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Phil O’Reilly: Business council deserves a chance

By Phil O'Reilly, September 2018

With the issue of confidence still riding high on the business agenda, sparking speculation across business communities and industry camps alike, economic forecasters are gripped by the topic. Many are on high alert looking for any indication of change. Others are almost willing an upturn.

And yet the reaction to the formation of a Business Advisory Council – arguably a step towards positive change – has been somewhat curious.

Chaired by Christopher Luxon, the CEO of Air New Zealand, the business council will be set up as a direct listening post for business to address concerns around confidence. But there has been criticism that the council will only represent the big end of town, that it will not take into account the voices of small business, and that the Government may not actually pay sufficient attention to what it says.

If we jump to conclusions about whether the new business council will or won’t do a good job before it has even commenced, we will do nothing for business confidence whatsoever.

Of course, it is easy to be cynical and think that this latest business council is being formed so that the Government can listen to advice that it might favour, over more challenging advice already being given by the traditional business membership organisations.

Yet, if we jump to conclusions about whether the new business council will or won’t do a good job before it has even commenced, we will do nothing for business confidence whatsoever.

There is value in stepping back here and thinking about the role of the business voice, where it sits with any government and what responsibility we need to take ourselves.

Firstly, setting up an advisory group is nothing new. The National government had a small business advisory group, while the Helen Clark-led Labour government had a growth and innovation advisory board, made up mainly of larger businesses but including the likes of BusinessNZ.

Additionally, it is worth understanding what the Government itself is trying to achieve.

In the Prime Minister’s speech to the Auckland business audience, where she announced the formation of the council, she launched a business partnership document in which she outlined the Government's focus on three main economic development themes – inclusion, sustainability and productivity. I’m sure that any sensible business person would agree that these are very important themes for New Zealand to consider, and that these add perspective to the need for the council. 

Secondly, the business council will be just one advisor to the Government. It won’t be elected so will not be representative of all business. It is therefore the job of all business to ensure that ministers hear all concerns.

New Zealand already has many business voices. Some simply representing themselves, others representing small groups as well as very large business. They each serve different purposes and have relevance and standing in different ways. 

Likewise, representative business organisations have an explicit mandate from their members to speak truth to power and to say what their members think and feel. Although they are constrained by the need for a consensus outcome for members, this voice can often be a very powerful one with politicians and government officials.

The point here is that business shouldn’t sit back and simply allow the council to be the only voice. The new business advisory council is a welcome addition to the business advocacy landscape, but it is only an addition.

This type of voice is usually the best and most efficient business voice: it often understands a bit about public policy-making and can act as the interface between business and politics.

The point here is that business shouldn’t sit back and simply allow the council to be the only voice. The new business advisory council is a welcome addition to the business advocacy landscape, but it is only an addition.

No one person or organisation has the only say and that is a very important thing in our democracy. It is, therefore, important that businesses support regional and sectoral groups vigorously to enable those voices to be truly represented and empowered in any debate. 

Finally, whether the Government listens and acts upon our advice is not an issue solely associated with the new business council. This is something that we should all be trying to achieve in our established business organisations and, indeed, every time we talk personally or as a small group to ministers, MPs and government officials.

'Stand for things, not against things'

I see one of the issues here is that business voices need to push forward solutions to the problems they have. In this sense, it is important for businesses and business organisations to stand for things more than they stand against things. 

Politicians and government officials are not just seeking out issues in isolation. They want to help business by providing solutions. Unfortunately, business and business organisations often let themselves down when they don’t go the extra mile past defining the problem.

In this context, the way in which businesses and business organisations think about solutions to common problems will be more valuable under this Government if they are aligned to the main economic themes the Prime Minister outlined – namely, inclusion, sustainability and productivity.

The creation of the Business Advisory Council is a positive move. It is an indication that the Prime Minister and her government are open to listening. So, let’s get in their ear.

 If business uses these themes as a framework, it is much more likely that proposals for improvement to the business environment will be treated seriously. 

In this noisy marketplace of persuasion and advocacy the most successful businesses and business organisations will be the ones that use appropriate language and a solutions-focused agenda. This will give businesses the best possibility of persuading the Government to alter its direction or not. 

With all this in mind, the creation of the Business Advisory Council is a positive move. It is an indication that the Prime Minister and her Government are open to listening. So, let’s get in their ear.