forceforgood Resources - Article - The Football Fans Stewardship Scorecard

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The Football Fans Stewardship Scorecard – Provisional Rankings

Issue(s): Global Financial Crisis , Responsible Investment

Tag(s): Ownership , Premiership , Stewardship

Summary

Tomorrow’s Company ¹ is currently developing a stewardship ² scorecard to apply to all company boards and shareholders. This is in response to the widespread concern that too many companies – including our banks – failed because of an absence of shareholder engagement and risk management by the directors.

As part of this we have developed and applied our own Premiership Stewardship scorecard for clubs currently in the Premiership. We suggest five criteria, equally weighted, which fans are invited to apply to the board and the owners of their company. Our own rankings are tentative and based on available information. We are publishing the rankings at development stage because we want to promote awareness of the importance of stewardship – and promote argument among the fans!

Putting the Club First. Do the board and the owners focus on something more than their own interest? Where are they on the scale between self-interest and putting the club first? Are they altruistic or asset-strippers? Do they give something back to the community around the club?
Long-termism. Is there a youth policy and are promising new players coming through or does the club rely on the transfer market? Have the stadium facilities been improved or are there plans to do more. Is the level of debt prudent? How high are wages as a proportion of total turnover? Does the manager feel his job is under threat after a few poor results? What is their time frame? Do they aim to hand the club on in better shape to the next generation – or are they willing to take any financial risks to buy success now. Is the club’s reputation strong?
Clarity of purpose, role and responsibilities. Have the owners clearly said what their ambitions, intentions and strategy are? Is there unity on the board around this? Or is there uncertainty? Is there a clear understanding about the respective job of the owners, the directors and the manager and coaching staff? Does the owner stay out of the dressing room and let the manager get on with the job? How well does the board work? Are there independent directors who can challenge the strategy?
Engagement with fans and community. Do they recognise and respect and involve the voice of the fans? Do they work well with the local community, planning authorities etc? Is there a fans’ forum? Are fans or the community represented in the ownership of the shares and or the governance of the club? Does the ticket pricing structure enable a wide fan base e.g. are there concessions for students/senior citizens etc?
Passion commitment and conviction. Are the owners and board passionate about the club and their role as stewards working for its future? Do they bring conviction to their role and show commitment in supporting the players and manager? Are they obsessive about doing the right thing in the right way for the club, and football more generally, and do they work to get the Premier League and other clubs to do the same?

We see stewardship as being for the long term, but at the same time owners and boards have to be good at managing what is front of them now. To reflect this these rankings are drawn up on the basis of the performance of the current owners. Where these owners have been in place some time, the assessment reflects the track record of owners and boards over the past five to ten years, as well as the way they are handling current and prospective challenges. Where owners are new, the assessment is limited to the current owners and their performance so far. Where ownership is in transition, the assessment is of both past owners and the current prospects for ownership.

