08/01/2024
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Removing Barriers - Building Trust: A Revolutionary Collaboration with European Regions
by Frank Farnel
Head Global Government & Public Affairs | Member of Morgan Philips Life Sciences Advisory Board
The process of policy making is essential for governments and organizations to establish and enforce beneficial policies. It entails identifying issues, setting goals, evaluating options, making decisions, implementing strategies, and monitoring outcomes. Policy making is a critical concern in a wide range of industries and sectors, from local communities and regions to entire nations and the European Union.
In the energy sector - production, distribution and sale of energy, particularly also in energy infrastructure (among others, the fundamental facilities and systems for producing, transmitting and distributing energy), governments have to navigate administrative, political and legal obstacles such as applications, subsidies, permits, and insurance.
In the following we will analyse the case study of General Electric where the author was managing Public Affairs and communications of the Energy division in the EMEA region.
GE Energy as a US multinational present in Europe that has established its European HQ in Belfort, France faced challenges in establishing trustworthy relationships with local, regional, national and European governments, similar to many other companies. The dynamic between companies and governments was often tense and strained. National preference is often a challenge that slows down , if not prevents investments in Europe.
Building and Rebuilding trust after the global financial crisis between the two parties was essential for GE Energy. Additionally, GE Energy aimed to position itself as an expert in the energy field, considering it was a US company striving to enhance its reputation in Europe.
This goal posed a particular challenge as it meant competing with European energy giants, Alstom and Siemens.
The objective was not only to influence sustainable and responsible policies but also to create business development opportunities with governments operating in complex and politically unstable environments.
These governments sought reliable and sustainable expertise to develop their energy grids.
The best practice outlined below provides insights into building trustful relationships with governments, positioning a company as the preferred supplier, and illustrates how thoughtfully crafted government and public affairs plans can drive organizational growth and unlock new market prospects.
This case study initially focused on the European regional market, but it ultimately expanded opportunities on a global scale. It opened new markets, bolstered existing ones, and established at that time GE Energy as the preferred energy partner in Europe, an area traditionally dominated by Siemens and Alstom.
Companies in the energy sector are mostly aware of the importance of working closely with governments and being able to treat them as customers. Market shaping, reputational management, and public and government affairs are keys in achieving this.
The belief that engaging in ethical and responsible debates, can eliminate unnecessary barriers led to our collaboration with the Assembly of European Regions (AER), the only collaboration of its kind worldwide.
This partnership created a unique connection between renowned energy experts and regional decision-makers. It demonstrated that political organizations and corporations can and should work together to remove obstacles and achieve shared goals. In challenging political and economic times, this collaboration proved vital for GE Energy in Europe and beyond.
To ensure the company technologies and solutions remained relevant, a comprehensive understanding of the field was needed. Indeed, at a time when governments were struggling to recover from the global financial crisis, it was the regions and local governments that were the true drivers of energy projects. They had the necessary budgets and resources to successfully invest in responsible alternative energy development. As a result, businesses needed to engage with them. The focus should be on decision-making at this level, not just on national ones. Consequently, any national activities should solely aim to strengthen market-shaping efforts and influence decision-making in favour of local and regional levels.
What is true here for the energy sector is also true in many other sectors of activity. Often, these decision levels are not sufficiently taken into account, mainly due to a lack of understanding of the decision-making processes between different layers of government.
Additionally, there are complexities associated with cultural interpretations of political and government power, which vary from country to country and region to region. The key is to be able to adapt to these factors and maintain coherence in representing the company's growth trajectory, while also serving important public interests in collaboration with governments.
Choosing the right organization to partner with
At this stage of the article, it is important to highlight that we had the choice to engage with the Regions of Europe either through the Committee of the Regions or the Assembly of European Regions.
While the Committee of the Regions, as part of the decision-making process of the European Commission, is an essential organization, it is also cumbersome and lacks the necessary agility and responsiveness when it comes to addressing issues like the one, we had to deal with. Our goal was to establish a partnership between the AER and GE Energy in a way that this agreement could, by example, positively influence European public policies in the energy sector (for instance, topics related to energy grid optimization were at the forefront of European legislators' priorities).
Moreover, in our field of government relations and public affairs, it is crucial to be highly creative (often referred to as thinking "outside the box") while remaining realistic about the results to be delivered within tight deadlines that must balance European political agendas and the production capacities of our companies. All these points, among others, led GE Energy and the AER to sign a Memorandum of Understanding that laid the foundations for future and fruitful collaboration.
GE Energy / AER: a Win-win partnership
In this instance, it meant being closely connected to the regions, local governments, and urban decision-makers. The AER on the other hand, saw the immense value of working with GE Energy as their European energy expert. Through this set up cooperation, we were able to match the citizens' needs with applicable solutions.
This collaboration also became a vital part of the business development strategy. Through initiatives like the annual General Assembly of the AER, where regional presidents from 33 countries gather, together with GE we had invaluable opportunities to engage with key policymakers, understand their challenges, and offer our technology solutions. We also organized the AER General Assembly at our headquarters in Belfort, France, in collaboration with local authorities. This unprecedented event brought together over 1,000 European political decision-makers, further solidifying GE Energy's position as a natural expert in energy technologies. This successful operation will be further expanded with over 25 held workshops across Europe.
Strengthening Partnership Reputation: Creation of a new Brand
Our built collaboration with the AER and our strong relationship with media groups like EURACTIV have allowed us to engage with stakeholders at a local level. Through debates, workshops, and conferences, we have not only transmitted valuable technical know-how and expertise, but also enhanced our ability to connect with governments, media, and academics. The approach to use strategically coordinated government relations, public affairs and communication reinforces the position of GE as the region's energy expert and thus builds the bridges needed.
Through this public-private partnership, we were able to engage regions where even the States had difficulty starting a discussion: For instance, we organized a meeting of the Black Sea regions with AER to address energy and water treatment issues.
International recognition and development of new business opportunities
This public-private partnership was so successful that it was recognized as a best practice for how businesses and regional governments can work together at COP 15 in Copenhagen.
Opportunities often lead to others which is why lateral thinkers are essential during the process and implementation of government relations and public affairs strategies and tactics.
The partnership between GE Energy and AER provided GE also with the opportunity to internationalize this political initiative for the growth of their group. The newly created R20, led by the President of the California region, Arnold Schwarzenegger, brought together the regions most involved in climate change.
It was crucial for GE Energy to become the natural expert for these regions of the world. They took advantage of the momentum created by the public private partnership with the European regions and succeeded.
For instance, later on, a delegation from GE Energy travelled to Delta State, Nigeria, following reports we established with the presidency of the Nigerien Region. The presidency organized a press conference after the meeting with the ministers positioning GE Energy as the recognized expert with whom the Government wanted to investigate partnership possibilities.
These meetings had been very effective, both for the reputation of the company, and the benefit of the region we were interacting with, paving the way for technical and commercial collaborations between the worldwide regions and GE.
As the aligned government relations, and public affairs programs with the help of lateral thinking showed its enormous impact and success, other sectors of the company started to prepare for a similar process. Among those the healthcare sector.
This public affairs, government relations and market shaping campaign, demonstrates the competitive advantage that a professional and strategic approach to this function can provide for a company or organization.
Alike success is possible in all sectors and practices, as long as professionals in the field are involved or departments within companies are fully empowered to carry out their activities with rigorously selected individuals who can successfully manage these multidisciplinary, international, and complex tasks.
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