Chapter 2The regulatory challenge: defining lobbying and lobbyists
2.1Effective regulations rely on consistent and clearly defined terms to be applied and enforced successfully.
2.2The terms 'lobbying' and 'lobbyist' have long been inconsistently defined across both legislation and academic literature, with experts pointing out that 'the word lobbying has seldom been used the same way twice by those studying the topic'.
2.3Broadly speaking, many of the definitional approaches taken by governments to date assert the categorical primacy of the term 'lobbying' (the act) over the term 'lobbyist' (the professional actor). It has been argued that this approach fails to discern the distinction between public-interest and private-interest lobbying which could create space for professional lobbyists promoting private interests to operate under the guise of civic participation.
2.4This definitional dilemma has persisted in Australia since the Department of the Special Minister of the State was first tasked with developing Australia's regulatory approach to lobbyists in 1983, with officials acknowledging that 'the recurrent stumbling block is the problem of defining who is a lobbyist'.
2.5Recognising the importance of definition, this chapter considers the respective merits and limitations of using the terms 'lobbying' and 'lobbyist'. The chapter concludes by finding that using the term 'lobbyist' within the regulations could broaden the catchment of lobbyists without necessarily impeding other forms of civic participation, including advocacy and activism, that fall under the broader umbrella-term of 'lobbying'.
Defining lobbying
2.6As noted in Chapter 1, the term 'lobbying' is generally understood to refer to communication with a public official with the objective of influencing legislative, policy or administrative decisions.[4]
2.7Public officials can include a range of actors across the executive, legislative, administrative and judicial levels of government. This includes:
ministers;
parliamentarians;
senior public servants;
judges;
public prosecutors;
decision-makers within public corporations, wholly or partially state-owned enterprises and public-private partnerships; and
decision-makers responsible for delivering public contracts.
2.8However, in both Commonwealth and state and territory parliaments, crossbench members can hold the balance of power and may wield that power to persuade governments to pursue (or refrain from) certain courses of action. Therefore, it is not just decision-makers themselves but also all parliamentarians who may be subject to the influence of lobbyists.
2.9In this regard, The Australia Institute submitted that while 'Government' is used in the Code to mean the executive government, The Australia Institute 'would consider efforts to influence the Opposition and legislators on the crossbench to fall under the category of lobbying too'.
2.10Contemporary lobbying practices encompass a broad and combined range of activities and tactics, including:
direct lobbying, where an interested party transparently advocates for its own preferred outcome through the use of in-house lobbyists;
the use of specialised lobbying firms, or 'third-party' lobbyists to advocate on behalf of an interested party;
collective lobbying through unions, peak bodies, industry associations and trade associations;
media lobbying, including media appearances, sponsored journalism, advertising and social media campaigning to shape public discourse;
exerting influence over public discourse through the use of academics, consultants, think tanks, experts or others to produce research or evidence to support a preferred outcome;
'astroturf campaigning', where a private interest covertly or discreetly funds an organisation presenting as a grassroots civic organisation to advocate for its own preferred outcome;
political donations, gifting, bribing and bestowing honours or cachet in exchange for influence; and
professional mobility between the political, public, and private sectors, also known as the 'revolving door' phenomenon.
2.11Major events, crises, technological developments, increasing globalisation and ever changing social, economic, and political conditions domestically and globally have also been shown to drive developments in lobbying tactics that have outpaced regulations by incentivising private interests to lobby government officials 'behind closed doors'.
2.12At the public hearing the committee heard evidence from Dr Christina Watts on covert 'astroturfing' tactics of the tobacco lobby in Australia, which has filtered funds to lobbyists through several different sources to avoid public scrutiny.
2.13This is one very clear example of a private interest seeking to advance their own commercial interests over the public interest. Evidence suggests that tobacco companies covertly promote regulatory settings that allow them to continue to profit from the sale of tobacco products, despite it being well-known that those products cause harm to people by increasing their risk of various poor health outcomes.
