Corporate Social Responsibility and Sports Sponsorship

Corporate Social Responsibility And Sports Sponsorship

Steve Hemsley

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THE AUTHOR

Steve Hemsley has worked as a marketing journalist for more than 15 years. He has written extensively for Marketing Week, The Financial Times and The Guardian among many other publications on marketing and sponsorship issues. He is also a former sports editor at Kent Messenger Group Newspapers.

ACKNOWLEDGEMENTS

The publishers would like to thank the following companies, organisations and individuals for their assistance in producing this report.

Business Respect, Sustainable Marketing, RTM Sports Marketing, Nottingham Trent University, Boston College for Corporate Citizenship, The European Sponsorship Association, St James Ethics Centre (Sydney), Sponsorship Consulting Ltd, Business In The Community, Ardi Kolah, Department of Culture Media and Sport, Four Sports Arts & Sponsorship, Brand Reputation, The Sports Marketing Network, The Ethical Corporation Institute.

In particular, we would like to thank John Luff and Mallen Baker for their guidance and for submitting introductions to the report.

TABLE OF CONTENTS

EXECUTIVE SUMMARY:...... 8 CSR In Business ...... 8 CSR And Sport ...... 8 Cynicism Towards CSR ...... 9

INTRODUCTION ONE WHY CSR SHOULD NOT BE A DISTRACTION IF YOU ARE SERIOUS ABOUT MARKETING ...... 11

INTRODUCTION TWO THE CHANGING FACE OF CORPORATE SOCIAL RESPONSIBILITY AND SPORTS MARKETING ...... 16

SECTION ONE WHY SPONSORS NEED A CSR STRATEGY LINKED TO SPORT .. 19 CSR’s Impact On Brand Awareness And Sales ...... 21 The Influence Of Business And Sport In The Local Community ...... 23 The Olympic Games ...... 26 Case Study: Corus And British Triathlon Federation ...... 28 Background ...... 28 Objectives ...... 28 Implementation ...... 28 Employee Engagement And Participation ...... 29 Added Value ...... 29 Results ...... 29 On-going Activity And Longevity ...... 30 Case Study: McCain And UK Athletics ...... 30 Background ...... 30 Objectives ...... 30 Implementation ...... 30 Employee Engagement And Participation ...... 30 Fundraising ...... 31 Other Added Value Benefits ...... 31 Results ...... 31

SECTION TWO HOW CSR SPORTS PROGRAMMES ADD VALUE TO SPONSORS AND RIGHTS HOLDERS ...... 32 Sport Is Making A Difference ...... 32 Employee Engagement ...... 34 Evaluation And Measurement ...... 37 Case Study: Nike And GameChangers ...... 39 Background ...... 39 Objectives ...... 39 Implementation ...... 40 Employee Engagement And Participation ...... 40 Results ...... 40 On-Going Activity And Longevity ...... 40 Case Study: Standard Chartered Bank - Race For The Living Planet . 40 Background ...... 40 Objectives ...... 41 Implementation ...... 41 Employee Engagement And Participation ...... 41 Results ...... 41 On-Going Activity And Longevity ...... 41

SECTION THREE THE ROLE OF THE RIGHTS HOLDER IN CSR ...... 42 Rights Owners And Existing Community CSR Programmes ...... 42 Sports Must Reassure Sponsors That They Are Socially Responsible ...... 47 Tour de France Doping Scandals ...... 48 Issues Affecting The NFL ...... 49 Gambling Sponsorship, Sport And CSR ...... 50 How Gambling Brands, CSR And Sport Answer The Critics ...... 53 Case Study - Betfair And Sportsaid ...... 53 Background ...... 53 Objectives ...... 53 Implementation ...... 53 Fundraising ...... 54 Visuals ...... 54 Leverage ...... 54 Results ...... 55 On-Going Activity And Longevity ...... 55 Public Sector Funding To Boost CSR Activities ...... 55 Rights Holder Sponsorship Initiatives ...... 56 Case study: Women’s British Open, Ricoh And Seeds for Africa ...... 57 Background ...... 57 Ricoh ...... 57 Seeds For Africa ...... 58 Objectives ...... 58 Implementation ...... 58 Employee Engagement And Participation ...... 59 Results ...... 59 On-Going Activity And Longevity ...... 59 5

SECTION FOUR LINKING CSR TO SPORT AND AVOIDING PITFALLS ...... 60 Selecting The Right Sport ...... 61 Stakeholder Cynicism ...... 63 The Importance Of Being Socially Responsible ...... 65 Case Study: Aviva UK Athletics Sponsorship...... 70 Background ...... 70 Objectives ...... 70 Implementation ...... 70 National School Sport Week ...... 70 Community Sports Fund ...... 71 UK Athletics Grassroots Schemes ...... 71 School Sport Matters ...... 71 Results ...... 72 On-Going Activity And Longevity ...... 72

TABLE OF CHARTS, FIGURES AND TABLES

Figure 0.1. CSR Return On Investment Factor Relationships ...... 13 Figure 1.1. Identifying Stakeholders’ Impact On Corporate Value ...... 19 Chart 1.1. Global Consumer Care Levels For Social Issues ...... 20 Chart 1.2. Interest Levels In Sport - Major European Markets ...... 21 Chart 1.3. CR Index Companies V FTSE All-Share Index - TSR By Year .... 22 Chart 1.4. Shifts In Sponsorship Spend 2007 ...... 24 Table 3.1. The Adult Population of England’s Participation In Badminton .... 43 Table 3.2. Frequency Of Participation In Badminton In England ...... 43 Table 3.3. Summary Of Total Badminton Players In England ...... 44 Table 3.4. Sport England Funding For 2009-2013 ...... 46 Chart 3.1. European Cycling Sponsorship by Number of Deals 2007 ...... 49 Table 3.5. Lifetime Participation In Gambling Activities - 12-15 Year Olds ... 51 Chart 4.1. Interest Levels In Sport - Major European Markets ...... 62 Chart 4.2. Consumer / Property Relationship – London Marathon ...... 63

CSR & Sports Sponsorship Executive Summary

EXECUTIVE SUMMARY:

CSR In Business

Businesses today are expected to look beyond their bottom line and most accept they have a social responsibility to the health and well-being of the communities in which they operate.

The term corporate social responsibility (CSR) relates to the ethical and legal behaviour by organisations in the workplace and the wider community.

According to accountants KPMG, nearly 80 per cent of the largest 250 corporations in the world now publish CSR reports, up from about 50 per cent in 2005.

Businesses with a strong CSR programme ensure it sits snugly alongside their sustainable marketing policy, which focuses on how products are sourced, manufactured, promoted and distributed.

Organisations are choosing CSR projects which counter the negative impacts they might be having on the environment or on people’s lives. A strong CSR strategy will prove profitable for a company over the long term because its relationship with different stakeholders, from customers and suppliers to employees and the media, is boosted.

Ultimately a CSR programme will fail unless it is at the heart of the business decision making process and linked to how the organisation makes its money. Stakeholders also demand total transparency and any inappropriate activity or evidence that a company is involved in a social project for the wrong reasons, such as to attract positive media coverage, will attract fierce criticism.

CSR And Sport

For years businesses have tended to spend their CSR budgets on supporting environmental or arts-based causes but increasingly sport is being seen as a way to meet social and community obligations.

Sport is regarded as a much more influential channel than the arts; reaching and engaging with more people from across the entire social and demographic spectrum.

The European Sponsorship Association’s market trends survey of 2007 pointed out that CSR is becoming part of a more eclectic sponsorship mix. This is something that sports rights holders are starting to take advantage of.

Whilst pure sports sponsorship can often be based on hard-nosed marketing and business decisions, any CSR investment is based more on how a business can improve the communities in which it operates.

CSR & Sports Sponsorship Executive Summary

When a decision has been taken to spend all, or part of, a CSR budget around sport, sponsors are realising how important it is that they choose a cause and sport which has a synergy with the organisation’s own mission statement and values as well as its products and services.

Sport is an effective CSR medium because it boasts values that any socially- responsible business should be striving for. These include fair play to everyone involved including employees and suppliers, transparency and opportunities for all to succeed, as well as good community relations.

This report explores the issues surrounding brands, CSR and sports marketing. There are many examples of how businesses around the world are using sport more and more to fulfil their CSR obligations. Sport is adding value to the sponsor and individual sports and at the same time changing people’s lives on a local, national and international level.

Sports rights owners are certainly realising the mutual benefit of teaming up with brands to drive forward CSR programmes.

Nevertheless, individual sports have to prove their own social responsibility credentials to potential CSR sponsors when it comes to controversial areas such as the use of drugs and links to gambling or corruption. How sports look after their sportsmen and women once they retire is also a CSR obligation that must be tackled if brand sponsors are to come on board.

Like businesses around the globe, individual sports are also following their own CSR strategies, with soccer/football the most visible sport when it comes to its community investments. Most professional clubs have initiatives in place to help disadvantaged people improve their education or health.

The need to attract additional funding as the recession hits sponsorship revenues is another reason why corporate CSR budgets are being targeted by rights holders. The smart sports clubs, both professional and amateur, are also looking beyond the private sponsorship sector and realising money is available from public bodies such as the police and health organisations.

This is one area rights holders were generally not exploring until relatively recently. However, the funding of community sports-based projects in this way can be the catalyst to persuading private sector sponsors to get involved in sport too.

Cynicism Towards CSR

The report outlines the struggle that many organisations still face in overcoming media, public and employee cynicism when associating their CSR strategy with sport.

There are pitfalls to avoid if a CSR programme is to work for everyone. For example, all organisations must ensure their CSR/sports activity is perceived as relevant to the business and is run with integrity. Ultimately stakeholders want to see that a brand is being challenged by what it is doing and is not sending out confusing messages.

Another challenge for sponsors linking CSR to sport is research and measurement. This is a relatively new area and sponsors can struggle to budget effectively and many remain unsure about how best to assess their return on investment.

CSR & Sports Sponsorship Executive Summary

Ultimately there are a number of tests an organisation can use. Is the CSR activity legal and does it meet professional standards? How will any activity add value to the brand and the sport over the long-term and how will it be viewed by different stakeholders? Finally, what impact does a CSR programme linked to sport have on an organisation’s core values? What effect will it have on how employees view any activity? Companies must ensure their CSR programmes are strategic and well thought through. It must be efficient if it is to have a maximum impact on the sport, social cause and the organisation itself. CSR is about involving all stakeholders and identifying how the organisation can make improvements. This is not about claiming to be the best.

CSR & Sports Sponsorship Introduction 1

INTRODUCTION ONE. WHY CSR SHOULD NOT BE A DISTRACTION IF YOU ARE SERIOUS ABOUT MARKETING

By John Luff

John Luff founded the company Sustainable Marketing in 2004. He specialises in helping organisations identify and promote their brand and corporate social responsibility (CSR) and sustainability credentials.

He is a frequent speaker worldwide on the topics of brand, marketing, CSR, sustainability and communications. He was previously head of global CSR and head of global brand for British Telecom. In these roles he helped BT achieve its 3rd top rating on the DOW Jones Sustainability Index – the first time BT had achieved this on a global basis. He developed the brand positioning for BT and its joint ventures worldwide.

