The recent elections on July 23 led to a dispersion of the vote and neither one of the two main parties -Partido Popular (PP) and Partido Socialista Obrero Español (PSOE)- obtained a sufficient majority to form a Government. Spain is a parliamentary system in which the support of at least 176 members of Congress is necessary to constitute a Government.

The center-right PP, which was the winner of the elections with 137 seats in Parliament, already has the support of the far-right party Vox, but it is still far from the 176 necessary to get the green light from Congress.

The Socialist Party (PSOE), which was second with 121 seats, has the support of the far-left Sumar and also appears to have the support of pro-independence parties in Catalonia and the Basque Country. However, to reach the magic number of 176 he will need the support of Puigdemont, who lives in self-exile in Belgium and whom Spanish judges are demanding for crimes against the Constitution and for corruption.

As an essential condition for giving his support to a new government led by socialist Pedro Sánchez, Puigdemont has demanded an amnesty from which both he and hundreds of other people prosecuted for the events of October 1 can benefit. Several experts have warned that such an amnesty would clearly violate the Spanish Constitution. Even former leaders of the PSOE have said that this amnesty would represent an attack against Spanish democracy.

It is not yet known whether Pedro Sánchez will accept Puigdemont’s conditions to continue as President of the Government, although several of his ministers who in the past rejected the amnesty because they considered it unfair and illegal, have now begun to admit that possibility. In the past, Sánchez pardoned other leaders of the 2017 independence uprising, but Puigdemont was excluded because, having fled the country, he has not even been tried.

La entrada In the hands of the independentists se publicó primero en Estudio de Comunicación.

This uncertainty coincides with the period in which Spain holds the rotating presidency of the European Union, which runs from July 1st to the last day of December.

The polls predict a victory for the conservative Popular Party (PP), but with an insufficient number of seats in Parliament to be able to form a Government alone. The most feasible alliance would be with the far-right Vox party, but the negotiation could be long and complicated, since the leader of the PP, Alberto Núñez Feijóo, has assured that he will not renounce the essential principles of his political program in exchange for being prime minister.

With regard to the party that is now the majority in the Government, the Spanish Socialist Workers’ Party (PSOE), no survey gives it as the favorite for victory on the 23rd, although the possibility of forming a Government in a coalition with all the parties at his left, as well as with other nationalist and regionalist parties, is not ruled out.

A coalition of this nature would entail a risk of political instability, since the PSOE would probably have fewer seats in Parliament than it currently has and would be forced to join very different political forces with interests and programs that sometimes clash with those of the PSOE.

Nor would it be easy to build a pact on the right either. Even if the PP were the party with the most votes, it would have to get the support to govern from a party like Vox that repeats the populist and anti-immigration speech that other far-right parties have been delivering in different European countries in recent years.

Therefore, Spain may find itself in a political blockade as of July 23rd that could even last several months. Only an unlikely victory for the PP by an absolute majority would guarantee the rapid formation of a new Government.

Article by Antonio Caño, partner at estudio de Comunicación

La entrada RISK OF POLITICAL BLOCKADE se publicó primero en Estudio de Comunicación.

At the same time, this electoral advance supposes the almost total paralysis of the functions of the central Administration, which will be limited to dispatching ordinary affairs during the next six weeks, as well as representing a obstacle for the performance of the rotating presidency of the European Union, which corresponds to occupy Spain as of July 1.

The early calling of elections has been forced by the defeat of the parties that make up the majority of the Government in the municipal and regional elections held on May 28. Both the Socialist Party (PSOE) and the far left party Podemos suffered severe losses in those elections, giving considerable ground to their opponents in the conservative Popular Party, Partido Popular (PP).

Sánchez interpreted this defeat as a vote of punishment for his government’s policy and decided to advance the general elections so that the Spanish voters decide as soon as possible if they maintain confidence in the parties of the current government coalition or prefer that power pass into the hands of the right.

