Business regulation: understanding business' perceptions ...

BUSINESS REGULATION

Understanding business' perceptions and behaviour

BEIS Research Paper Number 2019/024

October 2019

Acknowledgements The authors of this report are John Higton and Rachael Archer of CFE Research, and Professor Tim Vorley of the Sheffield University Management School. We would like to thank all of those involved from the Better Regulation Executive (BRE) for their support in the study. Especial thanks is extended the Gertrud Malmersjo, Principal Social Researcher for the BRE.

? Crown copyright 2019 This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit .uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives..uk. Where we have identified any third-party copyright information you will need to obtain permission from the copyright holders concerned. Any enquiries regarding this publication should be sent to us at: enquiries@.uk

Contents

Executive summary _________________________________________________________ 6 Context _________________________________________________________________ 6 Method _______________________________________________________________ 6 Business' perceptions of whether and how regulation is burdensome _______________ 6 Time taken ____________________________________________________________ 7 Costs associated with administration ________________________________________ 7 Why some businesses do not perceive burden_________________________________ 7 The positive impacts of regulation on business activity___________________________ 8 Economic _____________________________________________________________ 8 Social ________________________________________________________________ 8 Administrative __________________________________________________________ 8 The regulatory constraints on business operations and growth ______________________ 8 How government can communicate with businesses to influence these perceptions and behaviours ____________________________________________________________ 9 Behavioural considerations ________________________________________________ 9 Potential avenues for communication based on behavioural principles ______________ 9

Introduction and methodological summary_______________________________________ 11 Context ________________________________________________________________ 11 Aims and objectives ______________________________________________________ 12 Methodology ____________________________________________________________ 12 Report structure _________________________________________________________ 13

Business' understanding and perceptions of regulations ____________________________ 14 Understanding of business regulations________________________________________ 14 Regulated Activities ______________________________________________________ 15 Defining the burden of regulation ____________________________________________ 17 A note on "innovative" businesses _________________________________________ 18 Time spent on administration _______________________________________________ 19 Business lifecycle ______________________________________________________ 19 Exporting_____________________________________________________________ 20 Identifying and understanding the relevant regulations __________________________ 20 Completion of regulatory forms and processes ________________________________ 21 The impact of regulatory change___________________________________________ 23 The influence of cost on perceptions of burden _________________________________ 24 Decisions regarding external support _______________________________________ 24

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Intermediaries as educators ______________________________________________ 26 Businesses that do not perceive regulation as a burden __________________________ 26 How regulations affect business activities _______________________________________ 28 The rationale of regulatory compliance________________________________________ 28

Economic rationales ? those affecting market decisions_________________________ 28 Social rationales ? protecting the public and customers _________________________ 29 Administrative rationales ? collecting data for monitoring ________________________ 30 Regulations as a constraint on business operations and growth ____________________ 32 Undermining business strategy____________________________________________ 32 Behavioural analysis _______________________________________________________ 35 Mapping evidence to the behavioural model ___________________________________ 36 Education | Psychological capability ________________________________________ 36 Education | Reflective motivation __________________________________________ 36 Persuasion | Automatic motivation _________________________________________ 37 Persuasion | Reflective motivation _________________________________________ 37 Incentivisation | Automatic motivation _______________________________________ 38 Incentivisation | Reflective motivation _______________________________________ 38 Coercion | Automatic motivation ___________________________________________ 38 Coercion | Reflective motivation ___________________________________________ 39 Modelling | Automatic motivation __________________________________________ 39 Tailoring communication approaches _________________________________________ 40 Use of gov.uk _________________________________________________________ 40 Alternative sources of information __________________________________________ 40 Examples of effective communication _______________________________________ 41 Considerations for communications __________________________________________ 42 Potential adaptations to communication approaches ___________________________ 43 Annex A: Detailed Methodology _______________________________________________ 44 Aims and objectives ______________________________________________________ 44 Structure for the behavioural elements of the study ______________________________ 44 Primary fieldwork ________________________________________________________ 47 Sampling _____________________________________________________________ 47 Interviewee screener questionnaire ________________________________________ 48 Interview recruitment____________________________________________________ 48 Discussion guides ______________________________________________________ 49 Fieldwork_____________________________________________________________ 49 Analysis _______________________________________________________________ 50

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Transcription and coding_________________________________________________ 50 Qualitative analysis _____________________________________________________ 51 Annex B: COM-B model for communication interventions ___________________________ 52

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