According to Transparency International’s Global Corruption Barometer (2013), 58% of EU citizens believe that their national government is to a large extent or entirely controlled by a few big interests. Although with less emphasis, this belief is usually extended to European institutions as well. Indeed, the well-documented decline in trust in national and international executive and legislative bodies has been accompanied by a pessimistic perception of the influence of corporate and group interests on those institutions. As it turns out, this perception is not totally unjustified, although being mostly based on distorted premises.
The latter mainly relate to an array of surprisingly widespread misconceptions about the concept of lobbying: what it really is, who the actors of the lobbying process are, how it impacts democracy and the decision-making process, and finally, what the current regulation on lobbying is and what can be done to improve it. The aim of this article is to answer most of these questions, focusing, of course, on the European Union and its Member States.
Lobbying: beyond the myth
A comprehensive definition of lobbying is given in Transparency International’s 2020 report on the subject: “Lobbying is any direct or indirect communication with public officials, political decision-makers or representatives for the purposes of influencing public decision-making, and carried out by or on behalf of any organized group”. Hence, lobbyists are people carrying out such activities, working for organizations such as public affairs consultancies, law firms, NGOs, think-tanks, corporate lobby units or trade associations. This definition by itself allows us to go beyond the mythical representation of lobbyists seen in works of fiction such as “Thank you for smoking” or “House of Cards”, and start recognizing their work as a fundamental part of democratic decision-making.
Indeed, the activity of lobbying, also called interest representation, is not by definition aimed at capturing the decision-maker, but rather at providing them with all the information and expertise they need to actually take decisions. In an increasingly complex world, politicians and bureaucrats are forced to deal with increasingly complex, ambiguous and multi-stakeholder issues, such as cybersecurity, pharmaceuticals or environmental protection. Unfortunately, they rarely have, if ever, a complete understanding of the multi-faceted consequences of the decision and actions they take, either because they lack specific competences on the subject or because they have limited information on the relevant context.
In principle, a well-functioning lobbying system has two advantages with respect to this information or competence gap. The first takes the form of better informed and more efficient institutions and bureaucracies. The decisions and policies implemented within such an interest representation process are expected to tackle the target issue more precisely and with smaller collateral costs to the relevant stakeholders. Secondly, lobbying should promote a more participatory and inclusive vision of democracy, where citizens and stakeholders are both the main initiators and drivers of policy making. This would imply greater responsibility and involvement of civil society on one hand, and greater accountability for institutions and bureaucracies on the other.
Ça va sans dire, the interest representation process also benefits those whose interest is being represented. Indeed, this is usually the risk people fear the most regarding lobbying: if a decision has positive effects on a large cohort of relatively powerless and disinterested individuals, but negative effects on a small group of powerful and concerned individuals, are we sure that those in charge will manage to resist the organized and persistent pressure of the latter in favor of the more general interests of the former? The answer to this variation of the famous “tragedy of the commons” problem is: it depends. Where the practice of lobbying is regulated in such a way to guarantee sufficient levels of transparency, integrity and fairness, the risk of unbalanced influence is minimized, and the overall soundness of democracy is greatly improved. Where instead this is not the case the risk is greater, and it becomes difficult to distinguish interest representation from corruption.
Whether we like it or not, market forces operate even in the realm of politics, and in order for the democratic process and society in general to benefit from the work of lobbyists, it is crucial that knowledge and competence remain the only currencies accepted in exchange for influence. When money and soft power become (il)legal tender, the political market fails.
Regulation on interest representation
To ensure that the “good” kind of interest representation emerges in a country, it is necessary for its legal system to recognize the practice and to regulate it. However, a sufficiently comprehensive lobbying regulation does not exist in most democracies, and where there is one, the presence of legal gaps and regulatory loopholes risks undermining its effectiveness. The United States, Canada and the United Kingdom can be considered as the pioneers of lobbying regulation, thanks to the series of laws and acts implemented in the course of the last century. Still, even the regulatory framework in these countries is often criticized for being too shallow and too susceptible to unchallenged corporate interests. In Europe, the situation is far from perfect, but it is showing signs of improvement.
