Government and good business

The Makati Business Club (MBC) released last Monday the results of its Executive Outlook Survey on the performance of 62 government agencies under the Aquino administration. Of the 62, 43 received positive net satisfaction scores, indicating that more MBC members were satisfied with the performance of these agencies in the past year than those who were not. The survey has been conducted by MBC since 1993 among its members, who simply tick “satisfied” or “not satisfied” for each of the agencies in the list.

There was much media coverage of the results, particularly of the top 10 agencies and those that suffered the biggest drops in their net satisfaction rankings. There are two other survey results that would be good to highlight. The first is that six agencies appearing for the first time in the survey debuted with impressive net satisfaction rankings: Department of Science and Technology-Pagasa, No. 4; Office of the Presidential Adviser on the Peace Process, 7; Philippine Statistics Authority, 10; PhilHealth, 12; Pag-Ibig Fund, 15; and Social Security System, 15. The second is that from 2010 to 2014, the number of agencies getting positive net satisfaction ratings has been increasing.

In 2010, the final year of the Arroyo administration, only 20 percent or 9 out of 45 agencies got positive ratings. In 2011, under a new administration, the number jumped to 55.6 percent or 25 out of 45. In 2012 it increased to 67.9 percent, and this year it reached an all-time high of 69.4 percent or 43 out of 62. It seems that more government

offices are gaining the confidence of the captains of industry, further bolstering the Aquino administration’s other positive indicators on governance, performance and competitiveness.

A number of agencies have been contacting MBC since the results were released, to seek more information on the survey and the specifics on their net satisfaction rankings. A basic minimum goal of each agency is to maintain a net positive satisfaction ranking and, to this end, keeping business leaders informed is key. To improve its rankings, it would be good for an agency to engage business leaders in a dialogue at least once a year. The private sector often initiates this, but there is no reason the head of an agency shouldn’t make the initial approach. Last March 25, MBC assisted in gathering the heads of various business groups including the foreign chambers to a roundtable with PhilHealth president Alex Padilla. PhilHealth initiated this—and look where it is in the survey results.

For the agencies’ information, there are various avenues for engaging the private sector. One very effective forum is the Philippine Business Groups-Joint Foreign Chambers (PBG-JFC) that was first convened to prepare a joint letter to the President before his 2013 State of the Nation Address. This year, the PBG-JFC again wrote a letter to the President, and it intends to follow through on its recommendations by engaging the agencies directly. Its recommendations cover the areas of integrity and good governance, inclusive growth, infrastructure development, energy security, foreign investments, and smuggling.

What’s interesting to note is that agencies that have not done well in the MBC survey will most likely be targets for dialogue, based on the letter to the President: the Senate and the House for legislative-agenda items, the Department of Agriculture for inclusive growth, the Department of Transportation and Communications for infrastructure development, the Bureau of Customs for smuggling, and the Department of Energy for energy security.

The National Competitiveness Council (NCC) is another good avenue for engagement with the private sector. Various working groups invite government agencies to take part in the regular meetings. To maximize the engagement and the time contributed by business leaders to these meetings, it would be best for agencies to designate an official representative, preferably an undersecretary or a director. Another effective venue is the AmCham-led Arangkada effort that monitors over 100 reform measures aimed at making the Philippines move twice as fast toward global competitiveness. MBC works actively with the PBG-JFC, NCC and Arangkada apart from conducting its own roundtables and forums with the government.

Yet another meaningful venue for engagement between the government and the private sector is the Integrity Initiative, which complements perfectly the ongoing Open Governance Partnership program. Integrity Initiative has come a long way since its launch in 2009. Starting with the signing of an integrity pledge and adopting a unified code of conduct for business, companies become part of the movement to build a culture of integrity and to level the playing field for business. Integrity Initiative has set up a self-assessment and validation system and will soon launch its certification system as well as a whistle-blower mechanism to ensure that ethical standards and controls become ingrained in more companies.

Aside from its agencies adopting their version of an integrity pledge, the government must help Integrity Initiative make ethical standards and good behavior a competitive advantage in doing business in the Philippines. Thus, we have been pushing for an executive order that would provide the framework for agencies to reward and recognize, rather than punish, as a good business practice.

The Department of Budget and Management, one of the biggest losers in the MBC survey, can help make this EO a reality as it concerns the government doing business with the private sector.

Peter Angelo V. Perfecto is executive director of the Makati Business Club.