Key themes from our PwC Non-Executive Director Lunch panel discussion
On Wednesday 29 November and Friday 1 December, we held expert panel discussions with members of our NED community. The panels explored the 'The Economic and Business Implications of the New Coalition Government'.
As Aotearoa New Zealand welcomes it's first three party coalition, our panel of experts shared their perspectives and kōrero on the potential effects the new government will have in various key sectors across the economy. Gordon MacLeod and Simon Botherway - highly experienced Board Directors, Griere Cox - PwC Partner, Mike Shirley - PwC Director and Tom Lawson - PwC Executive Director, explored and identified a number of key themes:
- Scale of uncertainty
- Changing “language” and sentiment
- Industry bodies will become increasingly important
- Apply a wider mid-term lens to government relationships
- Change versus Transformation or Innovation
- Action and Decision versus Review First
Scale of uncertainty
In a world filled with unprecedented uncertainty, both globally and locally, business leaders face the challenge of adapting to a constantly evolving landscape. The new coalition government brings an additional dimension to this complex environment. It makes planning difficult, both at a Government and an individual business level. With strong-minded coalition partners, one concern is what will happen when there is sudden instability between the different factions or the unexpected occurs for which there has been no prior agreement.
This raises the question on what it will take, and how, for Boards and business leaders to support and align themselves with changing pathways and initiatives.
Changing “language” and sentiment
There is already a communication shift emerging within the new coalition government, both in language and sentiment, which is driving a more direct and commercial tone. However, although the three coalition partners are currently presenting similar messages, the way that it is expressed is different. This communication style is an early indication of their business orientation that brings a positive undertone for Boards and business leaders.
Industry bodies will become increasingly important
As the number of parties in government has increased, so has the complexity for business leaders to connect with them and build a dialogue. In this matrix environment, organisations will find it more challenging to build direct relationships with key individuals in government, which will elevate the role of industry bodies and their importance. They are likely to become the most effective approach to drive a joined-up conversation on commercial topics.
Apply a wider mid-term lens to government relationships
There is a chance for businesses to establish relationships and build trust with a potential future more left-leaning government rather than waiting for the next election. Considering the possibility of a back-and-forth dynamic (a game of “ping-pong”) between political parties for the next 10 - 15 years, it is essential for business leaders to be adaptable, fair and comfortable with engaging and building relationships with all sides of the political divide.
Change versus Transformation or Innovation
The focus of this new coalition government, at present, appears to be on reducing, rather than adding new items to the “To-do” list. The change is not about creating new initiatives, but narrowing down the focus on the few. This could be driven by their stated approach on “getting stuff done”. The key emphasis of change is captured in the words “repeal, remove, scupper, and scrap.” By applying a focused commitment on less initiatives, there is a better chance of the chosen priorities being delivered. How much help and government assurance will business leaders need to have confidence to get behind changing policies?
Action and Decision versus Review First
Prime Minister Christopher Luxon's philosophy, evident from his time as CEO with AirNZ, emphasises a proactive and agile approach of "Act Fast. Fail Fast. Move on.” It shows a preference for action and decisions rather than a prolonged review process, which is good for business. This modus operandi is likely to shape Luxon’s approach during his term and the ability to make quicker decisions that will drive delivery.
A common thread that underpins these key themes is a business oriented mindset and approach to governing. These early signs are encouraging for the business community, but it will be interesting to see how this plays out over the new governments tenure.
A huge thanks to our three panellists for sharing their expertise. If you would like to subscribe to join future NED events, please click here.
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