He is proud to have lead BT sponsorship of the Global challenge – ‘The World’s Toughest Yacht Race’. John is an associate faculty member of the British Chartered Institute of Marketing, a Founding member of the Superbrands CSR Advisory Panel and CSR advisor to the World Lottery Association. Recent/current clients include the world’s largest retailer, one of Europe’s largest shopping Malls, major financial institutions, major construction companies, sponsorship advisors, Business Schools, telecoms, IT and TV brands, cities, government and global sustainability organisations.

Consider the ultimate brand promise - from the earliest Stock Exchanges – ’My Word is my Bond’. Break that commitment and the consequences are instantly known to all in a closed, connected society.

Similarly think about the origins of ‘bankrupt’ (from the Italian for broken bench) where unethical dealing lead to the trader’s bench in the market place being broken and smashed. Trading ceased with the guilty party being literally thrown out of the market place.

The web, satellite, social networks and other digital media mean that today we can publicly break the metaphorical benches of unethical individuals, teams, corporations or organisations in full view of the global economy.

Any brand that breaks its ‘word’ or promise, risks not just the scrutiny of the city or guild but every analyst, pressure group and consumer worldwide. There are also the professional guardians of ethics, the regulators.

Stakeholders need to know organisations will deliver for them. Corporate Social Responsibility (CSR) without delivery is just words. An organisation’s brand is its promise. The one thing all stakeholders, worldwide, will forgive least is an unfulfilled or broken promise.

In the world of CSR the debate today is not just about the means of production and its effect on, say, climate change. It is also about the means of seduction.

CSR & Sports Sponsorship Introduction 1

How things are sold is as important as what things are sold.

The morality of promoting potentially harmful products or techniques which, for example, seduce minors into buying, continues to provoke debate. Quite right, but practical self interest is an even more potent driver of marketing in the direction of being ever more responsible and ethical.

The CSR specialists all too often see marketers as the embodiment of stretching what is ethical to the limits or at least making a living out of being economical with the truth. And many marketers regard those who specialise in CSR as over indulgently living in a fantasy world of ethical black and whites.

The reality is that professional marketers know that a brand not built on ethical marketing principles is living on borrowed time. That has always been the case, but with the internet, satellite channels, SMS and other channels that borrowed time can be very short indeed. This applies to all businesses but is particularly true of sport where media interest is so intense.

There will always be those seduced into using tactical approaches that are ethically questionable. But global communications today mean they do so in a market place where their actions are simultaneously under the microscope and spotlight of millions. And of course it is all about what you do rather than what you say.

In fact, the technological advancements mean that we have returned to the marketing ethics of that earlier age.

In the tight knit communities of pre-industrial Europe, everyone who was engaged in commerce was known to everyone else. Everyone was consuming much the same products and all traded in the same market places. Anyone identified as employing unethical trading or marketing practices would be very exposed, their actions known to all and the consequences very public. It was a small world.

This is a good time to talk about sustainability. This is too often over-simplified and taken to refer exclusively to environmental sustainability. Yet it also has economic and societal aspects. The most corporately irresponsible organisation is one which adopts a financially unsustainable approach or offers financially unsustainable services to its customers.

My argument is that in the context of business, especially service driven business, environmental sustainability is becoming the new Total Quality Management (TQM). Those of us of a certain vintage will remember that back in the 1980s, it seemed impossible to go longer than an hour without TQM entering the conversation. Today it would be counterproductive indeed for an organisation to lead its brand proposition with the fact that it is a TQM organisation. Promoting the fact would be as strange as putting up a sign in a retail bank which read ‘all our staff are honest’.

So sponsorships today that identify, build and promote societal and economic sustainability (whilst at the same time addressing environmental sustainability) must surely be something worthy of every marketer’s attention.

The need for sustainable economic strategies is, for example, now front of centre in the discussion of the role of sponsorship for the London 2012 Olympics.

CSR & Sports Sponsorship Introduction 1

And the ordinary soccer fan will use different language but the impact – good and bad - of big, non-indigenous sponsorship and ownership is now a topic familiar to most Premiership League supporters.

This presents those involved with sports sponsorship with an opportunity. Building sports facilities that are environmentally friendly is unlikely to create front page news – its business as normal. ‘Greening’ sports is similarly a basic necessity.

For example, Formula 1 based on green fuel and lower net emissions makes good sense in a business fighting for its sponsorship life. But the slow burn integration of sports with societal and economic issues offers real opportunities particularly as sports competes with the arts for community investment.

Turn away from ‘legacy’ Olympic build projects for a moment and look at the opportunities offered by a sport such as basketball in the UK. If you were to draw up a check list for a project any brand would like to be associated with then basketball ticks a number of boxes.

It promotes health, takes place in a multi-use facility which the community can use at other times, engages with different social groups both male and female, has street, national and international appeal and is a relative low cost sport to sponsor.

Assessing the return on investment (ROI) with respect to CSR and sponsorship is not easy. The best option is to consider ethical, sustainable, CSR linked marketing in three contexts. It helps to think of three, overlapping circles.

Figure 0.1. CSR Return On Investment Factor Relationships

WHAT

HOW LAW/ DUTY TONE of VOICE

VALUES VALUE ADD

CSR & Sports Sponsorship Introduction 1

Is the issue under consideration legal and compliant with the relevant professional and other standards? This is an increasingly difficult task in a global economy but by definition cannot be avoided. So will your sponsorship approach illuminate your transparent approach to corporate governance and finance? This is an issue that English cricket has had to consider recently. This is not about fairness and justice. It is, as usual with brands, about perception. Brands concerned with survival in the current era of distrust want to be associated with projects that are ethical and perceived to be ethical.

It is also important to understand what the long-term positive and value-added contribution your CSR activity around sport will make when viewed through the filters of key stakeholders. ‘Value add’ cannot just be measured in terms of ‘profit up’ and ‘costs down’. The answers to the questions ’does this make life better and does this make life easier?’ count too.

This is a crucial aspect of ROI for any sponsor in a regulated industry because these are the questions which drive regulators and their masters; politicians and the media. To put it crudely, if you are seeking a licence or permission to exist/operate you need to demonstrate in visible terms that the regulators can ‘sell’ to their constituents that you are making a long term, sustainable contribution to society. Appropriate sports sponsorship, linked to community and environmental projects, can help.

Finally does the issue impact on the core values of your organisation? This only works when there is a clear statement of ‘The Way We Work’ or something similar in the organisation to define its culture. Otherwise, everyone engaged in communicating is free to create their own interpretation of what they believe the organisation stands for and will or will not tolerate.

When an organisation is clear about what it has to offer in each of these areas (circles) it can then consider what its priorities are, how these can best be communicated/marketed and with what tone of voice.

In other words if you are considering sponsorship you can identify what is right for you in the long term. And, if you are selling sponsorship, you can be clearer about your long term, positive contribution to the societies you potentially impact directly and indirectly. This is CSR. Then you set measures for ROI appropriate for each circle according to your aims and needs.

Measuring any marketing activity against the three metrics of law/standards, value add and core values is nothing new. It happened in those pre industrial markets I referred to at the start. But ethics is not a science and our judgements can be called into question by anyone with access to communications infrastructure.

How we perform against those metrics today is almost instantaneously visible to the world. That means that neutral is not an option. We are all challenged, all the time to demonstrate our positive contribution to the societies we impact directly and indirectly.

The days are gone when we could argue that the business of business is business, and that climate change, modes of profit making, human rights and so on are the province of government.

Even if you happen to believe that business should stay out of these issues your supporters, customers and other stakeholders do not.

CSR & Sports Sponsorship Introduction 1

This last point is growing in relevance. We all know that when a brand loses trust it is in deep trouble. But I would offer you another thought. I can’t prove this. I have no research data. But it seems to me that particularly in the world of service industries, including sport, stakeholders will forgive much with respect to CSR when times are good.

To put it crudely they may regard the sector as populated with fat cats but at least they are competent fat cats generating wealth and entertainment. But what happens when times are not so good and those same folks are regarded as incompetent fat cats? In this scenario before we can regain trust we have to be seen as competent. Throwing money at a list of good causes without a transparent community engagement strategy will not increase a perception of competence or trust.

This applies as much to time as money. In a recent UK article the general secretary of the Professional Players Federation bemoaned the fact that “ ‘Sportsman does good deed’ is never going to be a sexy headline” and then went onto point out that “During the last season, footballers made 18,500 community appearances supporting a massive range of social projects. An increasing number of players have their own charitable trusts”.

So what does all this mean for business? There is little doubt that 2009/10’s sponsorship and advertising budgets are going to feel the effects of the recession. It will be interesting to see what happens to CSR budgets – hopefully they will be resilient.

In this environment the only sustainable marketing is visible, well communicated ethical marketing. Communicate, communicate – if you don’t stakeholders will assume that you have something to hide.

CSR and integrity in marketing is not optional, especially when economic and social (as well as environmental) times are hard. But this is not the only strategic option. You can choose to ignore CSR but if you do, in the words of that wonderful song smith Warren Zevon, be prepared to “send lawyers, guns and money”. You might well need them.

CSR & Sports Sponsorship Introduction 2

INTRODUCTION TWO. THE CHANGING FACE OF CORPORATE SOCIAL RESPONSIBILITY AND SPORTS MARKETING

By Mallen Baker

Mallen Baker is a writer, speaker and strategic advisor on corporate social responsibility and founding director of Business Respect.

He is a regular columnist with Ethical Corporation, as well as being a member of the Ethical Corporation Advisory Board.

Mallen was formerly the development director with Business in the Community (BITC), where he was responsible for developing BITC's approach to marketplace issues, which includes how companies manage issues that arise around their core products and services. He produced the Marketplace Responsibility Principles working with a leadership team of CEOs from major companies headquartered in the UK.

Mallen chairs the CSR Superbrands project in the UK, and is a member of the Social Marketing Standards Advisory Task Group. He chairs Kingfisher plc's Stakeholder Advisory Panel, and was a board member of CSR Europe 2006 - 2008.

When business writers look for metaphors, they often turn to the world of sport. The reasons are obvious – both disciplines involve a competitive situation where the one with the greatest skill, the most effective training, and the sheer determination – wins.

The other thing they have in common is that each is carried out within a discipline of rules. These can be required (the rules of the game = the law of the land) or they can be implied (expectations of sportsmanship = good corporate citizenship).

For business, the rules have been changing, and changing pretty fast. The expectations that society has upon business have shifted, and businesses have been moving fast to keep up. This is the process that has driven corporate social responsibility (CSR).

In the Western world, CSR has been on a rapid development path that has seen change as the only real constant. Twenty five years ago, it was all about how businesses get involved in local communities – whether through donations, employee volunteering or the in-kind support of goods or services. Now – although those aspects continue to thrive – the focus has become much more about the responsibility of businesses on how they make their money.

Whether it is food companies and the issue of childhood obesity, apparel companies and labour rights in their supply chain, or absolutely everyone and the issue of climate change – companies are now facing more challenging expectations.

CSR is fundamentally about relationships – the relationship between the companies or its brands and customers, suppliers, government, employees and communities. That makes it by definition subject to change over time, and also to different groups moving the goalposts.

CSR & Sports Sponsorship Introduction 2

The most trusted brands are those that have taken the initiative, positively building trust rather than waiting for the moment when they have to defend their reputation from attack.

