Big news in the football world as Manchester United (“an exempted company with limited liability incorporated under the Companies Law (as amended) of the Cayman Islands) is up for sale.
The total valuation of the club could be north of £4 Billion.
Any new owner will find a club requiring somewhere around 15% of that figure again to invest in infrastructure on the stadium, more on playing staff and a fair amount of time and heartache in reviewing and restructuring an organisation whose sole focus has been on commercial success in order to service the debt the current owners used to acquire the club in 2005.
The years since offer an insightful case study in sustainable and responsible investment. For me, a sustainable investment approach works in the long terms for all stakeholders. You leave the business in a better state than how you found it.
There isn’t much debate on which stakeholders have taken precedence the last 17 years and I expect that will be feature heavily in negotiations with any interested parties. United will remain a hugely attractive target for the right party – a global commercial powerhouse with few peers. Supporters, staff and other stakeholders will now take a keener interest in how that cash is to be deployed in future.
Football remains big business, Billion pound TV rights deals abound. It also happens to be a business like no others. The Demand is insatiable. I remember learning about Demand curves in school – elastic and inelastic and how they respond to price changes. 📈
The example of inelastic demand was cigarettes, regardless of price it sits stubbornly upright – not fully vertical but something like the Albert Clock. Smokers can tolerate a lot of tax. That’s how football is. The “price” is literal (what you’ll pay for TV subscriptions) but also increasingly around your personal values and conscience.
How much can you stomach? The financial aspect is more easily measurable: I’m sure the powers that be are all over that one. The values – sustainability, ethics, inclusivity, social impact are more difficult to assess. This is really being put to the test if you consider where the world cup is being staged as I write this.
There are plenty of signs for hope among the noise and it’s important to avoid cynicism. The value systems of society are changing and that is feeding in to big business, the brands you know and use on a daily basis understand we’re increasingly concerned about social responsibility and being sustainable. That’s no-longer in the nice to have column and empty insubstantial gestures won’t do the trick – sportswashing and greenwashing are widely understood processes by now.
Can anyone recover our soul at MUFC? I hope so. If not, please switch the lights off on your way out. 😰