The announcement of this new electoral campaign has further polarized Spanish politics. The Socialist Party warns of the risk that a victory for the Popular Party would entail for the social model that it claims to defend. PP, center right, might have to rely on the far right party Vox in order to achieve a majority in Parliament. The Popular Party, for its part, insists on the need to put an end to what it calls “el sanchismo”, which it defines as a very radical style of government that has led the country to division and confrontation. The leader of the PP, Alberto Núñez Feijóo, has explained that his intention is to obtain a majority that allows him to govern without Vox.

Meanwhile, the far left is waging a bitter infighting among its leaders, likely to see them divided into July elections with little chance of a good result.

Although PSOE and PP are presented to the voters as radically opposed options, the truth is that the arrival of the conservatives in the Government would not mean a substantial change in the country’s political or economic model, although it is foreseeable, in the event of a victory for the conservatives, an economic policy that places greater emphasis on controlling the deficit and public debt, as well as a brake on tax increases.

The polls so far predict a relatively comfortable victory for the PP. That does not guarantee, however, a majority to immediately form a government. Negotiations to form an Executive can be long and difficult. On the other hand, we must count on the recovery capacity of Pedro Sánchez, who has already shown signs of recovering in circumstances of extreme adversity in the past.

By Antonio Caño, Partner at Estudio de Comunicación

La entrada Early elections se publicó primero en Estudio de Comunicación.

Those directly responsible for teams have a decisive impact on the commitment (desire) that employees experience with their organisation, as well as the quality and quantity of their performance (doing and doing better every day). This is a statement that is widely shared for us not to spend more time justifying it.

The flattening of structures, often linked to the increasing automation of tasks, transformed the role of “middle management” many years ago: in the structure, fewer levels above and below; at work, less direct supervision of employees’ actions and more management tasks or feeding and reviewing data into systems. This has led to more cost-efficient organisations and more autonomous staff in carrying out the work. However, alongside these positive results, new challenges are appearing, which call for new solutions.

We quote a conclusion drawn from a McKinsey study: “Companies treat middle managers as a catch-all, requiring them to spend much of their time handling non-managerial work and navigating organisational bureaucracy rather than allowing them to focus on the most important role in an organisation: nurturing talent”.

Yes, nurturing talent where once the priority was the supervision of the workforce.

MANUFACTURING SECTOR

We focus this reflection on the industrial environment, where the complexity implicit in this transformation is very clearly perceived, although similar reflections can be made in administrative or technical environments.

Automation has eliminated many operational tasks, reducing the number of people dedicated to them and transforming their work, which is increasingly focused on the supervision of mechanised processes. Today’s operators – to a large extent – no longer perform physical work at a position on the production line, but sit at control stations or walk around the plant ensuring its smooth operation. In many industrial sites, work clothes are no longer stained by grease from machines, dust from the processing of raw materials or sweat from physical exertion. The new operators bring, above all, knowledge of the process and attention in their supervision. Knowledge and attention… two qualities inherent to intellectual work, now also demanded of those who were previously manual operators.

Knowledge and attention that require encouragement and recognition. Stimulus and recognition of a very different nature to that of the previous operative positions, but equally – if not more – necessary. Stimulus and recognition that cannot be achieved without specific directive action by their direct managers, those “middle managers” whose work many believed would disappear with the automation of physical work.

A person dedicated to providing knowledge and close supervision of the installation for which he or she is responsible has very specific communication needs. They need to know the reason for the processes and the keys to product differentiation, they need to know the upstream and downstream phases of the overall production process and, above all, they need to feel heard so that their knowledge has an impact on the organisation.

Knowing the meaning of the task and the context of the responsibility being carried out; feeling heard and relevant in the decisions of the environment in which they work. Both requirements require close and willing managers who dedicate time to dialogue and sharing with their collaborators -both individually and as a team-. Managers who are aware that they manage “talent” and not “direct labour”.

In our experience, it is necessary to incorporate communication with the teams as a specific responsibility of middle managers, specifying the activities that are required for it, freeing up the necessary time for its implementation and providing the necessary training and content so that this conversation can flow with utility for both (manager and team) and, therefore, for the organisation.