Only 9 out of 27 Member States have a statutory lobbying regulation (these are Austria, Belgium, France, Ireland, Italy, Lithuania, Netherlands, Poland, Slovenia). These usually consist of mandatory registers for lobbyists and more-or-less rigid transparency requirements and codes of conduct for lobbying activities. Notably, Germany was one of the first countries in the world to introduce restrictions to interest representation. However, its mainly voluntary registration for lobbying in the Bundestag results, to a certain extent, inadequate nowadays. Only time will tell whether the rapid increase in regulatory acts on interest representation passed in the last decades indicates the beginning of a long-awaited reckoning of political institutions to the demands of citizens and lobbying actors alike, or is just a flash in the pan.
Let us now focus our attention on EU institutions, in particular those with executive and legislative powers: the European Commission, the European Parliament, and the Council of the EU. The most relevant legal basis for lobbying at the EU level dates back to the Treaty of Lisbon. In particular, article 11 of the Treaty on European Union explicitly calls on the Commission and the other European institutions to carry out a continuous, open and transparent dialogue with members of the civil society and with association representatives. Article 11, which itself was quite overdue, clearly expresses the idea of participatory and inclusive democracy delineated above, although we have yet to see its concrete realization.
Although pressure and interest groups settled in the halls of European power as early as 1957, the first register and minimal ethical standards for lobbyists active in the European Parliament were introduced in the ‘90s. The subsequent steps to improve the transparency of EU institutions were then collected under the European Transparency Initiative of 2006, which, for the first time, addressed “the need for a more structured framework for the activities of interest representatives”. The Initiative was propaedeutic for the establishment, in 2011, of the Transparency Register, to which lobbyists wanting to operate inside the buildings of the European Parliament and the European Commission would need to subscribe, specifying, among other things, their objectives, their clients and the financial resources at their disposal. Registered parties were also required to accept a general code of conduct. Although a fundamental step forward, the initiative has been heavily criticized because, being registration on a voluntary basis and restricting only physical access to the buildings, it was intended as nothing more than a formal prerogative to enter those spaces, while it hardly prevented undue influence in other contexts. Finally, one of the latest reforms imposed important transparency obligations to members of the European Parliament, obliging them to meet and discuss policy matters only with registered representatives, and to make available on the Parliament’s website the nature and content of these meetings.
Principles and problems of lobbying in the EU
It is clear to everyone that lobbying in the European Union is still not all sunshine and rainbows. Many qualified European NGOs, such as the previously mentioned Transparency International, have been stressing the importance of making interest representation in EU institutions and Member States as adherent as possible to the three principles of a comprehensive lobbying regulatory system: transparency, integrity, and equality of access. In the 2020 report, TI recommends implementing a wide-ranging regulatory framework that could identify both direct (aimed at institutional actors) and indirect (aimed at bureaucrats and non-institutional actors) lobbying, making the Transparency Register mandatory for all lobbying activities, and establishing regular reports on the interactions between lobbyists and decision-makers.
Among the most recognized problems concerning lobbying in EU institutions is the issue of the “revolving door”, which occurs when former Commissioners, MEPs or officials start working in lobbying organizations, often closely related to their previous competence, creating potential issues of conflict of interest. Moreover, just as in any political regime, national and supranational, European policymakers face the risk of giving more importance to corporate interests compared to experts and representatives of civil society; when this happens, the purpose of lobbying is, to a certain extent, defeated. Currently, around half of the organizations currently listed in the Transparency Register represent trade, business and professional interests, which towers over the 8% of think tanks, research and academic institutions. Although these numbers are probably a good sign as far as transparency goes, they are quite alarming in terms of equality of access, and show how unequivocally long the road ahead is.
In my opinion, the public’s ignorance on the subject is one of the most immediate problems. A more widespread awareness on the opportunities and challenges of lobbying would not only increase the pressure on decision-makers at the national and European level to push legislation in the right direction, but would also improve the trust European citizens place in their institutions.