In the UK retailer Marks & Spencer (M&S), for instance, identified that its customers did not expect to have to decide on the details of what chemicals they would or would not accept in M&S products – they expected the company to do the research and then to do the right thing in its customers interests.

In response M&S gradually built its initiatives across its product ranges to the point where it was well placed to give its social and environmental commitments a much higher profile. Its ‘Look Behind the Label’ campaign has been an effective part of the new resurgent M&S refreshing its appeal particularly to younger audiences that had not identified with the values of the brand previously. But it was only able to do this once its practice in this area was completely robust – the customer has over the years developed a fine nose for sniffing out false claims.

Of all the issues that have appeared on the horizon in recent years, the one that has grown to the point where no-one can ignore it is that of climate change.

No-one is untouched by this. When the Honda F1 team took the brave step of clearing sponsor logos off their car in order to promote an environmental message – it was a challenge that quite a few in the high octane high impact world of Formula One did not welcome.

But the point has been recently underlined – when interviewed about whether he would take over Honda F1 after the financial downturn had prompted Honda to withdraw, Virgin Group boss Sir Richard Branson said that it was on his mind. However, a commitment to pioneering green technology would be a prerequisite.

Branson, of course, has a track record in making bold moves in this space. He pledged all of the profits associated with the Virgin transport businesses to research into environmental technologies. This measure – rather more dramatic than a plc’s shareholders would be likely to tolerate – has nevertheless served to underline just how seriously businesses are taking the challenge.

Many sporting institutions have recognised they carry special responsibilities in different areas.

Football clubs, for instance, know they have the attention of many young people within their local communities – they can provide outlets for those that might otherwise find them in less welcome pursuits. They can make a difference in those communities, whether it is in promoting community service and education, encouraging active lifestyles in the face of growing levels of obesity or delivering anti- racism messages.

The other reality of sport is just how much the big occasions have become flashpoints for campaigners that want to focus on an issue of corporate irresponsibility.

The sponsors of the 2008 Olympic Games did not want to become embroiled in a long debate over the human rights obligations of the Chinese government – they wanted to buy into an exhilarating, inspiring world event. And probably most would say, after the occasion, that they achieved this in the end. But there was a lot of conflict on the way and a real danger that the companies would suffer damage to

CSR & Sports Sponsorship Introduction 2 their reputation, and sport would lose future sponsorship out of fear of such consequences.

This is one of those unfortunate facts. Not all of the social and environmental responsibilities of businesses start and finish with those aspects that the company can control. Much of the bad press out there about individual companies and brands attaches to what happens in their supply chain. Customers and NGOs make no distinction. If your supplier abuses human or labour rights, it will be the buying company and the big brand that gets the attention.

Nike of course was the first one to be hit hard by this. Once a scandal has become associated in the public mind with a brand, it can be very hard to shake. The company is now rated to be one of the best in the world for dealing with its huge and diverse supply chain, and talking transparently about its problems. There are still, however, a lot of people out there for whom the brand remains synonymous with the sweatshop. Once lost, a reputation is hard to rebuild.

There is no magic bullet in CSR that guarantees success purely because of good intentions – just as there isn’t in any other aspect of how brands are created and promoted. But in building trust with customers, it has become a new prerequisite.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

SECTION ONE. WHY SPONSORS NEED A CSR STRATEGY LINKED TO SPORT

During difficult financial times it becomes even more important for businesses to strengthen relationships with their key stakeholders and linking CSR to sport allows organisations to do this.

Stakeholders include existing and potential customers, employees, suppliers, shareholders, other investors, the media, pressure groups, trade unions, local communities, local politicians and competitors. Each group has the ability to affect the success of an organisation.

Figure 1.1. Identifying Stakeholders’ Impact On Corporate Value

STAKEHOLDER + COMPETITIVE + VALUE DRIVERS = SHARE PRICE PERFORMANCE ADVANTAGE

Customers eg Improve trust IMPROVE PERFORMANCE Employees or exploit brand - sales Suppliers - costs Community - lower taxes Governments REDUCE COST OF CAPITAL Environment - gearing - reduced volatility REDUCED CAPITAL INTENSITY

Source: Cranfield University School of Management

CSR has it early roots in business philanthropy but has evolved to become increasingly recognised as making good business sense. It is often described as the ‘triple bottom line’, providing an economic, environmental and social return for organisations that practice it effectively.

Consumers are citizens and citizens are consumers so it is understandable why proactive CSR activities around sport can be more effective for a business than simply making a charitable donation.

CSR is ultimately a marketing investment and the benefits in terms of PR and customer loyalty, raised brand awareness, staff engagement, enhanced recruitment and staff retention can be considerable.

Millions of consumers around the world are involved in social causes and they want to make a difference. It is why they are increasingly supporting brands that have the same attitude and which they can see have CSR initiatives in place.

According to the Endelman second annual consumer Good Purpose Study published in 2008, nearly 90% of consumers feel it is their personal duty to contribute to a better society and the environment.

Some 83% are willing to change consumption habits to make the world a better place, with 76% of consumers globally claiming they would like to buy from brands

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport that support worthy causes. Community sports projects or sports-related initiatives which help to change lives around the world would certainly tick the box of most consumers.

Chart 1.1. Global Consumer Care Levels For Social Issues

Supporting the creative arts 88%

Helping to raise people's self esteem 86%

Fighting HIV/AIDS 84%

Building understanding/respect for other cultures 82%

Supporting human and civil rights 80%

Equal opportunity to education 75%

Reducing poverty 73%

Improving quality of health/healthcare 72%

Protecting the environment 63%

0% 20% 40% 60% 80% 100%

Source: Endelman Good Purpose study

All the issues mentioned by those questioned in Chart 1.1 can and are being addressed through sports-related CSR projects.

A realistic, robust and relevant CSR plan linked to sport can be crucial to driving business relationships forward because sport has the ability to reach and appeal to all social demographics.

A survey by market researchers SportFive in 2006 (overleaf) confirmed that very few people across Europe claim to have no interest in sport. In every country it found that at least 60% of the population claim to be either ‘very interested’ or ‘quite interested’ in sport.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

Chart 1.2. Interest Levels In Sport - Major European Markets

50 45 40 35 30 25 20

10 5 0 Spain Italy England France Germany

Very interested Quite interested Not very interested Not interested at all Source: SPORTFIVE

Another reason why sport is appearing on many companies’ CSR radar is because the ethics and standards associated with sport are seen as matching a sponsor’s own principles and ideals.

These include playing fairly, taking responsibility for the health and safety of those participating (in the case of an organisation this would include employees, suppliers and consumers). There is also the issue of business transparency and access for all (in terms of career progression opportunities for staff), relations with the local community and training and coaching, which brings long-term benefits to the company and its stakeholders.

Sport also encourages participation which means employees and consumers can get involved in CSR programme at a local level.

Most CSR strategies linked to sport are also viewed positively and less cynically than some social or environmental projects might be. This helps a brand to build trust among its various stakeholders, which is one of the most important objectives of any CSR project.

CSR’s Impact On Brand Awareness And Sales

As the Endelman survey has shown, younger consumers, known as the Generation Y workforce, increasingly want to work for businesses that share their values. This group, those born between 1978 and 1990, are more independent and entrepreneurial than their parents’ generation. They are also not scared to take their skills to different industries and demand certain standards of social responsibility from their employers. However, with jobs for graduates so hard to come by in the current recession, they might have to compromise on their morals slightly.

According to audit, tax and advisory firm KPMG, nearly 80 per cent of the largest 250 corporations in the world now publish Corporate Social Responsibility (CSR) reports, up from about 50 per cent in 2005. The sample of more than 2200 companies

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport includes the Global Fortune 250 (G250) and the 100 largest companies by revenue (N100) in 22 countries.

The report covers many international markets including Sweden where in November 2007 the Swedish government became the first in the world to publish mandatory guidelines for sustainability reporting for all state-owned companies. These guidelines state that a company’s sustainability report shall be subject to assurance by a third party.

Since the previous KPMG survey in 2005, the number of Swedish companies, for example, included which publish sustainability reports has more than doubled to 59 and 47 also report on their carbon footprint. It seems its companies are more aware of their impact on the environment and on the communities where they operate than they were four years ago.

Linking CSR more specifically to sport can not only satisfy the social conscience of any organisation and its stakeholders wherever they are in the world, but also provide an enviable marketing platform. A CSR initiative will cover a range of disciplines from brand equity, public relations, direct marketing, corporate hospitality, staff engagement, recruitment and research.

It is certainly true a CSR strategy around sport will have an effect on brand awareness and ultimately sales, but this is more of a by-product than a blatant reason for getting involved in a particular cause. The companies that already spend millions of pounds on sports-related CSR activities are extremely subtle in how they talk about return on investment when measuring and evaluating their involvement. Nevertheless, it is in the interest of all businesses to take CSR seriously.

In Britain, Business in the Community has evidence that companies that consistently participate in its CR Index outperform the FTSE350 stock market on total shareholder return. Between 2002 and 2007 the level to which they outperformed was between 3.3% and 7.7% per year.

Chart 1.3. CR Index Companies V FTSE All-Share Index - TSR By Year

TSR 0 2002 2003 2004 2005 2006 2007 -10

-20

-30 CRI Companies All Share Index FTSE 350

Source: BITC Stephen Howard, chief executive, Business in The Community says that in an economic downturn CSR is more important than ever. “It is essential we drive the CSR agenda forward with a renewed engagement in issues such as incentives,

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport rewards and governance,” he says. “These are difficult issues but it is critical they are explored and addressed if we are to strengthen relationships with stakeholders.”

Marketing agencies expect sport to become an even more popular choice for companies looking for a return from CSR because it is a bigger channel than the arts and the environment. It reaches more people and is arguably more powerful at engaging with a wider range of consumers. This is something sports rights holders have been slow to realise until now as they have preferred to chase traditional sponsorship revenue. Money tucked away in separate CSR budgets within organisations should be targeted more proactively.

CSR is being given greater importance in the boardroom, and the budgets for social responsibility programmes are increasingly being controlled by the human resources department rather than the marketing team.

This will have an effect on where the money is spent. It means that sport has an opportunity but it must shout louder than it has in the past. Where the human resources department controls the purse strings there can still be a preference for arts, social cause or environmental activities as well as supporting charities and schools. Whenever the CSR debate involves making a difference in people’s lives sport needs to explain more clearly how it can cross into all these other sectors.

The Influence Of Business And Sport In The Local Community

The worlds of business and sport have much in common when it comes to CSR, but they also offer complementary things which should mean both sides can meet their objectives when a CSR sponsorship is agreed.

Both are members of the community, yet where sport has a big advantage over the business world is its ability to connect with consumers. This is particularly true when the corporate world is trying to engage with young people.

Sports clubs, associations and sporting bodies enjoy close relationships in the communities in which their participants and spectators live. Provided this is managed effectively, the brand owner can enjoy the benefits of these existing relationships very quickly once a CSR programme is up and running.

For the individual sports, the prospect of additional funding to promote grass roots participation means convincing business to use sport as part of a wider CSR strategy can have some lucrative benefits.

