20 JUL

2018

2018 FIFA World Cup , Highlighted , SRI , Topics

ESG: which European clubs are in the top division?

While the World Cup is transfixed with VAR (video assistant referee), European football clubs appear to be focusing on three very different letters.

ESG (environmental, social and governance) matters are rapidly becoming mainstream concerns for investors, consumers and even football clubs.

Clubs have adopted ESG policies in recent years to prove their commitment to sustainability within their communities, integrating it within their business strategies.

Here is an overview of some of the best practices.

From the ground up

Barcelona’s Camp Nou will be among the most sustainable structures in world football when it is completed in 2023. Rainwater harvesting, grey water recycling and the use of LED low power lighting, will combine with shading structures to reduce the need for air conditioning within its precincts.

German Bundesliga club, Wolfsburg, is a shining light – LED, naturally – in sustainability. Its electricity comes from green sources, it uses recycled paper, lighting controlled by motion sensors and the local canal is used to water its training ground.

Lighting presents a major cost – and environmental impact – particularly for clubs in northern Europe due to the long nights. Many have moved to energy saving technology. Meanwhile, Ajax is implementing an alternative emergency power supply at its Amsterdam Arena by creating storage unit using almost 300 recycled power cells from Nissan Leaf all-electric vehicles. Linking these units creates considerable energy reserves, while making use of obsolete ‘green technology’.  


Green all over

Seria A’s Juventus, a quarter-finalist in this year’s Champions’ League which has just scored a major coup in the transfer market by buying Cristiano Ronaldo, has an extensive sustainability policy. The club is looking to not only reduce waste, but also encourage fans to use available recycling stations and discourage them from bringing any non-recyclable waste to the grounds… perhaps a step towards hoping that they behave like the Japanese supporters who cleaned-up the stands at the end of their team’s matches at the recent World Cup.

On the topic of recycling, certain causes are both obvious and unanimously supported. The UK Premier League has committed to a two year deadline to eliminate all single-use plastics, Tottenham Hotspur has announced they will be banned from the opening of its new stadium in 2019.

Manchester United arguably has the most advanced environmental policies in the Premier League and holds a fistful of ISO accreditations for environmental management. It uses rainwater for irrigation and has reed beds at its Carrington training centre. Rubber has also received a focus, combining with its sponsors Nike and Apollo Tyres to convert old trainers and more than 2,000 tyres into sports surfaces.

Meanwhile Real Madrid has converted all 11 of its training pitches to a new generation artificial turf that requires no maintenance – and therefore no water or chemicals – and donated its turf to schools and community groups.


Social workers

Progress in the themes of sustainability and responsibility among European clubs is not limited to environmental issues however. A large number of social schemes are also being developed, enabling clubs to widen their sphere of influence and prospecting.

All clubs have local community outreach projects to encourage the playing of sport and healthier lifestyles. Some have established social foundations to further this work, often referred to in the business world as corporate social responsibility (CSR).

Bayern Munich, Bundesliga champions for 14 of the last 20 seasons, simply refer to this as “responsibility”, while Paris St Germain’s foundation articulates three guiding principles: to help young people find their place in society and the world of work; to reach out to children in underprivileged neighbourhoods (major suppliers of latent fledgling talent) and bring comfort to sick children.

Many clubs, including PSG, Real Madrid, Juventus and Manchester United focus on social inclusion. That means giving every individual the same opportunity to benefit from sport, whether they live in a bad neighbourhood or have a disability. Increasingly, these clubs are working hard to encourage female participation in the sport.


Leading by example

Size is no obstacle to demonstrating a commitment to ESG. Forest Green Rovers of League 2 of the English Football League has been dubbed “the greenest football club in the world” by FIFA for its environmental commitment.

It already uses green electricity and has banned both pesticides and meat pies as part of its policies and plans a new stadium that will be made entirely of wood.

Football clubs and multinational companies are fighting the same combat. The fact that the minor-league Forest Green Rovers club has succeeded in developing such an advanced sustainable policy is proof that all clubs can do so. Today, the same applies to a portfolio manager analysing a stock to invest in. Extra-financial indicators are becoming increasingly more important within investment decisions. It is a safe bet to assume that this trend will accelerate over coming years.