Mutual, fan ownership in football

23 April 2021 | News

The European Super League was the inevitable result of government inaction on football club ownership

The debacle of the European Super League once again brings to the fore the troubled question of football club ownership.

Established as community groups over a century ago, many professional football clubs have morphed into big businesses that are now focused entirely on revenue and profit opportunities.

The handwringing from English football authorities over the proposed breakaway was a bit late in the day. It should be no surprise to them that the corporatisation of football would lead to this.  The warning signs have been there for years, with landmark issues from the public listing of football clubs through to the purchasing by oligarchs and hedge fund investors.

These are people who are interested in finding an investment rather than supporting the sporting endeavours of a club for its own sake.  Their ownership of a football club is not just foreign based on their nationality, but on their personal objectives for the club.

It is a financial transaction pure and simple, as evidenced by their desire to do away with the jeopardy of competition. This is incompatible with football ownership and should rule them out as unfit to be proprietors of clubs.

The problem is deeper than the super league participants, however. The arrogance of football owners ignoring the interest of the clubs’ fans has long been a problem. Even as consumer businesses, they have failed to nurture and support long-term relationships with their customers. With a few exceptions, clubs are subject to a merry-go-round of fortune, depending on how benign the current owner is.

It is significant that no German club participated in this circus. Bundesliga rules insist on 51% supporter ownership of their clubs. They do not and never will exist as vehicles for investment, because they are rooted in their communities.

It’s over 20 years since we set up Supporters Direct in the UK and progress is glacial. We have some fan owned clubs and board representation, but it has been hard fought on an individual basis. This is because real reform has not happened either from football authorities or government. Leaving it to the fans can only go so far if the odds are stacked against them.

The UK government is now reviewing this again. Maybe change will happen but that means facing down the big money.  Real reform is regulation of how clubs can be treated as investment commodities and fan control as exists in Germany. 

In 2014 the All-Party Parliamentary Group for Mutuals made many of these points to the Football League, the Premier League, UEFA and the government. It said that the prevailing attitude on ownership was problematic then and it is now proving to be disastrous.

It made a number of recommendations, none of which have been acted upon. Had they, we would not be in this situation today. Its recommendations were:

  • Football authorities should undertake a joint study of football club ownership in other countries, including for example the Bundesliga, in order to understand the effect that different ownership structures have on the corporate behaviour of football clubs.
  • Football authorities should adopt a policy of promoting supporter involvement and ownership in football clubs as a strategy for building trust and confidence for the long term.
  • The Football industry should pay for the work of Supporters Direct (now within the Football Supporters Association) on the basis of a fixed percentage levy on transfer fees. This could also cover other community activities and remove the self-interested discretion from the decision-making processes.  
  • FA and League rules should be altered to protect the legacy assets of football clubs. (club colours, club name, home ground ownership and the rights to securitise assets).   If this does not happen, Government should legislate to include such protections and to extend the right to bid for community assets to a right to buy for supporter groups.
  • The Government should consider legislating for the changes it wishes to see in the ownership and governance of the football industry. ( protect minority supporter stakes in the case of a compulsory purchase order).

It is important to drive home the issue of supporter ownership to protect and maintain the fundamental purpose of a football club. Which is, for the avoidance of doubt, to play football- competitively- for the entertainment of supporters.

None of these issues are new and for years, Government has treated the football authorities with kid gloves by ignoring serious proposals for giving fans a say in their clubs. Inaction has consequences.  This time, there can be no excuses.

Peter Hunt from Mutuo
Peter Hunt is Managing Partner at Mutuo