The European Sponsorship Association’s sponsorship survey 2007 revealed that CSR is now more likely to be activated as a sponsorship to give a return. The biggest challenge, says the ESA, is how to measure that return. See Section ‘Adding Value’ for more on this.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

Chart 1.4. Shifts In Sponsorship Spend 2007

45%

59% 60% 71%

41% 23% 30% 20% 18% 14% 10% 9% Sport Arts/Culture Entertainment/Music Community/Cause Related

Decrease Same Increase

Source: European Sponsorship Association

A sports-related programme should always sit within a broader CSR strategy and complement other activity.

Food company, McCain (see case study below) is a huge supporter of UK athletics but it has a much deeper CSR programme. Away from the track it has constructed three 125m high wind turbines at its Whittlesey plant at a cost of £10 million. This is the largest potato chip factory in the UK and McCain is the first UK food manufacturer to power a site of this size using alternative energy.

Andy Paul, partnership manager and programme delivery manager for governing body UK Athletics, says McCain is helping emerging athletic talent and encouraging more young people to join athletic clubs. “The McCain deal should convince other sponsors. Our sport was criticised in the past for not bringing in money at the lower level and this is a great way for brands to build their own profile,” he says.

Whilst there are plenty of companies investing large sums in CSR/sports initiatives there are examples of some sponsors actually reducing or changing their involvement for strategic reasons.

In the US where CSR is better know as Corporate Citizenship, home improvement retailer The Home Depot, which boasts a number of community initiatives including building housing for the underprivileged, announced in January it was adapting its CSR sports sponsorship strategy. This has meant ending its sponsorship of Olympics and Paralympics athletes.

The company has been an Olympic sponsor since 1992 and has employed more than 660 athletes through the US Olympic Committee’s Olympic Job Opportunities Program. It has supported similar initiatives in Canada and Puerto Rico.

It gave athletes full-time pay and flexible working hours to accommodate their training schedule. The return has been impressive with 300 Home Depot athletes making the Olympic and Paralympic teams and bringing home nearly 150 medals, 95 of them gold. Before the Beijing games 137 athletes were in the programme.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

Home Depot claims the faltering US economy was not to blame but that it wants to find new ways to reach out to customers and staffers. It would not reveal how much it spent on the programme but it could impact on its advertising budget around the next Olympic Games.

The company’s total advertising and marketing budget in 2007 was $1.2bn according to its 2007 annual report, the most recent available. According to IEG Sponsorship Report, Home Depot spent up to $60m on sports sponsorships in 2007. In 2008 the company did start to sponsor soccer, the NFL and Major League Baseball.

In Europe, The European Sponsorship Association believes sponsors and rights holders have a responsibility to invest in the future of individual sports for the good of everyone. The ESA has set up a working group to analyse the whole issue of CSR. It is being overseen by board director Peter Wilkinson.

“The key is to look at the geography of your business and link it to relevant sports and issues that your stakeholders are interested in,” he says.

He accepts that more robust research is needed to ensure any CSR activity around sport has maximum impact.

“Global sponsors must recognise there are cultural differences when it comes to which sports will really engage staff and the local community. Basketball is more popular in France and Italy than in the UK, for instance,” he says. “Corporate responsibility needs to be clearly understood by companies as it covers not just sports participation but other social issues such as human rights. How and where was a sports team’s kit manufactured, for instance?”

The sportsmen and sportswomen are also realising they need to give something back to society and many have implemented their own social responsibility strategies. Former French football captain and FIFA World Cup winner Marcel Desailly, for example, is a goodwill ambassador for the children’s charity UNICEF. He has visited Ghana, his country of origin, to encourage children to go to school.

Critics of professional soccer have accused the sport of leaving its working class roots behind, becoming obsessed with money and for turning a sport into purely a business. From a CSR perspective, this has prompted Supporters Direct, the UK supporters’ trusts initiative that encourages fan ownership in football clubs, to launch the Social Value of Football Clubs Research Project.

Supporters Direct chief executive David Boyle says there are 13 professional clubs under supporter ownership and 40 have a significant fan ownership. The research project will look at what evidence exists to demonstrate that having supporters more closely involved in running local football clubs has an impact on the communities they serve.

The criticism that is thrown at professional football is unfair considering the vast number of CSR programmes that exist around the sport. Many of the sport’s big brand sponsors are also complementing their more traditional sponsorships with active CSR programmes.

The English FA Premier League’s main sponsor, Barclays regards sport as a powerful tool to engage hard-to-reach groups and as a way to address social issues including education, health (such as HIV/AIDS), life skills, entrepreneurship and women’s empowerment around the world.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

In 2006 the bank signed a £65.8m three-year extension to its sponsorship with the Premier League taking the deal up to 2010. The company won the 2004 National Business Award for CSR and it runs the UK’s largest community sports sponsorship programme, Barclays Spaces for Sports, worth £30 million.

Spaces for Sports has created sustainable sports facilities for disadvantaged communities. The first flagship site was the White Hart Lane Community Sports Centre in London in November 2005.

Today approximately 53,000 people a week are using the more than 200 Barclays Spaces for Sports sites across the country. This is raising the profile of the financial services company in local areas. At a time when banks are struggling to regain consumer trust following the global financial meltdown, a CSR strategy around sport will not do the brand any harm at all.

Barclays has now begun to extend the idea to other countries starting in South Africa, Zambia and the USA.

Barclays decision to focus first on South Africa is a tactical one considering the nation is hosting the FIFA World Cup in 2010.

One Barclays project is in Gansbaai in the Western Cape where most residents have never had access to community sports facilities. Barclays is developing the Gansbaai Communal Sports Centre with the help of three racially-segregated communities. There are now areas for football, rugby, netball and athletics. There is also a community meeting room for local gatherings. The involvement of Barclays in the area has prompted additional social action by local businesses and governments.

In the US, Barclaycard is using Barclays Spaces for Sports to help the East Side Charter School in Wilmington, Delaware, by improving sports facilities. In a neighbourhood known for drugs, violence and high teenage birth rates, the programme involves building two basketball courts, a baseball diamond, soccer and football fields as well as play areas for the youngest members of the community.

The Olympic Games

Taking the CSR route could be the best way for many brands to be involved in the Olympic Games.

Money from CSR budgets will join other private sector fundraising initiatives for elite sport being promoted by national governments.

In February, The London Organising Committee for the Olympic Games and Paralympic Games (LOCOG), the British Olympic Association, British Paralympic Association and UK Sport announced they were pooling their collective rights to help raise additional funds. This stream of funding will be on top of the £550 million for the final three years of the Beijing Olympic cycle and the four years of the London Olympic cycle through to 2013. It means that for London 2012 there will be a package of Lottery, government and private investment. There will be public funding of more than £300 million between 2009-2012 for British teams at London 2012. The hope is that this money will create a lasting legacy from the Games which will link in with the many community projects taking place.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

Yet there has been criticism that too much money is going to elite sport at the expense of grass roots sport. This is another reason why sponsors with CSR budgets have an opportunity to help sport at a local and community level and reap the benefits of stakeholder goodwill.

There is certainly a trend for sports bodies and athletes themselves to look at different pots of money for funding. Tapping into the social conscience of the public is raising awareness among larger commercial sponsors looking for ways to spend their CSR budgets.

In the UK there is an initiative called BeNumber1 which is seeking to raise additional funds for potential Olympic champions in the run-up to London 2012.

Its creators include the sailors Sarah Webb and Sarah Ayton and their sports agent Hugo Ambrose. They realised that they needed more funding because National Lottery money covers only 40% of the cost of preparing to compete at the Olympic Games.

BeNumber1 is selling pixels on its websites to individuals and companies. The aim is to raise about £80,000 from each page of 999 sponsored pixels which will be money that will go to about 300 athletes. The pixels are being sold off for £20, £50, £100 or £1,000 a year so a total of £24m per year could be raised up to 2012 and beyond.

“London 2012 should be a catalyst for getting more people and sponsors involved in sport,” says Ambrose. “Many rights holders and sponsors are still behind the curve when it comes to getting involved in sport for CSR reasons. Also, a lot of companies would like to do it but they do not know how to go about it.”

The money from BeNumber1 is intended to go straight to the athletes but the organisers would like to work more closely with the sports themselves. However, the scheme has hit some resistance among sports governing bodies despite talks taking place to share the money between the individual athletes and the sport.

There have been disputes over individual image rights, for instance. There are also difficult issues around the potential conflict between BeNumber1’s sponsors and the top athlete’s own sponsors. “This is a complicated area and it is hard to get everyone to agree to make this work because everyone has their own agenda,” says Ambrose.

Of course, any company linking its CSR strategy to the Olympic Games must be prepared to answer questions from activists who will want to see brands making an actual social difference around the Games.

Purely being listed as a sponsor and claiming this involvement ticks a CSR box because the Olympics is still perceived by some as being a purer athletic event and less commercial than, say the FIFA World Cup, will find their activities criticised.

The Beijing Games were tricky for sponsors taking a CSR approach because of China’s record on human rights. Its treatment of disabled people was also arguably contrary to the ethics of the Paralympic Games.

There were, however, some good examples of Chinese companies integrating their own CSR strategies into the Beijing Games.

Yili Group, a major enterprise in China’s dairy industry, made CNY5million (€575K) available to support the sports development of the Inner Mongolia Autonomous Region, of which CNY1.3 million (€150K) was awarded to participants in the Games.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

Yili was the only dairy sponsor and for each gold medal won by a Chinese athlete the company put CNY200,000 (€23K) into a Healthy China Plan for the health development of Chinese youth and teenagers. Healthy China is the CSR system set up by the Chinese Ministry of Civil Affairs and the Chinese Olympic Committee.

Another Chinese company to use the timing of the Beijing Games to highlight its CSR strategy was electronics company and Olympic sponsor Lenovo. It designed the Olympic Torch and published its first corporate social responsibility report in Beijing in August 2008.

Lenovo announced that CNY5 million (€575K) donations made by its employees will help rebuild No 1 Jialing Middle School of Guangyuan City, Sichuan Province. Lenovo also nominated five earthquake heroes to be torchbearers for the Paralympic Games in Beijing.

Case Study: Corus And British Triathlon Federation

Background Corus is the world’s fifth largest steel producer. The Company was formed following the merger of Koninllijke Hoogovens N.V. with British Steel Plc in 1999. The company, headquartered in London, is now a subsidiary of Tata Steel, part of India's Tata Group.

Corus became the premier commercial sponsor of British Triathlon in 2006. For Corus the deal provides a match between its own values and those of the sport in terms of a determination to succeed with motivated and passionate people. This sponsorship is a core part of Corus’ CSR strategy. The intention has been to help the grass roots and long-term legacy of a sport which entered the Olympics for the first time in 2000. Corus is helping elite triathletes prepare for 2012 and is getting involved in a number of community-based initiatives involving nationwide triathlon programmes in schools across the UK.

Objectives The main aim is to give greater exposure to the sport using school programmes and working with the national governing body British Triathlon to develop a three-race series of elite events. The community activity is a central part of boosting the sport’s exposure and Team GB’s chances for medals at London 2012. One of the aims for British Triathlon is to achieve its mission of establishing Britain as the world’s leading triathlon nation. The grass roots support from Corus should help the sport to leverage additional public funding and provide a long-term legacy for the sport beyond 2012.

Implementation

The sponsorship has been activated through a series of initiatives mainly aimed at grassroots level that, on the whole, deliver social and community benefits.

