Low profile, high impact: How the visibility of political agents shapes corporate political influence

Tony L. He

Strategic Management Journal, 2025, vol. 46, issue 11, 2720-2751

Abstract: Research Summary This study examines how corporate political influence in developed democracies is more likely to occur where visibility is lower, both in terms of the actors involved and of the points of influence in allocation processes. Using novel data on politically exposed persons across 28 European countries (2011–2017), I distinguish between elected and unelected political agents in shaping public procurement outcomes. Unelected agents, particularly aides, advisors, and administrative staff, exert stronger influence than elected politicians, who primarily steer upstream processes that offer political cover in uncompetitive bidding situations. In contrast, unelected agents affect both competitive and uncompetitive cases, underscoring the role of political (in)visibility in public resource allocation. This study deepens our understanding of the heterogeneity of corporate political connections and their impact on public–private exchange. Managerial Summary This study examines how corporate political influence in developed democracies often operates through less visible channels. Using data on politically exposed persons across 28 European countries, I find that connections to unelected officials, such as aides and advisors, exert greater influence on firms' public procurement outcomes than connections to elected politicians. Elected politicians affect uncompetitive awards by possibly shaping the rules and specifications that restrict competition, rather than intervening during more transparent stages when bids are evaluated. In contrast, unelected officials influence a broader range of competitive and uncompetitive procurements, taking advantage of their lower visibility to engage across processes. These findings raise important implications for public oversight and for firms engaging with government.

Date: 2025
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