A Football Fiasco highlights the Power of Stakeholders in a Crisis
Chelsea supporters after the club announced it was withdrawing from the European Super League © Getty Images
Let’s talk about the little round ball. Why? Well, we’ve just witnessed a spectacular collapse of an ill-fated football proposal thanks to stakeholder capitalism. Its ‘lessons’ go way beyond elite sport.
What we’re witnessing is the new way – a new economy, a ‘stakeholder economy,’ – where, as McKinsey describes it, “Leaders need to respond to the pressures that society now places on large companies to address social issues and not just run a profitable enterprise.”
As Ryan Heath writes in Politico, the spectacular collapse of the European Super League provided not only “a peek into the global business of sport,” but “a lesson in the rise of stakeholder capitalism over shareholder capitalism.”
Before I explore the new rules of the stakeholder economy (not new, BTW, for those of us in the corporate affairs world who can attest to the power of stakeholders; we knew this long before McKinsey popularised the term), let’s remind ourselves of what actually happened.
Eric Betts at Slate says it well when writing a post about the fiasco.
“For less than 60 hours, your international cabal consisting of the biggest soccer brands from England, Spain, and Italy threatened to override the sport’s premier competition, the Champions League, and supplant its central structure of rewarding teams that perform well and punishing those that do poorly.” Fifteen founding clubs -- which included Arsenal, Chelsea, Liverpool, Manchester City, Manchester United, Tottenham Hotspur, AC Milan, Inter Milan, Juventus, Atlético Madrid, Barcelona, and Real Madrid -- would be permanent members of the Super League. (Read more here.)
Fans, the critical stakeholder base, erupted on hearing the news staging protests across the continent, even blocking soccer powerhouse, Chelsea’s team bus. (Chelsea is one of the world's richest, biggest, and most-supported football clubs.)
And even ‘The Firm’ got involved. Despite grieving the passing of Prince Phillip, Duke of Edinburgh, his beloved grandfather, Prince William spoke out. The Duke of Cambridge, who is president of the UK’s Football Association, went public with his concerns amid a fierce backlash against the “big six” English Premier League clubs who threatened to break away.
It must be a very big deal if a British Royal gets involved publicly, and big enough to unite as strange ‘bedfellows’ as UK Prime Minister, Boris Johnson; Keir Starmer, Leader of the UK Labour Party plus Prime Ministers of France and Italy in opposition.
The financial backers, J.P. Morgan copped it too, not surprisingly. A spectacular ‘own goal.’ They later admitted they had ‘clearly misjudged’ how the deal would be viewed.
So, dear readers what does this all mean?
It’s called consultation, stupid!
In the ‘new value agenda’ it’s all about collaboration, consultation and courage. Rather than plot and plan in a small ‘elite’ power bubble – in this case, a tiny bubble of very wealthy, middle-aged men – McKinsey argue, rightly in my opinion, that “the new investment sweet spot is at the intersection of a company’s purpose, value as its economic core, and its culture.”
It’s the culture, stupid!
As I’m oft to quote “culture east strategy for breakfast.” (Source: Peter Drucker.) Culture will trump strategy each and every time, particularly in a crisis.
It’s about governance, good governance. And world soccer has some history in that department, indeed very sordid recent history! So it’s heartening to hear Aleksander Ceferin, the head of UEFA, European football's governing body, calling the super league proposal "a spit in the face for all football lovers and our society."
Bottom line, ignore your fan base at your peril, particularly if it’s heavily millennial-based.
Do what you can to get your stakeholder and issues management plans modernised and sorted before the next crisis hits.
Need some support in planning, then let us assist you. Email us today at janie@janejordan.com.au.