In the past, an authoritarian manager could achieve an efficient production line. Today, we have all realised that shouting at the person supervising a robot is as ineffective as shouting at the robot itself. Not only ineffective, but clearly counterproductive.

Communication with teams can no longer be a variable of each manager’s personal style – something that some managers do because they like it and others do not; communication as an activity of free choice – or something to be done when other obligations allow it – communication as a marginal activity. Communication with teams is one of the keys to achieving their commitment, which is necessary to achieve differential contributions and performance.

Because automation is not just about replacing people with machines.

By Pablo Gonzalo, partner at Estudio de Comunicación

La entrada Middle managers, critical to foster engagement and performance se publicó primero en Estudio de Comunicación.

Although most polls predict a victory for the conservative Popular Party throughout Spain as a whole -which could be significant for the national elections at the end of the year-, the most important thing is to know which parties or coalitions will end up governing in each of the 12 autonomous communities and more than 8,000 municipalities that vote on May 28th.

Autonomous communities are very important in Spain, a country with an almost federal government model. Autonomous communities have their own Parlaments and a great capacity to make their own decisions in matters of health, education, taxes and other important areas for the economy. Their role is therefore very relevant for business development.

There are no elections in what are called “historical communities” (Catalonia, Basque Country, Andalusia and Galicia), but there are in others with enormous weight on the Spanish economy, such as Madrid, the Balearic Islands and the Valencian Community.

With the exception of Madrid, where the Popular Party has a great advantage in the polls, in all other major communities the result is difficult to anticipate. We are, therefore, in a period of uncertainty and waiting, which, in the case of Spain, is justified both by global circumstances and by the national political situation.

La entrada WAITING TIME se publicó primero en Estudio de Comunicación.

One of the uncertainties that the May elections should help to clear up is that of which will be the dominant parties on the left and what are their chances for that block to have a sufficient majority to govern.

The current Government coalition in Spain is made up of the Partido Socialista Obrero Español  (PSOE) and Unidas Podemos, a group further to its left. However, in recent months internal divisions have arisen within Unidas Podemos and, at this time, it is not clear who will be the candidates to the left of the PSOE.

On Sunday, April 2, Vice President Yolanda Díaz, until now a member of Unidas Podemos, announced her intention to be a candidate for the presidency of the Government at the head of a new party called Sumar. At the same time, the former vice president and former leader of Podemos, Pablo Iglesias, is reluctant to support Díaz and seems willing to present a different candidate.

The division of the forces to the left of the PSOE into two different candidacies would make it more difficult for them to obtain deputies in Parliament and, therefore, would make the repetition of a left-wing coalition Government more unlikely. It is extremely difficult for the PSOE to obtain a sufficient majority to govern on its own.

Therefore, May elections will serve to verify who is stronger on the far left, who is the real boss of that block: Yolanda Díaz or Pablo Iglesias. After that, maybe, just maybe, one of the two will agree to relinquish power.

By Antonio Caño, associate at Estudio de Comunicación

La entrada The division of the left se publicó primero en Estudio de Comunicación.

On the economic side, the month of February closed with the announcement of a 6.1% rise in year-on-year inflation. After another previous increase in the month of January, the increase in prices has become a fundamental problem for the Spanish economy. The Government, which had lowered the tax on some foods to alleviate this situation, had anticipated that inflation would begin to fall this year.

Added to this data was the announcement that one of the main Spanish multinationals, Ferrovial, has decided to move its headquarters to the Netherlands. Although the company will maintain its activity in Spain and will continue to be listed on the Spanish Stock Market, this measure has a negative symbolic value for the Government since it calls into question its business friendly policy.

In the political sphere, a case of corruption to which a MP from the main government party, the Socialist Party, appears linked, weakens the image of a Government that had made the fight against corruption a fundamental flag of its political action. Besides this, the serious errors in the application of a crucial law, known in Spanish as “Sólo sí es sí”, has turned part of women and the feminist movement against the Government.

As a consequence of all this, the main opposition party, the center-right Popular Party, has increased its lead in the polls. The popularity of the leader of the Popular Party, Alberto Núñez Feijóo, already surpasses that of the Prime Minister, Pedro Sánchez.

