US companies and political influence: how business can read the government landscape better

Abstract

Purpose

This paper aims to help executives understand how to interact with government in today’s chaotic political environment.

Design/methodology/approach

This paper is based upon voluminous research analyzing a unique data set downloaded from a number of sources, including the financial reports of public companies and the contribution reports filed by political action committees and candidates for Congress.

Findings

This study found that political decision-making is constrained by a set of institutions the authors call the political landscape. This framework includes three factors that businesses looking to influence government and the elected officials themselves must consider: the politicians’ ideology, the political trends of their constituency and their existing relationships. While these factors constrain the ability of politicians and business advocates to successfully pursue certain policy positions, businesses may be able to influence these factors through effective political activism, and in so doing, they may be able to push key government decision-makers to alter their positions.

Practical implications

This research will help executives understand how government operates in this new era of uncertainty. Being able to read the political landscape will enable business leaders to anticipate and perhaps even mitigate governmental threats to their business.

Originality/value

This research updates the market theory of politics which has received limited empirical support. It is especially valuable in the wake of Supreme Court’s decisions that have increased the potential for business to impact politics.

Citation

Greiner, M. and Lee, J. (2021), "US companies and political influence: how business can read the government landscape better", Journal of Business Strategy, Vol. 42 No. 1, pp. 69-75. https://doi.org/10.1108/JBS-09-2019-0178