Crisis-hit clubs "must cut out financial risks"
Fri December 12, 2003 01:09 PM ET
http://www.reuters.co.uk/newsPackageArticle.jhtml?type=sportsNews&storyID=42
1433§ion=news
LONDON (Reuters) - Soccer clubs are continuing to take financial risks and
need to improve their business management to ensure survival, a report says.
The State of the Game 2003, published by the Football Governance Research
Centre at London's Birkbeck University, said changes should be implemented
to avoid the sort of problems that have hit clubs such as struggling Leeds
United.
"What we need is for clubs to undertake proper risk assessment and financial
planning and to pursue partnership with their supporters and local
communities in order to avoid these crisis situations from emerging in the
first place," said Gordon Taylor, chief executive of the Professional
Footballers' Association in the report preface.
Leeds have run up debts of 80 million pounds after investing heavily in a
squad that failed to produce success on the pitch. The premier league club
revealed annual losses of almost 50 million pounds.
Leeds, in danger of relegation, are in takeover talks and have warned they
may have to call in administrators.
The report said clubs would benefit from a "code of corporate governance" --
a guide to the better running of their businesses.
"Good corporate governance is essential if clubs are to be managed
effectively and to survive in the difficult economic circumstances
surrounding the football industry," it said.
Christine Oughton, a professor of management and a co-author, said: "The
establishment of a best practice code, tailored specifically to the football
industry, would help improve their governance structures and procedures,
which would in turn help their corporate performance."
Leeds are not alone. Despite a substantial rise in turnover, only a fifth of
Football League clubs and just over a quarter of premier league clubs made
profits in the 2001/2002 season, according to consultants Deloitte and
Touche.
In the past 11 years 34 clubs have become insolvent but none has yet gone
under, thanks to the backing of supporters.
© Reuters 2003.
-----Original Message-----
From: Ramón Pueyo [mailto:
ramon@ecodes.org]
Dear Charles,
The Reuters link you posted takes you to a blank page (even copying and
pasting the second line. Could you please post the text of the article?
Thanks for the great job!
Best wishes,
Ramón
)---------- Original Message ----------------------------------
From: Charles Wankel <
cxx@bellatlantic.net>
Reply-To:
cxx@bellatlantic.net
Date: Sat, 13 Dec 2003 03:53:19 -0500
>Management assignment of the day: Develop a code of corporate governance
>for a soccer club.
>
>You might assign as related reading:
<http://www.reuters.co.uk/newsPackageArticle.jhtml?type=sportsNews&storyID=4
21433§ion=news>
>
>And even more so:
>http://www.football-research.org/research.htm
>
>[If the above hyperlink is broken you should paste the end of it back on in
>your browser's url window to have it load properly.]
>
>Cybercollegially,
>Charles Wankel
>Mg-Ed-Dv List Director
>