Corus’s work in schools has led to the creation of the Corus Kids of Steel initiative which is designed to get children interested in Triathlon. At a time when childhood obesity is at an all time high, Corus and British Triathlon are helping the government's Healthy School Programme by giving kids an opportunity to take up a new sport whilst learning about healthy living.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

The company is also helping athletes with a disability at a community level. The company developed the National Disability Triathlon Project which includes paying the salary of a full-time National Equality and Diversity Manager

To help the elite athletes a new series of televised events was created called the Corus Elite Series. It means triathletes will compete on home soil against some of the world’s best

Employee Engagement And Participation

Corus has 47,300 employees in more than 40 countries and sales offices and service centres worldwide. The sponsorship with British Triathlon is an opportunity for the company to demonstrate its commitment to the health, safety and wellbeing of its staff and their local communities. Employees are encouraged through workplace schemes to participate in triathlon.

Added Value Corus is managing all aspects of the sponsorship. This includes event publicity, race media management, national and regional publicity to raise the profile of the sport, the events and the athletes and working with the sports industry and government. Corus was also able to support British Triathlon through its modernisation process. By providing advice and support on management structures and policy, the British Triathlon Federation now has three membership organisations: Triathlon England, triathlonscotland and Welsh Triathlon. This arrangement is part of the BOA/FTSE initiative which matches corporations with governing bodies so they can work together.

Results Some of the most impressive results have come from Corus’ support of disabled athletes. This has led to the establishment of the world’s first disability classification system for triathlon. The inaugural British Disability Championships took place on June 1 2008 in Rotherham, England, featuring 21 athletes. They started the race in the water in preparation for the 750m open water swim, followed by a 20km cycle and 5km run. Transition between each section was arranged so that wheelchairs, tandems and hand-cycles and assistance were available if needed.

Two young British triathletes with real prospects for 2012 have benefited from the sponsorship. Will Clarke and Helen Tucker, both in their early twenties, have graduated from British Triathlon’s development programme and have received Corus Awards for making the transition into the senior ranks.

During its first year in 2007, Corus Kids of Steel, a series of 13 events, engaged with 200 schools with a similar number in 2008. The 2008 Corus Kids of Steel programme worked closely with schools and clubs to ensure that interested young people had access to club training and competition following the events. The 12 events were held during May and June in 12 locations across England, Scotland and Wales. Leading triathletes, such as national women’s champion Helen Tucker, were involved to inspire children.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

On-going Activity And Longevity Details of the 2009 activity and sponsorship have yet to be announced. Corus and British Triathlon were not commenting on on-going plans. British Triathlon spokesman Peter Holmes says there is no problem with the sponsorship but the body is not promoting its relationship with Corus in the current business climate.

Case Study: McCain And UK Athletics

Background Brands such as McCain face a constant battle make their favourite family foods healthy and ensure they are perceived as healthy. The company was approached by rights holder UK Athletics which liked what McCain was doing in schools to get children to eat more healthily by educating them about nutrition. UK Athletics could see the benefits of a joint strategy linked to McCain’s CSR commitments and to promote its own ‘calories out’ message when trying to convince youngsters to take up the sport. McCain’s Oven Chips contain only 5% fat and no cholesterol. The brand is now spending £5m over five years as the Principal Partner of rights holder UK Athletics and title Sponsor of the McCain Young Athletes League and McCain UK Challenge events.

Objectives McCain is supporting amateur and semi-professional athletes at all levels except at the very top level where Aviva’s sponsorship kicks in. Its CSR objective is to raise the profile of athletics and get families more active by encouraging children to join local athletic clubs. The McCain/UKA target is to increase participation in the sport by 135,000 by creating and working with a national network of athletic clubs and to help them to obtain additional funding from Sport England.

Implementation The programme was launched in London in September 2008 by British Olympic 400m hurdles champion Sally Gunnell. She is the face of the partnership between McCain and UKA and attends events and demonstrates to children how to hurdle.

McCain provides all of the sports equipment needed for children to try different athletic sports. A virtual sports stadium is set up in what is in effect a large blow-up tent. It includes a running track and room to throw javelins. Some 5,000 people took part in four national roadshows in 2008. There will be at least twice as many events during 2009.

Employee Engagement And Participation McCain holds a Friday fun run on the first Friday of every month when about 30 staff complete the 2.7 mile course. The company has used its link with UKA to complement its internal employee well-being programme ‘McCain in Motion’, which encourages staff to choose a healthier lifestyle. Employees are also invited to attend Grand Prix athletic events.

CSR & Sports Sponsorship Why Sponsors Need A CSR Strategy Linked To Sport

Fundraising The first £300,000 spent in McCain Track & Field, a nationwide campaign to make athletics more accessible to more people, was matched by Sport England. The money is being made available to networks of local athletic clubs to bid for. About 20 networks have received funding and about 30 more were due to benefit when the latest funding was allocated in March 2009.

Other Added Value Benefits The McCain logo features at televised athletic events whilst the link with UKA has helped the company in its broader marketing communications by stressing to consumers and other stakeholders such as the media that it is important that food brands address the ‘calories out’ issue to create a healthier Britain.

Results McCain has a brand presence at competitions across the country with 56 events a year. It is still too early to have any hard evidence of the impact that McCain’s CSR work with athletics is having, but the company is committed to being involved in the sport beyond London 2012. This should mean it avoids too much stakeholder cynicism and reduces criticism that it is after a short-term halo effect on its brand image. The initiative has been widely covered in the media, but without McCain promoting any of its products. No product samples are distributed at events, for instance, so this also avoids any negative press coverage.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

SECTION TWO. HOW CSR SPORTS PROGRAMMES ADD VALUE TO SPONSORS AND RIGHTS HOLDERS

Brand sponsors are realising the benefits of CSR and how they can add value to their own businesses - through stronger stakeholder relationships - and to the sports and causes they choose to support.

Sport Is Making A Difference

Sport’s ability to make a difference in society is why it has risen up social and political agendas across the globe in the past decade. It is also why sponsors want to get involved on a deeper level.

Following a roundtable discussion during the Salt Lake City Olympics in February 2002, the United Nations invited senior executives within the children’s emergency and development charity UNICEF to co-chair a United Nations Inter-Agency Task Force on Sport for Development and Peace. The task force was set up in November 2002 and reported within four months, such was the interest in the whole idea of using sport to change people’s lives.

The mission of the task force was to encourage a more coherent approach to use sport-related initiatives as a tool to help the United Nations pursue its various development goals, particularly at a community level.

The recommendations of the Task Force included:

 Doing more to integrate sport into the UN’s development agenda

 Incorporating sport as a useful tool in programmes for development and peace

 Including sports-based initiatives in the country programmes of UN agencies where it was appropriate

 Attracting greater attention and resources from national governments for sport-related UN initiatives

 Focusing communications-based activities using sport on well-targeted advocacy and social mobilization, particularly at national and local level

Among the successful recent events to come out of this initiative were the 2008 Global Peace Games for Children and Youth which took place in 49 countries.

These Games embrace the themes of the United Nations International Day of Peace, the United Nations Millennium Goals and the objectives of FIFA Fair Play. Each participant at the Games was asked to sign a pledge that they respect all life, reject all violence, share with others, preserve the planet and contribute to the development of community.

One brand supporting the United Nation’s Millennium Goals is Nike. It contributes more than $100m in cash and products to non-profit partners around the world as part of its Let Me Play CSR/sport programme.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

The Millennium Goals include ending poverty and hunger, universal education, environmental sustainability and combating HIV/Aids. Nike has attached itself to the aim for gender equality.

The company believes in empowering girls and women and has partnered with the non-profit support system for social entrepreneurs called Ashoka Changemakers in a programme called Gamechangers (see case study below). This is an online competition designed to focus attention on the challenges faced by women in sport today and to identify the innovative solutions to tackle them.

Nike is also a founding partner of ninemillion.org, a UN Refugee Agency-led campaign committed to raising awareness and funds for education and sports programmes for refugee youth around the world.

Despite its considerable work around CSR and sport, Nike has felt the wrath of consumers over the years. It is unfortunate for the brand that its impressive CSR activities in recent years, particularly surrounding sport, have not had more of an effect in placating its critics. This demonstrates just how hard it can be to repair brand reputation damage.

Nike’s wider CSR programme has included changing its outsourcing practices and appointing dedicated CSR personnel as part of a policy to improve the conditions of workers in developing countries.

Nike Inc president and CEO, Mark Parker, says CSR has been a catalyst for growth and innovation. He appreciates that if real change is to occur in its supply chain and contract factories in the communities in which it operates and in the broader world it influences, then big goals are needed to realise big achievements.

As a sports brand, it makes sense for Nike to continue to use the medium as a core CSR vehicle. In fact over the next two years it is investing $315m in grants, product donations and in-kind support to help people to ‘unleash their potential through sport’.

This year it is assisting children in New Orleans to rebuild their communities by providing Nike product, resurfacing old playing fields and funding community-based programmes.

One of the biggest social issues that corporations can help to solve is homelessness and Nike’s CSR strategy includes joining other sponsors such as Goldman Sachs, Macquaries Group, BHP Bilton and the Vodafone Foundation in supporting The Homeless World Cup.

Vodafone is supporting the Homeless World Cup Foundation with a £500,000 start- up package to build the infrastructure for grass roots football in more than 60 nations.

The sixth tournament took place in Melbourne, Australia in December 2008 and was hosted by the magazine Big Issue Australia. It was won by Afghanistan who defeated Russia 5-4 in the final. In the first Women’s Homeless World Cup, Zambia defeated Liberia 7-1 in the final.

The 2009 tournament takes place in Milan, Italy from September 6-13.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

Mel Young, president of the Homeless World Cup, spoke out during the World Economic Forum in Davos earlier this year. He said that in the current economic climate there are huge opportunities for the values of sport, around teamwork and working together to achieve success in adversity, to help give people confidence during difficult times.

All the sponsors of the Homeless World Cup already regard sport as a strategic CSR medium and see the benefits to their brand of helping to reduce the number of homeless people globally. There are an estimated 100m people worldwide without homes (source: United Nations Commission on Human Rights) with 3.5m in the US (Source: Substance Abuse and Mental Health Services Administration).

Some 56 nations took part in Melbourne and research conducted during the tournament revealed that two thirds of spectators had changed their perspective of homeless people and 82% agree the Homeless World Cup breaks down stereotypes.

Some 77% of players involved experienced a significant life change; said they were no-longer using drugs and alcohol, were moving into homes, had jobs, were gaining education and training, repairing relationships and becoming coaches or players with semi-pro teams. Some 94% claim to have a renewed motivation for life.

As part of its support, Nike gave the winners of its Fair Play Award $500 each to spend in one hour at its Collingwood outlet store.

BHP Bilton sees this sporting link as vital to its overall CSR strategy. Its definition of sustainable development is ensuring its business remains viable and contributes lasting benefits to society through the social, environmental, ethical and economic aspects of everything it does.

As part of a two-year funding package around the Homeless World Cup, BHP Bilton is supporting social change by expanding the Street Socceroos Project in Australia. This programme targets some of the country’s most disadvantaged communities in places where the company already has a presence.

Employee Engagement BHP Bilton has identified that there are also employee engagement benefits as local staff are invited to participate in coaching, informal mentoring and all aspects of the game.

