of education and further training 436
8.4.2 Objectives and content of the current education and further training 439
8.5 New approaches in education and further training 441
8.5.1 European law module 443
8.5.2 Political science module 444
8.5.3 Process competence and complexity reduction module 445
8.5.4 Intercultural skills module 446
8.5.5 Language module 446
8.5.6 Practical module 447
8.6 Summary 448
9 Case studies on interest representation projects with structural process support 451
9.1 Case 1: “advertising bans for spirits, beer and wine?” 452
9.1.1 Circumstances/initial situation 452
9.1.2 Step 1: documentation of the (content-related) objective and continuous checking of political feasibility 455
9.1.3 Step 2: procedural situation assessment and strategy planning 456
9.1.4 Step 3: drafting a OnePager and submitting it to previously identified addressees at the legislative and executive level 459
9.1.5 Steps 4 and 5: implementation of the OnePager and supporting decision-making processes at legislative and executive level 461
9.1.5.1 Representation of interests vis-à-vis the European Commission 461
9.1.5.2 Representation of interests vis-à-vis the Council 461
9.1.5.3 Representation of interests vis-à-vis the European Parliament 462
9.1.6 Result: achievement of objectives 463
9.2 Case 2: “regulation for defining the modalities for achieving the objective of reducing the CO 2 emissions of new passenger cars by 2020” 463
9.2.1 Circumstances/initial situation 463
9.2.2 Step 1: documentation of the (content-related) objective and continuous checking of political feasibility 465
9.2.3 Step 2: procedural situation assessment and strategy planning 466
9.2.4 Step 3: drafting one or more OnePagers and submitting them to previously identified addressees 467
9.2.5 Step 4: flanking the OnePager with other structural and process-oriented instruments (mutual information transparency) 468
9.2.6 Step 5: supporting decision-making processes at legislative and executive level 469
9.2.6.1 Representation of interests vis-à-vis the European Commission 469
9.2.6.2 Representation of interests vis-à-vis the Council 470
9.2.6.3 Representation of interests vis-à-vis the European Parliament 471
9.2.7 Result: achievement of objectives 472
10 Future challenges 473
10.1 Professionalism means translation competence 473
10.1.1 Classic professions 473
10.1.2 A new form of professionalism? 477
10.1.3 Professionalism as translation competence 481
10.1.4 Brief appendix: interest representation re-thought 483
10.2 Knowledge infrastructures 484
10.2.1 Access to external knowledge is now more important than ever before 484
10.2.2 Knowledge infrastructures are the solution, but also the problem at the same time 486
10.2.3 Knowledge infrastructures influence the cohesion and the future viability of our societies 487
10.3 Open policy - on a foundation of interest representation 488
10.3.1 Let’s open up then: everything “open” or what? 488
10.3.1.1 Access 489
10.3.1.2 Epistemic dimension 490
10.3.1.3 Structural dimension 491
10.3.1.4 Dimension of legitimacy 491
10.3.2 Then go for it: strategic stimuli for interest representation 492
10.3.2.1 Process 492
10.3.2.2 Opportunity 493
10.3.2.3 Cascade 493
11 Summary and outlook 495
11.1 Interest representation as a business management asset for companies, associations and organisations 495
11.2 Objectives of interest representation (involvement in decision-making processes) 496
11.3 Framework conditions - reform due to the Treaty of Lisbon 497
11.3.1 Treaty of Lisbon: de facto United States of Europe! 498
11.3.2 Strengthening the European Union 500
11.3.2.1 Outwardly 500
11.3.2.2 Inwardly 501
11.3.3 Multi-level system, ordinary legislative procedure, informal trialogue 501
11.3.3.1 Multi-level system 501
11.3.3.2 Ordinary legislative procedure (Article 294 TFEU): the number of decision-makers is increasing 502
11.3.3.3 Informal trialogue: an additional decision-making level 502
11.3.4 Paradigm shift from content to process competence 503
11.3.5 Conclusion and outcome 504
11.3.5.1 Increase in the complexity of European decision-making processes 504
11.3.5.2 Paradigm shift in interest representation: process competence 505
11.4 Outlook: urgent need for reform to overcome the governance crisis within the EU 507
Appendix 511
List of abbreviations 511
List of figures 515
References and further reading 519
Index 567
About the authors 575
