ESG and Sustainability in sports
Image: mathias-jensen
Environmental, Social and Governance (ESG) sustainability is becoming an increasing priority for the sports industry to address. With stakeholder preferences shifting towards businesses operating more sustainably and fans demanding the same, sports clubs and organisations are required to be ambitious, impactful, and long-term in their approach to sustainability. This presents many challenges for clubs and organisations as sustainability is still an emerging topic for the sports sector, despite its increased esteem.
There are many sports that have begun to develop sustainability strategies whilst others have been established with sustainability as a core element of their identity. For example, UEFA launched its “Strength Through Unity” Sustainability Strategy which outlines its sustainability ambitions and roadmap for 2030. Alongside this, in March 2024, they also launched a free carbon calculator tool for football clubs, cementing their commitment to improving sustainability within the sport.
Formula E, however, was born with environmental sustainability embedded into its structure. It is heartening to see the increasing number of initiatives being established, but there are still many sports that don’t yet have sustainability strategies and a significant amount of progress required for those that do.
When considering a transition towards operating sustainably, organisations should establish a sustainability strategy to highlight their ambitions and describe how they will achieve them. Strategies usually include an understanding of their current sustainability profile, listing the various targets and ambitions that they have, and a roadmap detailing exactly what they need to do to achieve these targets. Once developed, the strategy should become a core part of the business model as businesses must integrate sustainability across all of its operations.
As an example, Formula 1 has developed a sustainability strategy that aims to achieve a net-zero carbon footprint “From Factory to Flag” by 2030. Their approach looks at off-track activities, such as factories and the supply chain, as well as on track developments, such as the creation and use of sustainable fuels. Such strategies must consider any affiliated organisations, meaning the emissions from Formula 1 teams would impact the emissions of the organisation.
Image: Francesco-liotti
Sustainability strategies must encompass more than just environmental ambitions; social and governance-related topics are also incredibly important. The wide-ranging demographics of sports fans and the communities that it engages mean that sports teams and organisations must consider the impact that they have on them. For context, motorsport has a large female fanbase but in previous years had minimal levels of female representation. In recent times however, we have since seen a greater push for female inclusion within the workforce of motorsport teams, more female reporters and commentators during broadcasted races. Female drivers are also being promoted in various forms of motorsport including the publicised all-female F1 Academy series.
The need for well-established governance is critical for the growth of sports. Teams are also businesses and must follow the same fundamental practices for economic and societal purposes. Commitment to human and labour rights, as well as adherence to the relevant legal and financial legislation, ensures that the organisation treats its employees and suppliers fairly whilst remaining financially stable in the long-term. Both the social and governance-related elements of sustainability must be incorporated into a sustainability strategy for it to have the desired environmental, societal and economic impact.
The benefits of successfully integrating a sustainability strategy into a sports team or organisation are numerous. According to a study from 2021 by The Sports Playbook, over two thirds of fans between 16 and 24 years old feel that sport should do more to help the community, improve inequality or act sustainably. Appealing to the changing preferences of fans is essential to upholding brand reputation, supporter loyalty and the profitability of the team. As the number of fans engaging with sports increases, so does the need for action and an impactful transition towards sustainable operation. With most sports proactively integrating sustainability, those who are not, face being left behind by their peers and missing the opportunities that sustainability could bring reputationally and financially.
While it is important to have a dedicated in-house team to maintain a sustainability strategy, common practice is to seek the advice of organisations that have experience in creating holistic strategies. Using an external sustainability consultant is a cost-effective and efficient way to do this. At Enovation Consulting we have experience providing strategies for a variety of clients from motorsport to football.
Our team are experienced in sustainability and change management. We guide businesses on a journey to embed sustainability holistically using detailed quantitative impact assessments helping you to achieve sustainability and business goals.