Employee engagement can be a big attraction when companies are considering sport when allocating their CSR resources. It can be the best way to get executive board buy-in when planning any activity.

In October 2008 the John Lewis Partnership, the UK employee-owned retailer, launched Partners in Sport. The idea is to enable its 69,000 staff members to take part in sport, live a healthier lifestyle and qualify as coaches. The company awards employees £250 a year to learn a sport or activity.

The programme will run until the London 2012 Olympic Games and is a partnership with Sports Coach UK, a government-backed agency.

John Lewis Partnership chairman Charlie Mayfield says investing in sport and in his staff’s wellbeing is a long-term strategy designed to add value to the business. It is not something which can be halted because of the economic environment. He added

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders that many employees want to give something back to their local community and sport is an effective way for them to achieve this.

Increasingly sponsors and sports rights holders are seeing the benefits of using CSR budgets for their mutual benefit.

For businesses, being involved in helping a sport to flourish and increase participation so that people become more healthy can be extremely effective in engaging various stakeholders, from staff to customers. It can also help to satisfy an often cynical media.

The strategic partnerships agreed through the John Lewis’ Partners in Sport scheme, for instance, include a link with the British Equestrian Programme as part of the wider BOA/FTSE100 initiative.

This scheme partners stock market-quoted companies with national governing bodies so that they can offer support in kind, such as the involvement of employees, rather than traditional financial sponsorship. Other companies involved in the programme include Corus with British Triathlon, British Gas (England Hockey). Land Securities (British Volleyball), Accenture (Royal Yachting Association) and Sainsbury’s (British Table Tennis Federation).

Another global initiative bringing sport and sponsors together through the social responsibility door is Beyond Sport. It was launched last summer by former British Prime Minister Tony Blair with the objective of unearthing the world’s most inspirational sports projects, people and organisations so that others would be inspired.

The idea is to encourage a new mindset in the way sport is seen and utilised as a force for good by government. The Honda Racing F1 Team, through its earthdreams programme was leading the way as the first corporate sponsor before the team hit problems and announced it was looking for a buyer for the team. Other sponsors include Barclays, TIME International and Virgin Atlantic.

The 2009 Beyond Sport Awards has 11 categories covering different sports and rewards projects featuring social responsibility and philanthropy. Tony Blair will choose the winner in each category in July.

Among the governing bodies to praise the concept of Beyond Sport is The Federation Internationale de Natation (FINA), the international body of five major aquatic sports: swimming, water polo, open-water swimming, diving and synchronised swimming. President, Mustapha Larfaoui, says the programme has the same values as FINA which are fair play, education, citizenship, respect, friendship and protection of the environment.

Many big brand sport sponsors are allocating extra funding to support sport on a more socially responsible level because they see it as a way to meet their own CSR objectives and add value.

Coca-Cola, for instance, is heavily involved in the Special Olympics which is the global event for athletes with intellectual disabilities.

The event is now a global movement, with more than 500,000 athletes in China, more than 210,000 in India, almost 550,000 in the United States, 4,400 athletes in Rwanda and more than 600 in Afghanistan.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

The Coca-Cola Company says it shares the values of the Special Olympics, which are understanding, acceptance and inclusion. Being involved in the event by helping the athletes and their families brings the sponsorship to life, it says.

The Special Olympics World Games were held in Ireland in 2003, Japan in 2005 and China in 2007. The 2009, Special Olympic Winter Games took place at Boise, Idaho in February and featured athletes from more than 100 countries.

Another Special Olympics sponsor is US retail giant Wal-Mart which awarded the 2009 event a $1.1m grant through The Wal-Mart Foundation. The donation takes its level of funding for the event to more than $3.7m since 2007.

The 2009 grant was used to launch a ‘Greening the Games’ initiative and reduce the overall carbon footprint of future events. The money went towards green buses, for instance, which operated on ultra low sulphur diesel.

The funding was also used to support a recycling programme at the games, with the target to recycle at least 50% of the materials used, and to source food locally to cut food miles and transport emissions. It is too early to evaluate whether this target was achieved.

Sports CSR programmes are being used to address other problems in society.

Brand owner Diageo is the world’s leading premium alcoholic drinks business and recognises that the issues of alcohol abuse, drink-driving and underage drinking are controversial subjects and require a strategic CSR approach.

Its products are consumed in more than 180 countries on five continents. It employs more than 22,000 people and generates annual revenue of approximately £13bn. Its CSR strategy linked to sport includes using its whisky brand Johnnie Walker’s partnership with the McLaren Mercedes F1 team to raise public awareness of drink driving.

In the UK more than 450 people a year are killed and approximately 1750 seriously injured as a result of drinking and driving (source: Department for Transport). In the European Union drink driving accounts for approximately 25% of all road deaths, according to the European Transport Safety Council.

In December 2008 Formula One World Champion Lewis Hamilton and two times champion Mika Hakkinen paired up to visit more than 20 countries to encourage people not to drink and drive. This was part of the Never Drink and Drive campaign which is central to the Johnnie Walker Formula One sponsorship and part of Diageo’s wider CSR strategy.

In the US, Major League Baseball is proving to be a popular choice among sponsors planning sport-based CSR strategy.

In the final quarter of 2008 KPMG LLP presented another $1m to the Major League Baseball Properties to enhance the Reviving Baseball in Inner Cities (RBI) programme. A similar donation was made in 2007.

The RBI program has a presence in more than 200 cities with educational and life skills elements including a multicultural education component. It completed its 20th season in 2008.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

KPMG chairman Timothy P Flynn says the programme opens the door of opportunity to boys and girls through sport, mentoring and education which is consistent with the firm’s core commitment to serving the communities in which its people live and work.

Elsewhere, the Nikon Group has implemented a social responsibility programme through its sponsorship of the Seattle Mariners. It donated digital cameras to local elementary schools and presented them before matches. Other initiatives have been put in place to enable children to go to baseball games.

Major League Baseball itself is proactive when it comes to CSR. It has an on-going relationship with international relief organisation World Vision. It donates spare MLB- licensed apparel to children and their families in developing countries.

Evaluation And Measurement Of course, to ensure value is added to all sides of a CSR/sports programme any activity must be robustly evaluated and measured.

Brands need to know that there is more value to the sponsor and the cause through a long-term CSR partnership rather than through a one-off charitable donation.

However this is not always an easy thing to ascertain. Marketing and CSR experts suggest measuring any activity against the three metrics of law/standards, value add and core values.

Is the CSR activity legal or does it meet professional standards? How will any activity add value to the brand and the sport over the long-term and how will it be viewed by different stakeholders? Finally, what impact does a CSR programme linked to sport have on an organisation’s core values? What effect will it have on how employees view any activity, for instance? Staff need to be engaged for any programme to work effectively.

Ardi Kolah, a global marketing and brand partnership consultant, suggests companies can apply the London Benchmark Group (LBG) Model when assessing the success of community-based CSR brand involvement.

The London Benchmarking Group (LBG) is a collection of more than 100 companies working together to measure Corporate Community Investment (CCI), something which he says should be part of any CSR strategy.

CCI is how a company shares its resources with the wider community to make a positive difference. This might include fundraising events or donating the skills and time of its employees.

The LBG model provides a comprehensive and consistent set of measures to determine a company's contribution to the community, including cash, time and in- kind donations, as well as management costs. The model also captures the outputs and longer-term impacts of CCI projects on society and the business itself.

Since 1994, members of LBG have shared best practice. There are now LBG centres around the world including in Australia, Canada, the Czech Republic, Germany and the US. Members include multinationals such as HSBC, Vodafone and Unilever, as well as major UK companies such as Marks & Spencer and BSkyB.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

The starting point for measurement is to identify three major brand motivations:

1. Is the company clear about its sense of moral and social responsibility?

2. Is there a belief within the business that it has a long-term interest in fostering a healthy community?

3. Is there internal knowledge that CSR can have a direct benefit on the business?

One brand owner to use the LBG theory to evaluate its extensive CSR activities linked to sport is The Kellogg Co which released its first global CSR report in January 2009 focusing on four key areas, environment, marketplace, workplace and community.

The model helped Kellogg’s to:

 Identify relevant stakeholders

 Make CSR part of its marketing strategy

 Identify a suitable sports governing body to work with that the company could trust

 Replace a large number of long-term small projects with a credible programme that has since engaged employees, consumers and opinion formers.

Sports such as running, walking and cycling were researched and considered by the company but it was decided that in Britain it would get more value from linking with the Amateur Swimming Association.

Kellogg’s has a long history of supporting community sports causes which link its cereals with enjoying a healthy lifestyle. It has sponsored the Amateur Swimming Association awards for more than 10 years and is supporting a team of young British swimmers in the run up to London 2012. The latest three-year deal with the ASA, worth £3m to the sport, ends in 2009 but should be extended.

There is visible branding for Kellogg’s on 1.8 million award certificates each year and its cereal packs outline the company’s relationship with the ASA and emphasise the benefits of swimming. The sponsor has also helped develop easier access to swimming facilities by supporting single-sex swimming sessions for Sikh women, for example.

Kellogg’s added value benefit extends to helping its employees feel good about its sponsorships which boosts morale and can be an important factor in recruiting and retaining talent.

Employees are encouraged to participate in swimming activities to help combat staff obesity issues. Meanwhile, the company’s Occupational Health and Corporate Responsibility teams have joined forces with local leisure and health facilities and clubs to launch a Fit for Life scheme for staff to improve their lifestyle through sport. The scheme includes access to gyms and 15-minute voluntary and confidential check-ups.

The company was also a legacy partner of the World Swimming Championships in Manchester in 2008 when its sponsorship included helping 50 local people become trained as swimming coaches. There is also the Kellogg’s Active Living Fund to help 38

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders community organisations run sports projects that get people active and new funding was made available in January 2009.

The company is also seeing the benefit of linking with sport in the US.

Here, its Frosted Flakes brand has partnerships with the Little League International, American Youth Soccer Organization and Girls on the Run International. It supports a Youth Achievement Award to celebrate children who work hard playing their favourite sports.

Any measurement designed to judge the impact of any CSR/sport activity needs to assess what ultimately the effect is on sales. This means assessing what difference a programme is making to all stakeholders, whether they are customers, employees, suppliers, the community, governments or the environment.

In the UK, the business membership organisation Business in the Community has its own measurement tools. It had an Environmental Index in 1996 and developed a Community Index in 2002 when member companies requested a mechanism to benchmark their other activities. This index assesses a company’s impact on the community, marketplace, and workplace through their operations, products and interactions with stakeholders.

It also helps companies understand how they compare against other organisations and includes FTSE100 and FTSE250 companies as well as firms that are not listed.

It also includes sector leaders from the Dow Jones Sustainability Index in the US.

Case Study: Nike And GameChangers

Background Nike contributes more than $100m in cash and products to non-profit partners around the world as part of its Let Me Play CSR/sport programme. The company is a supporter of the United Nations Millennium Goals, whose objectives include empowering girls and women. Nike sees sport as a way to do this and has partnered with the non-profit support system for social entrepreneurs called Ashoka Changemakers in a programme called GameChangers. This is an online competition designed to focus attention on the challenges women in sport face today and to identify the most innovative solutions to them

Objectives The aim is to identify, inspire and bring together the next wave of women innovators who are eager to change the game for women in sport. It is, for example, pushing the inclusion of long distance women’s running events in the Olympics and advancing the power of sport to change women’s and girls’ lives. Ultimately, it wants to use sport to improve communities, accelerate development and drive social change for girls and women.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

Implementation The deadline for entries to the latest GameChangers collaborative competition was February 11 2009. Entrants had to demonstrate innovation, social impact and sustainability for the chance to win $5,000 to support their work. All entries from charities, private companies and public entities had to reflect the theme of Change the Game for Women in Sport. They will be published on the GameChangers website. Early entry winners and prizes have been announced to increase media exposure for the various initiatives.

