Geopolitics Post-Election: Empowering Government Affairs in China

The geopolitical landscape surrounding China is increasingly complex. Relations between China and the US have been strained, with both sides focusing on careful risk management to avoid a crisis. Tensions between the US and China over global alliances and efforts to reduce Western reliance on Chinese technology and supply chains are further complicated by conflicts in Ukraine and the Middle East. Adding to this uncertainty is the change in the U.S. president, which brings another element of unpredictability. With Donald Trump now confirmed as the next US president, his leadership may heighten geopolitical uncertainty, as his assertive and often unilateral policies toward China risk straining international alliances and amplifying global tensions.

Amid this challenging operating environment, Government Affairs (GA) leaders have a key role to play in driving the success of their organisations in China and beyond.

Empowering teams in shifting times

To be successful in navigating geopolitical challenges, leaders at the Beijing roundtable agreed companies need to take a strategic, proactive approach. This includes a need for empowered teams that have the ability and permission to make informed decisions at pace. This level of empowerment is crucial as it allows for a proactive response to fast-moving geopolitical changes, ensuring the organisation’s first line of defence is robust and capable.

Attendees agreed that fostering a culture of risk-taking and innovation can help organisations stay agile and responsive. This requires regular training and development programmes to build the skills and knowledge to handle complex geopolitical issues.

One Head of Corporate Affairs urged the other leaders to “be bold and start by taking measured risks: Empower your people to make decisions, even if those decisions aren’t right the first time. Adopting a less risk-averse mindset can build resilient, well-equipped teams who feel trusted to do the right thing. When teams aren’t empowered and equipped, the responsibility will fall back on you as the leader.”

Creating structure with working groups and grading systems

Corporations increasingly find themselves managing the balance between US and China operations. More than one MNC Andrews Partnership spoke to is moving its research function out of China, causing disruptions. With foreign direct investments (FDI) in China decreasing, working groups can collaborate to focus on careful management and strategic engagement, including maintaining open lines of communication with government stakeholders. Building long-term trust and relationships can help companies navigate sudden issues and explain their positions effectively.

Two immediately actionable tools that have proven successful for some:

1. Establishing working groups across different regions can help enhance global engagement when dealing with a complex geopolitical landscape. These groups should focus on specific issues, fostering collaboration and ensuring diverse perspectives are considered. This approach can help manage the balance between local and global operations, particularly in sensitive markets like China. By creating dedicated teams to address regional challenges, companies can develop tailored strategies that are more effective in addressing local nuances and complexities.
2. Another important tool is to develop a grading system that can help identify and assess various restrictions in a market, creating a standardised framework in a complex context. These systems can provide a structured way to evaluate geopolitical risks and their potential impact on business operations. By having clear indicators and benchmarks, companies can make more informed decisions and mitigate risks effectively. A grading system can also facilitate better communication with stakeholders, providing them with a clear understanding of the risks and the measures being taken to address them.

The role of internal communication and CEO visibility

With fewer expatriates based in the China offices of MNCs, internal communication with global headquarters becomes even more critical. GA leaders at the roundtable discussed their essential role in bridging the gap, ensuring that those working at headquarters fully understand local developments and vice versa. This task can be challenging but is essential to maintain alignment and understanding. Effective internal communication can help align global strategies with local realities, ensuring the company remains agile and responsive.

Advising the global CEO to visit China — ideally more than once a year — can also significantly improve relations and demonstrate commitment to the market. These visits can help grow understanding of local challenges, build stronger relationships with key stakeholders and showcase a company’s dedication to its operations in China. This level of personal engagement is crucial for navigating the complex geopolitical environment. Regular visits by top executives can reinforce a company’s commitment to China and enhance the broader organisation’s understanding of the local landscape, beyond the narratives presented by global media.

As highlighted in the Andrews Partnership Corporate Affairs Leaders’ Study (below), CEOs are increasingly demonstrating confidence in the Corporate Affairs function. This growing trust positions Corporate Affairs leaders perfectly to advise CEOs on the importance of visiting China more frequently and the impact this can have.

Changing perception and reality

Leaders at the roundtable agreed that changing the global perception of China is a gradual process that requires careful and strategic communication. Consistent and transparent communication can help build trust and foster relationships while breaking down biases and misconceptions. Highlighting success stories through social media and other digital platforms can also help counter negative narratives.

Perceptions can be just as challenging to alter as geopolitical realities and the challenge for GA leaders is to build trust slowly and carefully through well-managed diplomatic relationships.  Their tactics must address both perceptions and impact, as improving one side without the other can be counterproductive. Maintaining a regular dialogue with government officials and other stakeholders can help address concerns and find mutually beneficial solutions.

It’s clear from our roundtable discussion that by combining strategies such as dedicated working groups with empowered teams and a nuanced, long-term perspective on market dynamics, GA leaders are vital to propelling their organisations to sustained success in China.