How to Approach Nonmarket Strategy and Corporate Political Activity
This chapter presents an overview of the theoretical approaches through which the corporate political activity (CPA) phenomenon can be analyzed. The number of related fields and disciplines, such as economics, political science, sociology, management, as
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How to Approach Nonmarket Strategy and Corporate Political Activity
2.1 Introduction This chapter begins with definitions and taxonomy of Corporate Political Activity as a Nonmarket strategy to clarify a domain where many disciplines and concepts overlap. The theme is not new, as abundant literature witnesses, but as often the case, only partially addressed. In this book, the focus is on Japan as a market for MNEs at a strategic management level, and the available research is generally centered on the West, often at a macro or industry level. Therefore, a short review of principal theoretical approaches will be conducted to finally choose to concentrate on the contributions of political science and strategic management. After a reflection on power, two essential analytical dimensions, influence and coalition, will be put forward as interpretive tools. These tools form the conceptual infrastructure on which the practical framework detailed in Chap. 3 will be built.
2.2 Definitions and Taxonomy Since the 1960s, an enormous amount of literature and research has been produced on the relationship between business and government, essentially in North American academia. The issue covers interests and actions of corporations and trade associations trying to influence legislative or regulatory processes, on a continuous or episodic (elections) basis with activities widely known as lobbying, Political Action Committees, © The Author(s) 2020 E. Romann, Nonmarket Strategy in Japan, https://doi.org/10.1007/978-981-15-7325-5_2
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contributions, coalition building, advocacy, grassroots mobilization, constituency building, and so on. The concept is generally referred to as corporate political activity (CPA), business political activity, political behavior, nonmarket activity with related keywords extending to corporate public affairs, political strategy, issue management, and so on. With time, however, the term corporate political activity (CPA) seems to have established itself among researchers. Therefore, in this study, the terminology will be generally unified under this term though it may happen that the words “lobbying” or “nonmarket strategy” are also used equivalently. As will be seen later, the term lobbying can be strictly defined as an information strategy, albeit in the common language, it rather evokes money and corruption. Money is also a CPA strategy (contribution for elections, etc.) but classified by Hillman and Hitt (1999) as a financial strategy. Moreover, it seems that there is a difference of connotation between Europe and the US, where the term lobbying is essentially used for the provision of information by individuals representing the firms’ interests, whereas in Europe, it implies political action in general. Turning now to the definition of corporate political activity (CPA), different contributions from previous researchers should be examined. In his seminal work, Epstein (1969) first makes a critical distinction between the most spectacular, but not necessarily the most important
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