EU leadership changes prompting firms to brace for impact
Major shakeups loom in European Parliamentary leadership amid planned further deal deliberations. President of the European Union Jean-Claude Juncker is nearing the final run of a five-year term; and President of The European Central Bank Italian Mario Draghi will soon end an 8-year term.
For many companies of the EU, political and economic uncertainty will lead to tighter restrictions in the ways they are used to operating. Membership elections, held every five years, could have far reaching effects on trade, data protection laws, and important elements of the business market such as mergers and acquisitions.
Executive analysts from government affairs recruiting firm Korn Ferry are preparing for the upcoming shift. Principle Dan Sullivan sees growth in corporate government-affairs teams along with a resulting increase in lobbying power. The changing political environment acts as a buffer for companies to reinvest resources in expanding government-relations teams according to Korn Ferry senior-level client partner Sigrid Marz, who is a leading voice in the coming EU makeover. Other Korn Ferry executives including Nels Olson have written on the topic.
For parties publicly and privately, Brexit delivery can be described as the proverbial elephant in the room. A backstop for lawmakers means more time for consensus, but for giant companies with high exposure to European markets like Siemens and Alston, lack of a deal leaves the corporations in possible anti-trust limbo. Additionally, the implications for a wide-spread policy of corporate scrutiny could affect other firms with sizable positions in the economy.
The EU and the UK remain in negotiation talks. Prime Minister Theresa May has vowed to deliver Brexit on time. She will meet with president of the European Commission Jean-Claude Juncker despite calls against reopening withdrawal agreement.
As a result, the Bank of England is holding interest steady. The subsequent growth forecast has been slashed 0.7%, which is the lowest recorded going back a decade.