Policy advocacy needs narratives

Few companies are successful at external affairs, according to new McKinsey research. Narrative can help fix this.

CEOs are pretty used to getting what they want. But results from a recent McKinsey survey show that they’re not getting what they want when it comes to external affairs. While half the executives surveyed cited external relations as a priority for their firms, less than a quarter of thought their business was particularly effective at it, i.e. “frequently successful both at shaping government policy and/or regulatory decisions and at managing their corporate reputations among civil society groups.”

Achieving sector leadership

Reputation and regulation management are closely linked. A reputation as a credible and forward-thinking sector leader on policy and key societal issues positions a company to lead its sector’s thinking and policy advocacy work with politicians and their stakeholders.

It allows a company to take the lead in working with governments, experts and civil society to develop the right mix of policy and public and private sector initiatives to tackle near-universal sustainability issues; most obviously in transport, housing, energy, healthcare, infrastructure and education.

Policy leadership needs to be complemented by a sustainability strategy that demonstrates how the company is doing its part to tackle these issues, in its own right and as a driver of change in its sector.

The narrative advantage

McKinsey identifies the capability to build fact-based narratives that support positions as a key factor in separating companies that are successful at external affairs from those that are not. This is hardly a surprising discovery. A company can’t expect politicians and regulators to take them seriously if its strategy and narrative doesn’t recognise the issues facing them.

A strong, clear and credible narrative is an effective way of bringing together the often disparate disciplines of communications, sustainability and policy. Where possible, a company’s narrative should reference its business environment and the forces that are shaping it – from societal expectations to demographics and regulatory trends.

Aligning corporate strategy and external affairs

Successful companies align their external affairs agenda with their corporate strategy narrative. This relies heavily on the CEO supporting external affairs activities. It’s difficult to get this engagement unless the CEO recognises that the external affairs agenda reflects company strategy.

A recent PR Week survey of communications directors mirrors the McKinsey findings: 42% said that driving understanding of the corporate strategy amongst all stakeholders was one of the most important aspects of corporate communications. And a quarter said that they need to do more to develop the company narrative and communicate it.

Integrating communications

Getting the narrative and its deployment right also addresses one of the key communication challenges identified by almost half of the communications directors: integrating communications activity across the business.

Executing an effective digital and social media strategy and managing that presence are some of the other biggest challenges identified by communications directors. A clear narrative provides a common underlying theme to a variety of sub-themes and messages, helping to filter out the noise that can easily be generated by the demands of myriad news and social media.

Heads of communication and corporate affairs are faced with an increasing number of demands, both internal and external, but often have less internal resources to address these demands. A properly embedded narrative can provide the discipline and consistency to ensure focus on the most pressing issues affecting a company’s future.