exam prep Flashcards
(2 cards)
Outline lobbying - assess if you believe it is an ethical practice.
intro
- definition
- examples of involved individuals
- types of lobbying
- real world lobbying context
- 2 pros
- 2 cons
conclusion
Lobbying Lobbying is the act of influencing decision makers, legislators and government officials to support or oppose specific laws, policies and regulations
Exampls of Individuals or groups who participate are:
Corporations, large businesses lobby for tax and regulation changes
Trade associations, lobby for policies that benefit their respective sectors
Activists, lobby in the form of protests for environmental, social or human rights benefits.
Lobbying can be direct - a face to face approach involving meetings or formal submissions/ requests.
Or lobbying can be indirect - aiming to influence public opinions through social media campaigns or protests which externally places pressure on decision makers.
Lobbying is widely accepted as a feature of democracy. In the US lobbyists register underneath the lobbying disclosure act, and in the UK attempts at lobbying are publicly recorded in a legally overseen register.
These rules are implemented to ensure lobbying is ethical and transparent, something that would otherwise be compromised by larger and more powerful parties.
One advantage/ benefit of lobbying is democratic involvement of unrepresented groups. NGO’s and social advocacy groups e.g mental health charities and environmental protesters, use indirect lobbying to bring awareness to respective social and environmental issues pusing for policy changes that benefit the groups needs in the form of funding or regulation adjustmments allowing these causes to be represent more effectively. When ethically practiced it helps endorse these groups creating a more inclusive democracy.
Another advantage of lobbying is It allow organisations to represent their interests. Lobbying acts as an essential tool for organisations to convey their interests directly to decision and policy makers. The regulatory environment is complex and decision makers will not always be fully aware of every businesses concerns and situational realities. Thus lobbying allows policy makers to be aware of more factors creating more optimal regulatory decison making. By lobbying businesses can ensure their concerns and perspectives are considered leading to fairer and mode balance decision making
One disadvantage of lobbying is regulatory capture.
Regulatory capuutr occurs when powerful corporation use tier influence to control the regulators resulting in policies favouring corporate interests at the expense of fairness and public good. For example a banking powerhouse like jpmorgan could lobby for relaxed banking regulations. If they gained regulatory capture here it could undermine consumer protection. If this happened trust in the government will fall as democratic accountability and fairness comes into question.
Another disadvantage of lobbying is unequal influence access. Lobbying favours organisations with large financial resources, this creates a mismatch in who can influence policy making. Large multinational corporation who can afford professional lobbyists will more effectively represent their interests whereas smaller organisations ngos and charities may lack this representation of their interests. This will lead to an imbalance in the direction of public policy and a failure of policy to reflect the interest of all stakeholders.
To conclude lobbying is a complicated and controversial practice. On one hand it prommotes democratic engagement allowing underrepresented stakeholders to be represented and allowing policy makers to be more effectively informed. However it is at risk of regulatory capture and unequal access often becoming a tool used by large wealthy corporations to pursue individual interests as opposed to broader social good. Its impact is thus dependent on the laws and ethical standards surrounding it making a balanced approach necessary to ensure lobbyin serves public interest and not individual agendas
How do national government actions affect JP morgan
Regulations and compliance
The government regulate fi’s to promote financial stability as jp morgan are a multinational corporation with operations in over 100 countries they are impacted by national regulation and compliance requirements. From january the 1st the eu introduced mandatory extensive sustainability disclosure requirements. This will impact jp morgans reporting and operational practices.
Monetary policy and interest rates
Central banks aim to stabalise the economy by setting and changing interest rates. This will affect JP morgans investing decisions and loan profitability. For example in April 2025 following trumps announcements of sweeping tariffs, the US federal reserves delayed interest rate cuts due to inflationary pressures from the global recession that trump has threatened to put the economy into. This will impact JP morgans investment strategies due to the accompanied economic uncertainty and unpredictability.
Taxation Policy
Changes in corporate tax impacts JP morgans profits directly, governments may also offer incentives of reduced tax for FDI. Certain countries may have lower rates of corporate tax and encourage JP morgan to increase operations in that respective country and thus Taxation policy if one way that national governments impact JP morgan
Public Policy
Government spending - expansionary fiscal policy has the ability to change economic conditions and thus affect JP morgans performance. Investment into public infrastructure may also involve JP morgans services and thus be an opportunity for JP morgan
Political risk
Government instability or changing administration can create weconommic uncertainty, bring about policy and tax changes and create or reduce risk for JP morgan in respective markets. Emerging markets are also more likely to be susceptible to political instability which leads to uncertain market conditions and can inhibit JP morgans profits. For example in 2022 during the russia vs ukrain war around 440 million of JP morgans assets were seized by russia as they tried to exit the russian market. Showing how political instability affects JP morgan
Conclusion - In conclusion JP morgan, being a multinational corporation with operation in over 100 countries are comprehensively impacted by national government decision making. They must carefully navigate a wide and varying range of tax rules, regulatory policies, interest rates, public poloicy changes and political issues. However it is neccesary for JP morgan to embrace these challenges to competitively thrive whilst maintaining compliance to continue to grow and perform as they have in the past.
