This is the second part of The Shaker's interview with Australian Chamber of Commerce & Industry CEO, James Pearson. To read Part I, click here.

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Platitudes of the Innovation statement aside, have we fully grasped the impending impact of technology on business and the workforce? 

The market-based answer is that those people who anticipate and understand the changes ahead will survive. Obviously, those that don’t will experience the more powerful effects of creative destruction in the marketplace.

In a broader context, it’s important to remember that we’ve always had disruption, however this disruption is now larger and faster than any time in human history.

Good businesses get it, and most businesses experience it, and they’re all making decisions as to how they need to adapt. It’s good for government to draw attention to his disruption, and to get business to focus on it, however it’s crucial for business to remember that they are constantly innovating.

Not every business is going to make a huge leap in one single day, but businesses constantly evolve their operations within the relevant market. Most advances are organic and iterative, and businesses are very aware of the challenges that surround them.

 

 

How will ACCI assist in managing the huge transition ahead of us

Our position is that government should not make it harder for business to respond to these challenges, but should work to ensure that there are as few barriers as possible to organise their workforce, to manage their teams, to not be forced into a third party (such as a union) unless they want to, and to ensure that business owners are not losing valuable family time in order to maintain their compliance obligations.

 

You must be disappointed that Small Business portfolio is now in the outer ministry.

Of course. However, we’re still working really hard in this space.

What we do need to acknowledge is that under the previous government, some great steps were made – such as the $20,000 instant asset write-off. Initiatives such as this are really important for addressing the concerns of small business.

In the 2013 Election, the Chamber ran a very strong campaign under the slogan Small Business: Too Big to Ignore for a small number of key measures was highly successful. In 2016, we were looking at making all business more competitive, but small business remains at the heart of our advocacy given the presence of the sector among our membership.

We’re going to hold the Prime Minister to his word that small business is vitally important to each portfolio. Small business success, as Mr Turnbull has stated, is a key KPI, and we’re going to hold him to that through the activities of the Chamber.

 

Branding from ACCI's recent campaign

 

The new Minister for Small Business, Michael McCormack, looks like a pair of safe hands – particularly outside of cabinet. Have you had a chance to meet since his appointment?

I’m due to meet him this week. I’m also meeting the shadow business spokesperson, Senator Katy Gallagher, whom I know is a respected Canberran.

This is a great opportunity. They’re the first of the ministry and the shadow cabinet that I’ll be meeting since the election, and it’s important to remind them of the importance of small business as the lifeblood of the economy.

Most businesses are small businesses. The bulk of people are employed by what are called small and medium business and, when you get out into country towns, you’ll find they are the rock that many communities are founded. They’re active in their local chamber, active in the local communities and providing local services.

That importance is largely understood and respected in such towns, but in the cities the perception of business and its role is somewhat different, and that’s something that the Chamber definitely wants to use as a foundation for its advocacy.

We realise that if you make it harder for business, then you make it harder for those communities that right now that are currently telling government at the Federal level that they are unhappy, and there is a role for the Chamber to assist as a key part of our work.

 

Has the inconsistent and piecemeal approach to tax reform meant that the messaging is so fractured that real tax reform in Australia is effectively finished? If so, who’s to blame? If not, where to from here?

It’s not finished, but everything has become a lot harder. The degree of difficulty for real economic reform has gone up as a result of the election – both the slim balance of power in the lower house, and the composition of the Senate. However, we need to respect the will of the people as a result of the election, but recognise that the process has become a lot harder.

There will have to be negotiations, and trade-offs are a part of that process. The government is going to have to work very hard to stitch together some kind of patchwork of policies that it knows it can get through rather than launch an entire suite upon the parliament.

This new political environment will also test the Chamber and similar bodies. We’ll also be challenged in the way we negotiate, our ability to identify compromise that doesn’t sacrifice the main objectives, but will also test our ability of the importance of business, of the private sector… things that for a long time were probably taken for granted.

We need to remind people of the importance of the sector in fuelling the economy and underpinning the way of life that we love in this country.

 

 

Voters didn’t seem to like the idea of banks getting a corporate tax cut as part of the government’s plan to move all businesses onto a rate of 27.5%. Is this borne of a desire to focus on domestic issues rather than a considering Australia’s ability to attract international investment?

I don’t believe the campaign spent nearly enough time focusing on Australia’s place in the world.

Our advocacy is based around improving our intentional competitiveness. We use to be in the top ten - now we’ve slipped to 22^nd place and the trend is in the wrong direction.

The Chamber’s 10-point-plan to improve business competitiveness has been developed through input of our members and we were one of the few bodies actually promoting this discussion leading up to the election.

There can be no doubt that through the Brexit and the emergence of Donald Trump that we are seeing a more isolationist way of thinking. A similar approach would spell serious trouble for Australia because we might be geographically an island.

The wealth we have accumulated over the last century – and particularly in the last decade – is inextricably tied up with being an open economy that promotes free trade.

The modern Australian economy is built completely on the inflow of foreign capital and foreign talent. This has led to a modern economy which is one of the most diverse and genuinely open accepting communities on earth. This is lost in the current debate, and it will be put in danger should we also pursue protectionist policies.

 

Finally, a bit of future-casting: Will the Femantle Dockers ever win an AFL premiership?

Well, I’m sorry to say that the best chance was in 2013.

The president of the Dockers was on my board at the Chamber of Commerce & Industry of Western Australia, and it was a very sombre meeting in October after we played our last Grand Final.

What made it worse was the number of Eagles fans that also sat on that board.

Being a Dockers supporter means that you don’t just celebrate winning a game - you celebrate winning a quarter! So, yes… we will win a premiership, and I’m sure it will be sooner rather than later.