In my previous articles in PR INDONESIA magazine, I emphasized that public affairs (PA) does not take place in a vacuum. Public affairs takes place amidst economic, social, and political dynamics, influenced by various cultural elements and norms. This time, I want to discuss the practice of public affairs in Germany. A country that has been sovereign for a longer time with more rooted social institutions, so that social, political, and economic aspects there are more prominent.
I took the definition of public affairs from the book Public Affairs-Management von Großunternehmen (Public Affairs Management of Large Companies). The definition is: “Public affairs is a company function that regulates the relationship between the company concerned and its stakeholders including the government, parliament, business and professional associations, trade unions, media, NGOs and the community”.
The two institutions mentioned in the above definition, namely business associations and trade unions, are the main players in the German economy. Business associations, especially the chamber of commerce and industry (Industrie-und Handelskammer/IHK) are not only social institutions, but also official institutions. Its existence has been hundreds of years and has been regulated by law since 1870. All companies are required to become members of the IHK. This legal umbrella has inspired the Indonesian Chamber of Commerce (KADIN) since the 1970s to obtain legal recognition. The struggle of the KADIN Indonesia finally bore fruit through Law No. 1 of 1987 concerning the Chamber of Commerce and Industry.
In Germany, the main function of the chamber of commerce and industry is to represent the business world. Another prominent function is vocational education related to various aspects of the business world, including professional certification. At the national level, the German association of chambers of commerce and industry is under the auspices of an institution called the Deutscher Industrie-und Handelskammertag (DIHK). This institution represents the business world at the national level.
DIHK, IHK, and sectoral business associations are very influential in the business world and the German economy. It is therefore not surprising that in the definition of public affairs in Germany, “government” is mentioned as a stakeholder for the company. On the other hand, trade unions in Germany are no less important, but they are not reinforced by a special law.
Trade unions in Germany are organized by sector, and act as a reflection of the country’s economic structure. The strongest and largest trade union (in terms of number of members) is IG Metall. IG stands for Industriegewerkschaft or industrial sector workers union. The number of IG Metall members is around 2.3 million or 5 percent of all German employees, which are now around 45 million people. This union represents employees in the metal and power industry sector.
Workers, Important “Stakeholders”
The main function of trade unions is to carry out sectoral and periodic negotiations on wages and other working conditions that are not regulated by the law, with the employers’ association. For example, IG Metall manages to champion 35 hours of work a week for its members.
From the above examples, the business structure and economy of the country are operationalized through trade unions and business associations as two equal partners. The very strong role of trade unions does not have a negative impact on the German economy. This country is still proven to be the strongest in Europe and highly competitive around the world. In pandemic conditions, Germany’s foreign trade waned only slightly.
In the understanding of public affairs in Germany, business associations and trade unions become stakeholders that are important to the company, in accordance with its economic structure. So, what is the difference between the meaning of public affairs in Germany and other countries? The difference is which parties are the company’s stakeholders. This is what distinguishes public affairs in one country from another.
Chairman & Chief Consultant, Kiroyan Partners
This article has been published in PR Indonesia magazine 68th Edition, issued on November 2020, page 53.
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