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Survival of the fittest – if you’re not at the table, you’re on the menu

Feature-Nexus- -APAC-Group-Chair-Nick-Campbell-The-Australian-Business-Executive

It was Charles Darwin that said ‘It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.’ 

Today, as business and government address the COVID-19 crisis, Darwin’s ‘survival of the fittest’ idea is just as relevant now in 2020 as it was when first published in On the Origins of Species in 1869. 

COVID-19 has triggered a rapidly evolving political and economic environment where governments have been forced to make quick decisions and roll-out large-scale policy and big spending programs without the chance for widespread consultation with either business or the community.

While some are still in a state of shock, other businesses are moving fast to find “a seat at the table” of government policy, having their voice heard and contributing to government decision making. 

First course: a dynamic and changing environment

The Federal Government under Prime Minister Scott Morrison has moved quickly in terms of the immediate health response – closing borders, reducing people-to-people contact and rapidly building a National Medical Stockpile – and by global comparison, it’s safe to say the Federal Government has done well on this front.

With the immediate health threat receding for the time being, the next big challenge for the Federal Government will be navigating the economic minefield. 

The conversation has shifted to assessing the economic damage of COVID-19 and time will tell whether governments have responded quickly and adequately enough to protect jobs, businesses and livelihoods. 

In response to the economic crisis, the Morrison Government announced a range of economic stimulus measures totalling more than $319 billion. This includes both the JobKeeper and JobSeeker packages, together with other rebates and economic stimulus measures. 

What the crisis has precipitated is a move towards big government and big spending to mitigate the economic fallout.

On key issues, the Government has nationalised its response and swapped its fiscally-responsible decision-making approach with an urgent spending and interventionalist approach – the size and scale we have not seen since the Second World War.

The COVID-environment has also triggered a shift on how government decisions are being made. 

The formation of a National Cabinet has condensed government decision-making into the hands of a few, bringing together the leaders of each Australian State and Territory Government.  

National Cabinet has seen some consensus on a wide variety of issues, and business needs to be aware that when thinking about engagement with this new body, it needs both levels, adding more complexity.

Additionally, in response the Federal Government has set up various industry taskforces, including the National COVID-19 Coordination Commission (NCCC), with the aim of engaging directly with the business community. The question now is, what is the outlook ahead following the immediate actions from government?

Second course: preparing for the fiscal outlook ahead

Business and politics are inextricably linked, and the fate of the Morrison Government will be dependent on the success of business – particularly small business – kickstarting the national economic recovery and revival.

Even before the COVID-19 crisis, there was already talk of an economic downturn, with questions increasing about the end of Australia’s record economic run and whether enough economic reform had been done in the ‘good times’ to ensure productivity and growth in the ‘tough times’.

However, few commentators would have predicted the scale of the disruption amidst a global pandemic. 

While the Morrison Government went into the 2019 Federal Election promising a return to surplus, these plans have since been abandoned and the Government has delayed the delivery of the May 2020 Budget – now set to be brought down on 6 October 2020. 

The October Budget will see the Government do away its plans to deliver an economic surplus and instead be focused on spending and national building projects to kick-start the economy. 

General consensus is that if key policy reform asks of business are not packaged and presented to government in time for the October 2020 Budget, then the likelihood of support over the coming years will largely diminish.

With this uncertain economic outlook and significant toll taken by key economic drivers, it is imperative that business positions itself with government to avoid the risk of being left out of the important reforms to come.

Main course: opportunity through change

There is now the impetus for reform and there is now potential to re-evaluate the role of government, current policies and our system as a whole. 

History has shown that it has taken either a Royal Commission, Recession  or a Global Financial Crisis (and now a pandemic) to instigate substantial and rapid reform. 

Recent strides of economic reform came under the Hawke/Keating Government’s in response to global and domestic economic downturns. Followed by a reforming Howard Government in the long-term interest of the nation.

To need to rebound out of the economic downturn gives rise to a potential overhauling of issues such as red and green tape, issues of duplication, approval processes and access to efficient government services. 

Additionally, it now presents an opportunity for the Morrison Government to look again at the relationship between each level of government and assess whether it is currently fit-for-purpose and adequately serving the needs of the Australian public.

While there is currently a shift towards big spending and big government, this change will be temporary. Soon there will be a return back to smaller government, with the private sector to run the economy based on principles of free enterprise together with appropriate   government regulations and safety nets. Businesses will need to position themselves now to shape this transition by developing relations within government on their own and through industry bodies.

Additionally, this is a perfect opportunity where there is a national purpose to act. In typical fashion, Australians will see this crisis as an opportunity to shape our future for the better. 

So far, we have seen a national response and an unprecedented cooperation from all levels of Government, led by the Prime Minister Scott Morrison. But now is a time for a national approach to the fixing of the economy – a ‘new bargain’, a ‘new deal’. 

Dessert: what does business need to do in the current landscape? 

Just like Federal and State Governments have adapted quickly on the immediate health response, businesses will need to be at the table with Government during the formulation of economic responses that will have repercussions on every sector of the Australian economy. 

With the current political and economic instability in Australia, what should businesses be looking to do in the immediate COVID-environment to mitigate their political and policy risks?

  1. Increase intelligence gathering: business needs to closely monitor what both state and federal governments are doing, especially with reforms and budget changes. Tracking potential changes are crucial to being able to engage before decisions are made that have widespread consequences on industry sectors. As this environment is showing, governments at all levels are making decisions in a short time frame; early warning and detection systems are critical. 
  2. Increase understanding and perspective through education: despite the uncertainty, business should strengthen their direct engagement with the politicians and their advisers, especially around important areas of interest and concern. Educating key political leaders on business and the impacts of policy change is the best way to protect policy stability for business.
  3. Engagement with regulators, the Australian Public Service and newly established COVID-19 Taskforces and Commissions: in order to further mitigate the risk of political changes, companies should spend time with regulators and key members of the bureaucracy who can inform political leadership. In times of crisis and a distracted  political leadership, the bureaucracy plays an even more important role.  Especially in areas where there is limited consultation with business, the public service can advise elected decision makers of some of the implications and downstream effects of policy change.
  4. Adapt to change – quickly: Finally, and probably most importantly, what is needed internally within businesses is a change in mindset, increased resourcing, and senior leadership focus to ensure success.  To many companies, government is one of their most important shapers of their business environment. They need to be treated as such.  While companies can rely some practical steps through industry associations, chambers of commerce, forward thinking companies also need direct advocacy and engagement on key policy areas or issues.

While government policy and decisions won’t be able to cater for everyone and every industry, having a voice at the table of government will boost the chance of business to be involved and not left behind.

As we’re reminded by Darwin, it will be ‘survival of the fittest – and those businesses who can adapt to change will survive and thrive and get a seat at the table.  If not, they’ll be on the menu.

Nick Campbell is the Chair of the Nexus APAC Group. He has worked across the private sector and government on Strategy and Public Affairs,


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