Rank	Club	Marks out of 50
1	Aston Villa	37	Randy Lerner is stable owner with long-term commitment, sensible debt levels, improving the stadium, not over-spending on players.
2	Arsenal	36	As percentage of turnover the lowest wage bill in Premiership! Prudently refusing to enter the transfer merry-go-round. Invested in youth and stadium, and keep faith with their management. Potential bidding war among new shareholders. Older shareholders had until all recently maintained stewardship with “lock-down” agreement. Debt two thirds of Chelsea or Man Utd but aggravated by property slump.
3	Wigan	35	Good stadium (if until recently dodgy pitch). Under Dave Whelan has risen from the bottom to the top tier surviving raids on players or managers. Ranked champions of the Premiership by ING in a 'points for pounds' league that measures the extent to which season ticket holders are given value for money.
4	Everton	32	Continuity and commitment by Bill Kenwright in spite of fans’ money frustrations; long term support for a manager yet to win anything. Stadium ambitions so far thwarted.
5	Blackburn	31	Long stewardship of Jack Walker and his family trust contributes to high score. Second to Wigan in a 'points for pounds' league that measures the extent to which season ticket holders are given value for money. Current Chairman John Williams prudent in warning that relegation would threaten viability with low fan-base.
6	Stoke City	28	Low debt but high ratio of wages to turnover. Engaged fans and legendary atmosphere. Must be glad that they have put Icelandic ownership behind them in 2006. Some worries about being owned by the subsidiary of a betting company business but Chairman Peter Coates seems dedicated to putting the club first.
7	Birmingham City	27	Gold, Sullivan and Brady have held their nerve and finances through more than one relegation – steady stewardship since 1993. But Carson Yeung’s seemingly endless takeover bid and near 30% holding clouds the future and helped drive away Steve Bruce. Plans for a new stadium but a long way off.
8	Hull City	26	Prudent stewardship has steered Hull all the way through the league. Until recently lowest debt in premiership. Man Utd and Chelsea were 600 x more indebted! Adam Pearson has found a new owner in Paul Duffen – too early to judge impact but Pearson says they have finances to invest over 2 – 5 years
9	Burnley	25	Chairman Barry Kilby has been in post ten years and his investment and stewardship has steered Burnley from bottom to top. He allegedly paid £3m for the Burnley Ground when it was valued at £1m! Club was recently commended by Football Suppporters Federation for season ticket policy.
10=	Bolton	24	The Reebok Stadium shows long term thinking. But only safe financially as long as they stay in Premiership, but wages rose 27% last year and turnover only 16% and gates were down 10%. A hard balancing act. Have the highest number of seasons in the top flight without winning the title (the 2008/2009 season, was their 70th in the top flight.)
10=	Sunderland	24	Niall Quinn and Drumaville have shown the desire to put the club first and in Ellis Short would appear to be on the way to an effective handover of stewardship – a tough task. Early days but Short appears to be sensibly detached from the football management side with Niall Quinn having secured a strong new manager.
10=	Wolves	24	Owner Steve Morgan has impressive business track record and Sir Jack Hayward and son managed handover of stewardship in a way that other clubs, especially Portsmouth, would envy. Strong balance sheet and awards for community/family but wages bill high relative to turnover.
13	Man Utd	23	Second highest debt in Premiership, but profitable under the Glazers and beginning to pay down the debt they were landed with. A policy of signing young players; and the longest serving manager of them all in spite of the change in ownership points to a steady rise up the stewardship ranks.
14	Manchester City	22	New owners with big ambitions. Too early to judge whether these will truly mean putting club first and upholding the best traditions of football. But have shown strong support for Mark Hughes when results poor.
15	Chelsea	20	Highest debt in Premiership. Only starting transition from personal bankrolling to sound business footing. Fanatically committed owner has allowed players to by-pass and undermine manager.
16	Fulham	19	Continuity under Al Fayed ownership but insufficient progress on stadium development and future less certain. Criticised for allowing too much of increased revenue going out in players wages which stand at nearly 75% of turnover.
17	Portsmouth	16	Drifting because of ownership uncertainty after period of impressive progress. Size of debts is forcing player sales and jeopardising the sale of the club.
18	Tottenham	16	Until last season sacked successful managers and hired less successful ones; traded players according to age and financial (not football) criteria.
19	Liverpool	13	Big debts. Feuds between owners have unsettled manager who manages in spite of, rather than supported by, the owners. Stadium not sorted out.
20	West Ham	12	Mismanaged transfers; jeopardised long term for short term success; embraced Icelandic owner at worst moment; albeit previously strong youth policy, now club must be run to pay back debt.

Rank	Club	Criteria
		Putting Club First	Long-termism	Clarity of role & purpose	Engagement of fans and community	Passion	Total/50
1	Aston Villa	7	8	8	7	7	37
2	Arsenal	7	9	8	7	5	36
3	Wigan	6	9	8	7	5	35
4	Everton	6	7	6	6	7	32
5	Blackburn	7	6	6	6	6	31
6	Stoke City	2	6	6	8	6	28
7	Birmingham City	4	6	6	5	6	27
8	Hull City	6	6	5	6	3	26
9	Burnley	4	5	4	6	6	25
10=	Bolton	4	4	6	4	6	24
10=	Sunderland	4	5	4	6	5	24
10=	Wolves	4	4	4	6	6	24
13	Man Utd	2	6	7	4	4	23
14	Manchester City	4	6	6	4	2	22
15	Chelsea	5	4	1	3	7	20
16	Fulham	3	4	3	5	4	19
17	Portsmouth	2	2	2	6	4	16
18	Tottenham	4	2	4	4	2	16
19	Liverpool	1	3	2	5	2	13
20	West Ham	3	2	2	4	1	12

1) Tomorrow’s Company

Tomorrow’s Company is a UK-based think-and-do tank (a charity and a limited company) focusing on the role of business the relationship between business and society. It works across the globe with business leaders and other organisations, pushing the boundaries of thinking on issues critical to the future of business, and works with companies as they implement new ideas, learn and pursue sustainable futures. In 2008, Tomorrow’s Company launched www.forceforgood, a website fostering debate about the future of business.

2) Stewardship

Tomorrow’s Company defines stewardship as follows: “Stewardship is handing something on to the next generation in better shape than you inherited it - the active and responsible management of entrusted resources, taking account of the interests of stakeholders now and in the longer term.”

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