La entrada A difficult start of the year se publicó primero en Estudio de Comunicación.

But, in addition to the market itself that demands transparency in these matters, since 2018, the law on non-financial information and diversity sets the rules for two types of companies: 

• those with more than 500 workers. 
• those which qualify as public-interest entities under audit legislation or which, for two consecutive financial years, meet at least two of the following conditions: 
  • more than 250 employees 
  • those for which the total assets are more than EUR 20 million. 
  • those where the net annual turnover exceeds 40,000,000 

To comply with the law, these companies, among other things, must report on the development, results, and situation of the group, stating in their report: 

• A brief description of the business model and the policies developed (with the results of the year) 
• Risks linked to the company’s activities 
• Non-financial key performance indicators (standards for non-financial key indicators that are generally applicable and that comply with the European Commission’s guidelines on non-financial key performance indicators and the Global Reporting Initiative standards will be used) 

And the impact of its activity regarding: 

• environmental issues (circular economy and waste management, greenhouse gas emissions, water consumption, air pollution, etc.) 
• social concerns (measures to facilitate the enjoyment of reconciliation, training, accessibility for people with disabilities, equality, safety at work, etc.) 
• respect for human rights and the fight against corruption and bribery (instruments available to the company to deal with these situations) 
• information about the company in which it operates (commitments to sustainable development, subcontracting and suppliers, tax information. . .) 

Although a proposal has recently been put on the table to introduce new reporting standards at the European level, companies should therefore keep an eye out for new updates in this area. 

María Luisa Guerrero, Senior Consultant for Estudio de Comunicación 

@malu_guerrero 

La entrada Non-financial reports; do they really benefit all companies?  se publicó primero en Estudio de Comunicación.

• “Bookings in some destinations in the Balearic or Canary Islands are higher than before the pandemic.” 
• “In 2021, 3,180 million euros were invested in the Spanish hotel sector.” 
• “The sector has fully recovered the employment it had in 2019 and we are on track to recover tourism GDP in 2022.” 
• “Spain currently has more luxury hotels than Italy or France” 
• “Sustainability has become an active element of competitiveness, with more than €1.858 million of European funds dedicated to transforming the tourism model towards the sustainability of its destinations.” 
• “Spain is not going to allow excess tourism and we need to carry out a change of model.” 

Madrid, 15 June 2022.- The Secretary of State for Tourism, Fernando Valdés Verelst, spoke today at the Dialogue of the Spain Investors Day: “Predictions and challenges for the future of the tourism sector” and stressed that “tourism in Spain has had the capacity to withstand the two worst years of its history, achieving in turn, the consolidation of the profitability model and to increase the added value of the supply.”  

“Now – he pointed out – we are on a particularly interesting path in terms of the increase in tourism spending, since the average spending per traveller has increased from 987 euros to 1,131 euros”. The Secretary offered other interesting data such as that air capacities between June and August are around 94% compared to 2019 and that the level of reservations currently hovers around 80%. “A forecast”, he said, “that may be exceeded by last-minute reservations, but that will depend on demand in the face of the rise in prices.” He noted as the most popular destinations Ibiza, Palma de Mallorca and some destinations in the Canary Islands “with reservations that are already above the pre-pandemic.” 

Fernando Valdés Verelst stressed that Spain remains a particularly interesting country for investors and highlighted that 2021 was the third year in history with the largest investment in the hotel sector, with 3.18 billion euros in operations. The Secretary of State has made it important that the investment funds – especially the institutional ones – are beginning to incorporate hotel experts who recommend us and who are doing us a lot of good.” 

Fernando Valdés also said that “what confirms the consolidation of this increasingly robust model are the operations carried out in the hotel sector in 2021, which had items diversified to 50% between holiday and urban tourism.” He also pointed out that “Premium tourism has increased significantly, to the point that “Spain currently has more luxury hotels than Italy or France.” All this highlights the diversification of Spanish tourism, which is a sign of identity and leadership, and which has already fully recovered employment since 2019, and is on track to recover tourism GDP by 2022.” 