Employee Engagement And Participation Employees at Nike stores are encouraged to highlight the GameChangers programme while staff involvement has included travelling to Uganda to teach girls how to play football.

Results Nike and Ashoka have seen interest in the competition grow and through its early entry winners scheme it is evident that the scheme is making a difference.

A number of sports-related CSR initiatives have been highlighted. These include the first sports for social change in a Palestinian refugee camp providing a safe space for girls and women to be empowered through sport.

One initiative is encouraging girls who are playing football around the world to purchase balls hand-stitched by poor and widowed women in Afghanistan.

On-Going Activity And Longevity This relationship is proving mutually beneficial to Nike and to Ashoka. It has the potential to be a long-term programme that can make a real difference to the lives of women through sport. Ashoka has established programmes in more than 60 countries and employs about 150 staff in 25 regional offices who are being continually engaged by the programme.

Case Study: Standard Chartered Bank And Race For The Living Planet

Background In 2004, Standard Chartered created The Greatest Race on Earth (GROE), a challenging virtual relay race across four established marathons in Nairobi, Singapore, Mumbai and Hong Kong. These locations represent some of the most challenging urban running environments in the world. The marathons characterise the values and attitude that Standard Chartered tries to live by everyday. These are: a can-do attitude, a priority on strength of trust, willpower, stamina, and the determination to go the distance in business. GROE is the world’s only marathon series and team event, and offers one of the biggest prize pools in world athletics – US$ 1m. The bank partners with the sight charity Seeing is Believing to tackle avoidable blindness.

CSR & Sports Sponsorship How CSR Sports Programmes Add Value To Sponsors And Rights Holders

Objectives The creation of GROE has revolutionised the traditionally individual sport of marathon running by shifting the focus more towards co-operation and collaboration. Partnership and teamwork are also Standard Chartered core values. Another aim is to raise money for Seeing Is Believing.

Implementation The Greatest Race on Earth is open to teams of four runners. Each person runs one of the four marathons in Nairobi, Singapore, Mumbai and Hong Kong. The teams with the fastest aggregate time get a chance to share a prize pool of US$1 million.

Standard Chartered’s group brand development manager on Race For The Living Planet, Simon Mould, says the company would not have taken on the sponsorship unless it could involve local people through community events. At each location there are shorter races that people can take part in such as half marathons, 10k distance races, a 6k dream run and a wheel chair run.

Employee Engagement And Participation Employees of Standards Chartered are taking part in The Greatest Race on Earth Staff Half Marathon Challenge. Each team will run one half marathon in Nairobi, Singapore, Mumbai and Hong Kong.

Results The partnership between Seeing is Believing, Standard Chartered and the International Agency for Prevention of Blindness has to date raised more than $17m for blindness initiatives. This is making a difference to the lives of 10 million people. Local community races around the marathons are encouraging people to get involved in supporting the sport as well as getting fit themselves.

On-Going Activity And Longevity The partnership plans to invest a further $20m by 2012 to provide sustainable eye services for 20 million people in the most disadvantaged areas of 20 cities around the globe. As a bank, the economic downturn means Standard Chartered will review its involvement at the end of the year but it is confident it will continue the initiative next year.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

SECTION THREE. THE ROLE OF THE RIGHTS HOLDER IN CSR

This section considers how rights holders can, and why they should, tap into brands’ increasing desire to work with sport when planning CSR programmes

Sponsors are now looking at sport in the same way that, for years, they considered the arts and the environment when allocating their CSR budgets, and rights holders are noticing.

This trend is expected to accelerate as sponsors realise just how many people they can reach and engage with across the social and demographic spectrum through sport.

Rights Owners And Existing Community CSR Programmes

Of course, many rights owners already have successful community projects in place as part of their own CSR strategies. These programmes are improving their own sports’ economic viability.

Governing bodies are savvy enough to know that supporting the community creates a positive image among local people where the next generation of fans are to be found.

In the UK, the FA Premier League has set itself and its member clubs strong CSR goals with a number of initiatives.

Its ‘Creating Chances’ programme, launched in 2007 supports more than 400 community good causes. These have benefited from professional players getting involved or from a £2,000 cash donation from the Premier League.

Accountants Deloitte estimate that approximately £122 million was invested in community projects in the 2007/08 season, a 50 per cent increase on the previous figure published in 2003.

Where the money went:  £73m in clubs’ community investment  £48.85m is the Premier League Community Contribution which incorporates, £15m for the Football Foundation, £4.0m for Football League Community Development and £5.4m for Football League Youth Development.

The Premier League is also working with the British government on a £3.8m partnership to help youngsters get involved in different Olympic sports as the country begins the countdown to London 2012.

The Premier League 4 Sport programme has the support of UK Prime Minister Gordon Brown and aims to get the 20 clubs to encourage young people to play badminton, table tennis, judo and volleyball.

Each Premier League club is linked to four community sport clubs in its local area. These 80 community sport clubs link to four secondary schools to create a total of 42

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

320 satellite clubs. The Premier League clubs all have a project co-ordinator to manage the scheme locally and to work with clubs and school sport departments to maximise opportunities for young people.

The Government sees this as a way for the professional clubs to help youngsters perform five hours of sport per week. The Youth Sport Trust and Sport England are also involved in the plan to get as up to 25,000 11-16 year olds playing more sport.

This programme should be good news for the governing body for badminton, Badminton England, which decided to be more proactive in its search for sponsorship and additional revenue.

It appointed the marketing agency Generate Sponsorship in November 2008 to try to maximise funding for the European Badminton Championships which take place in England in 2009 and 2010. In addition, the World Championships are held in London in 2011 with the Olympics in the city a year later.

Badminton should be a much more popular sport for brands looking for different ways to spend their CSR budgets because there is such a high participation in schools and in community sports centres.

A survey by the Sports Industry Research Centre at Sheffield Hallam University confirms that Badminton is the nation’s number one racket sport. Approximately three million people play the sport each year, which is 8.6% of the population. Nearly one million adults play once a month and 500,000 children play at least 10 times a year out of school.

Table 3.1. The Adult Population of England’s Participation In Badminton Type Number Percent

Regular players (at least once every 4 wks) 926,000 2.25%

Occasional players (at least once per year) 1,830,000 4.45%

Non- badminton players 38,460,000 93.30%

Total 41,216,000 100.00% Source: Sports Industry Research Centre 2008

Table 3.2. Frequency Of Participation In Badminton In England Frequency Active Taking Part GHS 2002 People 2005/06 2005/06

At least once in the last year n/a 6.7% 6.4%

At least once in the last 4 weeks 2.2% 2.9% 1.8%

At least 4 times in the last 4 weeks 1.3% 1.6% 1%

At least 12 times in the last 4 weeks 0.1% 0.1% <0.5% Source: Sports Industry Research Centre 2008

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Table 3.3. Summary Of Total Badminton Players In England

Category 0-6 Years Y2-Y11 Adults Total Regular players Unknown 0.58 0.93 1.51 Occasional players Unknown 1.05 1.83 2.88 Any players Unknown 1.63 2.76 4.39 Source: Sports Industry Research Centre 2008

One sport which is not so easy to participate in, but which is increasing its CSR activities, is professional sailing.

Team Aqua, which competes internationally at the top level, decided to promote ecological sustainability throughout its 2008 campaign by hoisting World Land Trust (WLT) sails.

The WLT is an international conservation organisation which takes direct action to save the rainforests. Team Aqua also wanted its sailing campaign to be carbon neutral as part of its WLT partnership. The initiative has been spearheaded by the owner of Team Aqua, Chris Bake, who has personally supported WLT for many years.

Across the Atlantic, The National Football League (NFL) also has a clear vision of its social responsibilities.

Its Play 60 programme was launched in 2007 to raise awareness of childhood obesity and hopefully reverse the trend. There are now more than 25 Youth Fitness Zones based in local communities across America.

The NFL has committed $100m to youth health and fitness programmes since the start of the campaign. In November 2008, well-known players including Calvin Johnson (Detroit Lions) and Donovan McNabb (Philadelphia Eagles) broadcast 90- second public service announcements during matches held over the Thanksgiving weekend.

Understanding the role of CSR is nothing new to the NFL. Since 1999, teams have been involved in hands-one community service projects known as Hometown Huddle.

Local events take place each October and there are year-round activities working with United Ways, the national non-profit organisation which identifies and resolves community issues.

The Hometown Huddle campaign persuaded the Washington Redskins to create an iGym at a Virginia YMCA to help people to get fit whilst playing computer games.

Elsewhere, the New Orleans Saints helped United Way install a Youth Fitness Zone at Lakeview Playground in the Greater New Orleans area for 5-12 year olds, while the Detroit Lions were involved in building a fitness trail for boys and girls in South East Michigan.

Many children who struggle at school can learn literacy and numeracy skills through community schemes linked to sport.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

The NFL and the Premier League are also helping children who struggle at school to learn literacy and numeracy skills.

The NFL’s Youth Education Town initiative donates more than $1million annually to the project, which has centres in ten cities across the US.

The FA Premier League clubs, meanwhile, operate Learning Centres with classrooms based at football grounds and these are run in partnership with the government.

The scheme offers children the chance to receive after-school literacy, numeracy and IT support. The scheme has grown beyond the big Premiership clubs with many smaller professional and semi-professional teams involved in educational support to existing, potential and next generation supporters.

Again, this is about the rights holders demonstrating that they are engaged with their communities. This can be a spur to encouraging more commercial sponsors to get involved too.

Boosting Sports Funding

Accessing money contained within CSR budgets could certainly boost the funds of many sports.

Sponsors looking for CSR ideas can achieve their goals by getting more closely involved with rights holders and community sports projects.

Sport England, which hands out National Lottery cash, has a set of key targets between 2009 and 2013 which individual sports are helping it to meet.

The targets are:

 To have one million people playing more sport  Cutting the drop-off in at least five different sports by 25%  Increasing people’s satisfaction with their experience of sport  Improving talent development in at least 25 sports  Making a major contribution to the delivery of the Five Hours Sport Offer. This is an attempt to get 5-16 year olds to participate in at least five hours of sport each week

Sport England insists that the public funding for community sport from the public purse and from the National Lottery has increased by more than 50% since 1997 to more than £620 million a year. In 1997 it was £413m.

In addition, local authorities are expected to spend more than £1bn on sports facilities and development over the next three years. In February 2009, Sport England unveiled a £10 million investment fund to create sporting opportunities for people in rural areas.