2.14As Dr Jennifer Lacy-Nichols noted, similar examples are readily available relating to the lobbying tactics of other industries, including fossil fuels, alcohol, and gambling.
2.15The evolution of these covert lobbying tactics signals a need to clearly discern lobbying from other forms of civic participation, including advocacy, activism, unionism, research, whistleblowing, and protest, which can fall under the broader umbrella-term of 'lobbying'. This has proven difficult, even for experts.
2.16Dictionary definitions of these terms provide useful clues as to the subtle differences in their meaning and use.
2.17Importantly, definitions of 'advocacy' and 'activism' suggest that they necessarily occur in the public domain. By contrast, the definition of 'lobbying' centres on an 'intent to influence', without specifying whether it occurs publicly or privately.
2.18This is telling. At the public hearing Associate Professor Yee-Fui Ng advised the committee that the current Register captures an incomplete picture by only reflecting third-party lobbyists, which are estimated to represent around 20 per cent of the entire lobbyist population.
2.19In both her testimony and submission, Professor Ng directed the committee to her research on the extent and nature of lobbying in Australia, which estimates that around 80 per cent of lobbying occurs in private, 'hidden in the shadows'.
2.20The New South Wales Independent Commission Against Corruption (NSW ICAC) submitted that unregulated, 'off the record' lobbying creates opportunities for private interests to exert undue influence over official decision-making, diminishes trust in government and increases the risk of corruption.
2.21The lack of specificity around the definition of lobbying, combined with the categorical primacy of the term 'lobbying' (the act) over the term 'lobbyist' (the professional actor), produces a definition of lobbyists that is broad and amorphous.
2.22This in turn risks creating vague regulations that could potentially unduly impede on forms of civic participation which are not privately or commercially motivated, while also producing regulatory settings in which 'what is unknown about commercial lobbying is far greater than what is known'.
Defining lobbyists: third-party lobbyists and in-house lobbyists
2.23The field of lobbying has become increasingly professionalised in recent decades and the wielding of political influence has become more complex as a result. At the public hearing, Professor Ng advised the committee that the last 40 years has seen lobbying in Australia and internationally dramatically transform from a small industry of a few hundred people into a multibillion-dollar industry.[20]
2.24There are two main categories of professional lobbyists: third-party lobbyists and in-house lobbyists.
2.25Third-party lobbyists are generally understood to be paid professionals engaged to communicate with and influence public officials on behalf of their clients. These lobbyists are often employed by lobbying firms, or operate as sole traders, and self-identify as lobbyists.
2.26In-house lobbyists are generally understood to be professionals seeking to communicate with and influence public officials on behalf of their immediate employer. This category of lobbyists is less easily identified as they are often employed in executive, company director or government relations roles that potentially obscure the realities of their professional duties to lobby public officials.
2.27Further obscuring the role of in-house lobbyists, many of these professionals assume a wide range of professional duties, not all of which relate to lobbying public officials.For example, Chief Executive Officers, company directors and other senior executives of large organisations are likely to have primary responsibilities for the overall direction and leadership of the organisation, making major corporate decisions, serving as the public face of the organisation, managing the budget, and overseeing the work of employees. In many instances, these responsibilities will exist alongside their responsibility to lobby public officials.
2.28In her submission Professor Ng drew the attention of the committee to the regulatory model in the United States (US), which defines lobbyists based on spending 20 per cent or more of their time engaging in lobbying activities. In effect, this model captures all professionals that engage in levels of lobbying above the specified threshold regardless of their job title or formal employment arrangements.
2.29Under Australia's current regulatory framework, set out in the following chapter, only third-party lobbyists, estimated to represent less than 20 per cent of lobbying activity, are captured.
2.30Therefore, reversing the categorical primacy of the term 'lobbying' over 'lobbyist' would acknowledge that, while all lobbyists lobby, not all those who lobby are necessarily lobbyists.