Public Affairs: A Driver of Corporate Advantage

Stefan Borst, Senior Partner Advocacy Strategy

In boardrooms, Public Affairs is often misunderstood. The costs are questioned and results seem hard to quantify. Too many executives still see advocacy as a discretionary cost rather than a strategic lever.

And yet, when measured properly, lobbying - especially in the US but also within the EU - is among the highest-return investments a company can make. The numbers are not soft - they are as compelling as any capital project or M&A transaction. The challenge is perspective: advocacy must be seen not as a one-off campaign but as a portfolio of long-term bets.

Why Advocacy Looks Small (and Isn’t)

On the surface, any single engagement with policymakers may feel minor: a regulation delayed, a clause rewritten, a conversation that never makes the news. But behind these moments lies a simple fact: companies that invest consistently in public affairs outperform those that don’t.

Research shows lobbying ROI between 140% and 156% - and these figures are from ten years ago. I expect them to be even higher today where government regulation impacts even more on business operations. Some policy wins have already delivered significantly higher returns. U.S. corporate tax reforms produced payoffs in the thousands of percent for the firms that pushed the hardest. In Europe lobbying by financial interests during the Corporate Sustainability Due Diligence Directive (CSDDD) negotiations led to exclusions or lenient treatment for financial services - particularly due to effective engagement with the EU Council. In other words: most advocacy efforts won’t make headlines, but breakthrough can tilt markets and unlock millions if not billions.

The Myth of “Wait Until It Matters”

Many organizations fall into the trap of treating lobbying as crisis response or fire-fighting exercise. They mobilise only when an act directly threatens profits. By then, it’s usually too late for real influence. The most important shaping of rules happens long before legislation is drafted and it requires a steady investment into monitoring, analysising and engagement.

The companies that win and thrive are those that engage continuously, not episodically. Their advocacy teams become early warning systems, spotting risks before they hit balance sheets and identifying opportunities competitors overlook. According to science that foresight alone is worth around 90 million Dollar per year in avoided costs and smarter decisions.

Why Leadership Presence Is Non-Negotiable

Here’s the part that Public Affaris practitioners rarely say directly: money isn’t enough.

Lobbyists and trade associations open doors, but real influence comes when senior executives walk through them and act. Policymakers want to hear directly from those who make strategic decisions. A CEO visit signals commitment, seriousness, and credibility that no consultant or other corporate representative can replicate.

If Public Affairs is to deliver its full value, the C-Suite must be visibly engaged - on the ground, in conversations, and part of the story. And yes, they should be trained to do so, just like they get trained to deliver compelling speeches or TV appearances.

Think Like an Investor, Not a Firefighter

Executives are used to making bets in uncertain environments: new products, acquisitions, venture stakes. Advocacy belongs in the same category. You place multiple bets, knowing most won’t visibly pay out, but that a few will transform the business.

That is why the right question isn’t “What did this campaign deliver last quarter?” but rather:

• How strong is our pipeline of policy opportunities (and did we consider all angles)?

• Where are we positioning for the next breakthrough?

• Are we investing steadily enough to ensure we don’t miss the rare chances that matter most?

An excellent article outlining why a venture-capital mindest would be helpful in Public Affairs: https://www.linkedin.com/pulse/public-affairs-needs-venture-mindset-ben-schroeter-vpd2e?utm_source=share&utm_medium=member_ios&utm_campaign=share_via

A Call to the C-Suite

The rules that govern markets are being rewritten faster than ever - on technology, energy, trade, and competition. Companies can either shape those rules or be shaped by them.

To win, leadership must commit three things:

1. Funding: Treat public affairs as a capital investment with asymmetric upside, not as a cost line to be trimmed.

2. Visibility: Put senior voices into the debate - CEOs and CFOs included. Influence comes from presence.

3. Patience: Accept that returns may take more time than a quarter. The biggest wins may even take years. But when they arrive, they can completely turn the competitive landscape in your favour.

   
   

Final Word

Public Affairs is not only about smoothing reputations or “getting along” with regulators. It is about creating corporate advantage in a non-market arena and as tangible and measurable as any financial strategy. Companies that underinvest or delegate Public Affairs entirely to others will always be rule-takers instead of rule-shapers. Those that commit resources, leadership presence and long-term focus will discover what seasoned practitioners already know: the payoff is extraordinary.