Capitals of influence – creating a cohesive impact

Yesterday, together with the Public Affairs Council, Leidar hosted a roundtable on “Capitals of influence – creating a cohesive impact” in Oslo. 

The Norwegian capital is a “Capital of influence” in shaping the global sustainability discourse. Norway was the first country in the world to name a Minister of Environment. The first UN report on Sustainable Development “Our Common Future” was launched under the leadership of the Norwegian Prime Minister, Gro Harlem Brundtland, in 1987. And, more recently, Norwegian businesses and investors have been at the forefront of integrating ESG into the mainstream discourse and policymaking.

Yet Norway’s strong economic reliance on extractive industries poses a question of credibility in driving this agenda, and leading international media are challenging Norway on this paradox of carbon-based wealth and sustainability ambition. 

Our event attempted to answer the following questions:

• What new issues affect the work of international government relations? 
• What should Norwegian companies operating in international markets consider in the face of this more complex agenda? 
• What lessons can we learn from the trends within sustainability communications and how is this affected by the increased complications faced by business? 
• Are there national reputation-related factors that Norwegian businesses should be aware of?  

Whether a small company or a big corporation, we are all faced with a rapidly-changing global agenda and its impact on business. Research from the Public Affairs Council confirms that the geopolitical context and rising tensions have become the key concern for all types of companies. Paired with growing stakeholder expectations, this creates an environment in which the quest for impact becomes ever more important. The second big challenge and opportunity lies with sustainability and ESG agenda. And in our debate in Oslo, we shed light on a third: the difficulties of navigating reality and ambition.

The cross-section of issues management, covering global, ESG and national peculiarities, poses the highest risk for the international companies. On top of that, the current regulatory framework is characterised by inconsistency and frequent changes. Yet progress on the ESG agenda requires important capital investments which must be recovered over time.

Despite the richness of regulatory approaches to support sustainability, there are not enough incentives for companies to act. The need for smart regulatory approaches was a shared sentiment in the room. We also need a shift from punitive approaches towards incentivising “good” behaviors. 

What does cohesive impact mean in the current public affairs setting and what is Norway’s role? The key points of agreement at the roundtable were:

1. We need to shift gears and start race to the top in sustainability, not to the bottom. That requires a shift from reporting to action, with strategic advocacy as the enabler. 
2. Norway is a soft power nation that is well positioned to lead this move. In particular, Norwegian companies have the credibility of being early movers in many ESG files. 
3. There is a need for a coherent global regulatory landscape to unlock the potential of capex investment in sustainability innovation. Public affairs functions have a clear role to play in helping develop this. 
4. Finally, the interconnectivity of the issues, and the closer relationship between sustainability and competitiveness, require companies to break internal silos to protect themselves from adverse regulatory changes and unleash opportunities from ESG innovation. Politicians, investors and CEOs should expect to be increasingly challenged on double standards, opportunism and inaction.