To this end, he said, “the government has launched investments such as the 500 million earmarked for the conservation of cultural heritage” and is also betting, along with the model of sun and beach, on nature tourism, after that between 2016 and 2019 the number of tourists who choose Spain, whose main motivation is to visit its natural areas, has grown by 14% and its spending by 81%.” Very important, said the Secretary of State, is the investment they are making in digitization: 400 million euros to improve the business models of tourism companies and equip them with tools such as big data, positioning on social networks and cybersecurity. He also referred to the EUR 53 million intended for the training of workers in the sector and the EUR 220 million of European funds allocated for energy efficiency. Along these lines, he wanted to make it clear that “sustainability has become an active element of competitiveness, with more than €1.858 million of European funds dedicated to transforming the tourism model towards sustainability.” And he said: “Spain wants to have a portfolio of sustainable destinations that give us a clear leadership.” 

The Secretary of State for Tourism concluded the event “Dialogue of Spain Investors Day” by assuring that “Spain will not allow excess tourism” and explained that a change of model is needed. As an example, he referred to Magaluf (Mallorca), where the government has destined 4 million euros of European funds with the aim of supporting the destination to find alternatives to the “offerings of excesses” of this city, recovering the coastline and its habitability, all in agreement with the local government. 

La entrada “Spain is a particularly interesting country to invest in tourism” se publicó primero en Estudio de Comunicación.

• “We have the plans and means for an expansive, strong and lasting recovery of the economy.”
• “In addition to investments, we have structural reforms such as the new Climate Change Act and the modernization of the vocational training system.”
• “Thirty billion euros have already been authorised from European funds and there will be a continuous flow of calls, so companies need to be vigilant.”

Madrid, 8 June 2022.- The Secretary of State for Economy and Enterprise Support of the Ministry of Economic Affairs and Digital Transformation, Gonzalo García Andrés, spoke today at the Dialogue of Spain Investors Day: “The Government’s Economic Policy: Forecasts and Plans in a Complex Situation.” Gonzalo García Andrés stressed that “during the last year the Spanish economy has grown intensely and recovered. He also highlights the good performance of employment, which translates into an increase of more than half a million workers contributing to the Social Security since before the pandemic and adding a total of 20.3 million members today.”

The Secretary of State also referred  to the influence of geopolitical circumstances such as the war between Russia and Ukraine, which has led to a rise in the price of oil and a fivefold increase in gas; “an energy shock”, he said, “similar to that of the 1970s, which has led to a significant increase in electricity, and therefore has had an impact on business and is the main cause of inflation, that  we expect to moderate in the second half of 2002 and more intensively in 2023.”

Gonzalo García Andrés insisted that in the government “we have the plans and the means to make this stage the beginning of an expansive, solid and lasting recovery of the economy and, to that end, we have the Stability Program that we sent last March to Brussels, which aims to achieve growth of more than 4 percent this year and continue to create jobs.”

The dialogue was moderated by Benito Berceruelo, President of the SID and CEO of Estudio de Comunicación, who explained that “the aim of the SID is to become a showcase for the Spanish economy and a platform for bringing our country’s business news to international investors” and referred to the Recovery, Transformation and Resilience Plan that outlines the roadmap for the modernization of the Spanish economy. the Spanish economy.  The Secretary of State explained that “19 billion euros have already been invested and we are waiting for the approval of another 12.00 million euros; in addition to the investments, we have structural reforms of the Spanish economy such as the new Climate Change Law and others such as the modernization of the vocational training system.”

Regarding business expectations on the arrival of the European Funds to the real economy, the Secretary of State emphasized that “more than 17,000 projects and more than 12.00 companies have already received support from the Funds” and that Spain is an advantageous country in the management of European aid. “The number of companies and projects receiving funding is clearly going to grow. Since the implementation of the Plan began, less than a year ago, €30 billion has been authorised and there will be a continuous flow of calls, so companies must be vigilant.”

La entrada “Our goal is to grow by more than 4% this year and continue to create jobs se publicó primero en Estudio de Comunicación.