T H E N AT U R E O F P U B L I C S E C TO R L E A D E R S H I P

Due to the stage of development in the Power Sector

the influence of government on market forces,
competitive advantage and business sustainability is
still significant.
The very nature and structure of government and its
decision making process is political. Hence, political
risk management is an imperative to sustainability of
any business model in the sector.
2013 Workforce Management Centre. All rights reserved.

KEY POLITICAL RISK AREAS

Policy Risk

Regulatory
Risk

Stakeholder
Risk

Legislative
Risk

2013 Workforce Management Centre. All rights reserved.

POLICY RISK
One of the formidable forms of political risk is the Policy Risk. Policy Risks
are comes in several forms:
Policy Somersaults (For example the power reform programme of the
Obasanjo Administration was halted and overturned by the Yaradua
Administration);
Policy Design Failure (When the very premise, assumptions and
principles of the government policy is faulty, It increases the risk of
failure in execution);
Poor Policy Implementation (When sound government policy lacks
strong and sustainable political will for its execution).

2013 Workforce Management Centre. All rights reserved.

R E G U L ATO RY R I S K
Consistent regula=on of
market forces, overlapping
regulatory requirements
and constraining of
business drivers

A state of total breakdown

of Industry law and order

2013 Workforce Management Centre. All rights reserved.

Incompetence and lack of

capacity in the regulators
may lead to misapplica=on
and abuse of industry
rules, regula=ons and
guidelines

Over-
regula=on

Mis-
Regula=on

No
Regula=on

Under-
Regula=on
Regulators implement
weak enforcement and
compliance management
framework. Leading to

S TA K E H O L D E R R I S K
Union Ac=ons and
Unrest

Lack of public
support and buy-in
because the ci=zens
cannot see tangible
government value

2013 Workforce Management Centre. All rights reserved.

Poli=cal and
Personal Interest in
the legisla=ve
oversight process

Labour
Stakeholder
Interests

Parliamentary
Interest

Mass Public
Interests

Poli=cal
Leaders
Interest
Where the interest
of the poli=cal
leaders are not
aligned to the
industry interests

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L E G I S L AT I V E R I S K
Laws that are in conict
with government policy

Laws that are outdated

and behind government
policy
2013 Workforce Management Centre. All rights reserved.

Parliamentary
Oversight that reduce
the eec=veness of
regulators
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CORRUPTION RISK
Corruption Risk
is a reality and
it directly
impacts
business
sustainability
and transaction
failures

TRANSACTION
RISK

SUSTAINABILITY
RISK

CORRUPTION RISK

2013 Workforce Management Centre. All rights reserved.

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H OW TO M A N AG E T H E P O L I T I C A L R I S K
The Risk Assessment Model for Government Influenced Sectors must include:
Determination of the Critical Success Factors for the Business Model
Success;
The Determination of which of these Critical Success Factors are directly
impacted by political risk;
The assessment of the structure and nature of the political risks;
An engagement model that includes political and policy management
(practically all key business leaders in every sector support policy
formulation and implementation as a key factor for sustainability);

2013 Workforce Management Centre. All rights reserved.

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E N G AG E M E N T M O D E L F O R R E D U C I N G P O LT I C A L
R I S K I N BU S I N E S S
DRIVE THE
POLICY
STREAM

Policy Development
Support
Policy Implementa=on
Support

DRIVE THE
STAKEHOLDER
STREAM

DRIVE THE
SECTOR
MINDSHARE

2013 Workforce Management Centre. All rights reserved.

Ac=vely Develop and

Par=cipate in Sector
Stakeholder Interven=ons
that Drive Industry Ac=on
Serve as Pool for Deep
Domain Exper=se for
Poli=cal Leaders

Lead Sector Innova=on

and invite policy and
poli=cal leaders to learn
Leverage Global Best
Prac=ces Knowledge and
drive poli=cal leadership
capacity building

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