David Coen and Alexander Katsaitis / Jul 2022
Recognizing the potential impact of the single market, over the last 30 years UK business has invested wisely in lobbying capacity building up a successful government-affairs profile in Brussels (see Coen, Katsaitis, Vannoni 2021). In part this reflected its ability to make insightful and credible strategic choices. It also reflected its dexterity in gaining access into EU policymaking via UK actors within EU institutions. As such, Brexit and the exit of UK officials from key EU institutions places UK business at a lobbying disadvantage.
What can UK business do to maintain its presence and influence within Brussels’ government-affairs?
As a starting point, EU lobbying for UK business post-Brexit will become costlier. Since it is no longer a part of the EU’s constituency it faces less access to Brussels’ policymakers and holds less leverage than EU counterparts. Moreover, as Westminster becomes the main policymaker influencing regulatory implementation for UK business, resources will have to be re-routed from across the channel. The early data is sobering: Comparing the mobilization of German, French, and UK interests before and after Brexit: UK activity is far less (see figure below, see also Coen and Katsaitis 2022). Nevertheless, there are at least two key actions that UK business can take to maintain its relevance and non-market competitive strategies.
Figure: Comparing registrations of nationally based interest groups from the UK, France, and Germany on the EU’s Joint Transparency Register, before and after Brexit.
First, Brexit’s impact will not be homogenous. Specifically, policy areas that are primarily technical and regulatory in nature tend to require expertise for high quality policy outputs. As such, interest groups that can demonstrate expert-knowledge are likelier to be invited at meetings and consultations. British business can benefit here by investing significantly in maintaining its reputation as the provider of reliable and trusted expertise, especially in areas where it has advanced know-how. Some of the most notable examples here are digital-tech, pharmaceuticals, and aerospace-tech.
Conversely, companies mobilizing in more politicized policy fields that are tightly linked to the national domain and tend to be more (re-) distributive such as agricultural or fisheries policy; might have to make some hard but necessary choices on their corporate political activity in Brussels. That means reinforcing activity within the UK however, it may also require shifting attention to other national capitals within and outside the EU. How embedded UK business is in the supply chain and links to other specific member states will be decisive in these choices. That is to say, the UK government’s increased impact on British business calls for additional attention. Simultaneously, international companies are dependent on regulations that are decided in Brussels; but also discussed and implemented in other countries which serve as key markets for UK products. These markets might require political engagement.
Second, direct access to EU institutions and policymaking procedures is minimized due to the UK’s exit from Brussels. However, business can maintain channels of communication and influence via EU alliances and associations. In particular, by mobilizing advocacy coalitions and civil society partnerships, active membership in trade and professional associations, and engagement in EU think tanks. Naturally, in the post-Brexit environment UK preferences may not necessarily be at the top of transnational associations’ agenda, nevertheless common areas of interest will remain represented.
Discussions around the UK-EU relationship post-Brexit are still unfolding, making long-term predictions about business strategies in Brussels harder. In the short and medium term, UK business can maintain a purposeful presence within EU policymaking; by diversifying its strategic toolbox, mobilizing in closer step with other interests, and operating in targeted policy areas where expertise is likelier to grant it access.