More than half of local authority areas (80 out of 150) in England have plans to increase sports participation. School sport should also benefit. Between 2003-2008, the government invested £1.5 billion in school sport with another £750 million expected to be spent between 2008-2011.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Table 3.4. Sport England Funding For 2009-2013 Angling £1,561,906 Modern Pentathlon £886,496 Archery £857,989 Mountaineering £1,287,850 Athletics £20,447,169 Movement & Dance £741,552 Badminton £20,800,000 Netball £17,300,000 Baseball & Softball £2,700,000 Orienteering £2,275,000 Basketball £8,200,000 Rounders £2,200,000 Basketball (Wheelchair) £727,683 Rowing £9,100,000 Boccia £816,041 Rugby (Wheelchair) £480,000 Bowls £756,750 Rugby League £29,408,341 Boxing £4,700,000 Rugby Union £30,724,908 Canoeing £8,470,577 Sailing £9,619,542 Cricket £37,776,725 Shooting £750,000 Cycling £24,288,000 Snowsport £985,000 Equestrian £4,268,002 Squash £12,600,000 Fencing £1,041,413 Swimming £20,875,000 Football £25,635,000 Table Tennis £9,301,404 Goalball £354,000 Taekwondo £750,000 Golf £12,851,500 Tennis £26,800,000 Gymnastics £11,388,481 Triathlon £4,700,000 Handball £645,300 Volleyball £5,600,000 Hockey £11,511,000 Waterskiing £951,373 Judo £10,242,001 Weightlifting £609,094 Lacrosse £2,210,993 Wrestling £331,824 Sub total £400,527,914 Football Foundation £60,000,000 Coaches for more than one sport £7,500,000 Better governance £3,150,000 Coaching bursaries £1,300,000 Coaching network £7,500,000 Total £479,977,914 Source: Department for Culture Media and Sport

One sport to benefit from Lottery funding, and which is now attracting a sponsor’s interest from a CSR perspective, is elite cycling.

It could be argued that Great Britain’s cycling success at the 2008 Summer Olympic Games has also helped to bring in more CSR-related sponsorship because sponsors see benefits of being involved with such a successful sport.

In the summer of 2008 broadcaster Sky signed a £40 million, five-year deal with governing body British Cycling to boost the sport at all levels.

Sky comes on board at a time when cycling is enjoying some of its most successful years and is generating record levels of public interest. According to a survey by UK Sport published in January 2009, cycling is now the UK’s third most popular Olympic sport following Team GB’s performance in the 2008 Olympics and Paralympics.

The UK Sport Sporting Preference survey of more than 2,000 members of the public revealed that since Beijing, twice as many people want success in cycling as prior to the Games. Only athletics and swimming have more public support. In addition, 80%

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR of those surveyed said cyclists, such as gold medallist Chris Hoy, were good role models for children.

As well as putting additional funding into the Elite Team of world, Olympic and Paralympic cyclists, Sky is supporting British Cycling’s talent development programmes and grass roots initiatives in schools and local communities

British Cycling’s president Brian Cookson described the Sky deal as an opportunity to “transform the sport” as well as inspiring millions of Britons to get fit. Sky is also the sponsor of the London Freewheel cycling event around the Capital each September. A major benefit for Sky is that it has provided a vehicle to promote its HD brand with the launch last autumn of the Sky HD Trade Team.

The team, which includes Olympic hero Chris Hoy, wears Sky HD branded kit. Sky is convinced it has found the perfect brand link, matching its high definition HD service with the cycling team’s high quality performance.

Away from cycling, Sky Sports has developed the Living For Sport initiative with the Youth Sports Trust. The scheme uses sport as a way to motivate and inspire young people who are disengaged with school. It has so far reached more than 17,000 children in 600 schools.

Sports Must Reassure Sponsors That They Are Socially Responsible There is no doubt that organisations with CSR budgets to spend are being swayed by the positive benefits of being involved in sport. However the rights holders they want to work with must be transparent themselves. They are being asked to answer sometimes awkward and difficult questions about whether they and their athletes are as socially responsible as they could be.

Potential sponsors are looking deeper for any inconsistencies which could damage their own brand’s claims to be socially responsible and invite unwanted criticism from stakeholders, including an often cynical media.

For example, rights owners must reassure sponsors about what actions are being taken against drugs or corruption in the sport.

Rights owners might also need to show that they have a strategy in place to encourage diversity.

In addition, does the sport really interact with society or is it operating from something of a distance? Is the image of fair play on the field translated into how the sport is administered so that staff, participants and spectators are treated fairly? And how does a sport look after the welfare of its former players?

Companies such as Sky have had to make a call on whether their own brand could be tarnished by the major drugs scandals to rock professional cycling in recent years.

Cycling must constantly demonstrate that it is policing the potential use of performance enhancing drugs. This is becoming increasingly difficult because of the sophisticated techniques used to mask illegal substances.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Tour de France Doping Scandals

In the most controversial scandal since the 1998 Tour, thirteen riders were expelled from the 2006 Tour de France stemming from a Spanish doping scandal, on the eve of Strasbourg prologue to the 93rd edition.

T-Mobile had been principle sponsor of one of the major teams since 1991 and its rider, Jan Ullrich, one of the favourites to win the race, was among those excluded from the Tour. Another T-Mobile rider, Oscar Sevilla, was also expelled, leaving the team starting with only seven riders.

Phonak team member Floyd Landis won the 2006 Tour de France but was stripped of the title when he was found to have used a banned performance enhancing drug.

After the 2006 season, the T- Mobile team changed its manager, and in an effort to present a new, drug-free image, brought a young group of riders to the 2007 Tour de France. The team also introduced what was thought to be one of the strictest anti- doping programmes. Despite this, team member Patrik Sinkewitz tested positive for elevated testosterone during a pre-Tour de France training camp. Sinkewitz, who was fired, testified that doping was widespread at the team, both before and after Jan Ullrich was its main star.

The initial response from T-Mobile was to withdraw its €1-million-sponsorship from German TV coverage of the Tour de France. The company had paid to have its name appear on the public TV channels ARD and ZDF during the race. The broadcasters also cancelled their coverage of the race midway through the competition. ARD in particular was placed in a difficult position as a team sponsor.

Peter Kaadtmann, the ARD and ZDF team chief at the Tour, was quoted as saying that "Our contract stated that we broadcast the Tour as a competition of clean riders, not of people using doping substances."

T-Mobile announced that it would invest instead in drug testing.

At the end of the 2007 season, however, the company withdrew from cycling sponsorship completely citing doping scandals as its reason.

The decision precipitated a similar move from another major sponsor of the team, Audi:

"The withdrawal of Deutsche Telekom means we've lost the major partner and the basis of our involvement," Audi spokeswoman Iris Altig said. "We will not continue our involvement next year."

Sporting goods company Adidas also dropped its sponsorship deal with the team.

The team had, therefore, lost its three biggest backers in a short period. All were major corporations operating on a global basis. They simply couldn’t afford to have their names tarnished by a sports association that was beyond their control. Damage limitation exercises were clearly not sufficient for either the sponsors or the broadcasters ARD and ZDF, both of which have now pulled out of covering the Tour de France permanently.

Some critics argue that the sport is beyond repair. In recent years Denmark’s Michael Rasmussen and Kazakhstan’s Alexander Vinokourov have been other big name riders to suffer bans for drug violations.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Yet in January 2009 the Australian anti-doping expert Robin Parisotto, who sits on the panel that analyses blood tests for the Union Cycliste International (UCI), came to cycling’s defence. He says cycling is actually pioneering the fight against drugs in sport.

Sponsors align themselves with sport primarily to gain from the attributes that sport offers. Companies such as T-Mobile, Adidas and Audi, do not need to generate brand awareness but, like Sky, they are seeking a positive promotional platform to develop their brands. If cycling cannot provide such a platform, there are many other sports seeking sponsorship investment that can.

Chart 3.1. European Cycling Sponsorship by Number of Deals 2007

Number of Deals

FMCG 17%

Financial Services 15% Telecommunications 9%

Gambling 7% Automotive Retail 6%

Retail 4% Other 43%

0% 10% 20% 30% 40% 50%

Source: Driving Business Through Sport, International Marketing Reports

Major cycling teams are funded almost exclusively through sponsorship. Chart 3.1 shows the sponsorship deal breakdown of European professional cycling. The three leading sectors in the chart are all highly sensitive of their image. Arguably the financial services companies more so that ever. They certainly can’t be seen to be throwing money at a sport that is perceived as a haven for cheats. Quite simply for the major cycling tours to survive, it requires that the riders become drug-free and are seen to be drug free.

Issues Affecting The NFL In the US, the NFL’s (National Football League) work to help reduce obesity levels is being applauded, but questions are being asked about its wider sponsorship agreements and how they support this CSR strategy.

Its choice of main brand sponsors could be regarded by some as sending out mixed messages to its fans, especially overweight teenagers.

The NFL remains a premier advertising and marketing platform for targeting men in the US. This is why, in 2005, Coors Brewing Co. signed a $500m five-year deal.

Burger King ended its sponsorship after the 2007/2008 season but in December 2008 Kentucky Fried Chicken became the NFL’s first official wing sponsor of the NFL playoffs and Super Bowl. This is KFC’s first official NFL sponsorship. The National

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Chicken Council estimates that during a Super Bowl weekend, 720 million wings are eaten – that’s two for every person in the country. The NFL’s efforts to be seen as socially responsible have also come under attack from the drugs lobby. There have been numerous reports and rumours of NFL players using diuretics to mask steroid use. However, many fans appear disinterested in such stories or assume drug taking has been the norm for years.

Research by The San Diego Union-Tribune discovered that 52 former Pro Bowl players (Pro Bowl is the all-star game played at the end of the season after the Super Bowl) with links to drugs, plus 133 others in the NFL dating back to 1962. Some were caught or admitted drug taking, yet there have been few public calls for their playing records to be amended.

Gambling Sponsorship, Sport And CSR

The question of inconsistencies around CSR has extended to the relationship many rights owners have with gambling brands.

A number of sports clubs are sponsored by gambling companies and campaigners insist that this is potentially as socially damaging as being sponsored by tobacco or alcohol brands.

The reality is that gambling and sport have always been uncomfortable bed fellows. Many British sports and sports infrastructure have benefited considerably from funding from the National Lottery, for example, which is a game of chance.

Yet it is the shirt sponsorships agreed by some of the country’s leading football teams which have raised the most concern. It is illegal in Britain for gambling operators to target children with advertising. However, gambling brands are accused of bending the rules by advertising on the shirts seen and bought by millions of children and their parents every week.

Critics of these deals argue that the football clubs do not need to link with gambling brands and that the money made available from TV deals, even during the recession, means they should be more socially responsible and refrain from carrying shirt advertising from betting companies.

The Government has called on the Premier League to commit to supporting the sport at all levels should it secure the improved deal in the current economic climate.

The clubs themselves are adamant that their current CSR activity in local communities demonstrates that this is a particular box that they are already ticking.

Yet despite all the sport’s obvious good work, the link with the gambling industry still raises concerns. Those campaigning for socially responsible gambling are worried about the potential for people to gamble via the internet or mobile phone.

This has been one of the largest cultural shifts in the world of gambling in recent years as betting activity is no longer restricted to adult-only environments such as bingo halls, casinos and betting shops. The growth in internet betting has increased the gambling industry’s investment in other sports, such as cricket. Five English county teams now have such partners.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

One of the world’s leading experts on socially-responsible gambling is Professor Mark Griffiths from the School of Social Sciences at Nottingham Trent University.

He says the names of gambling firms should not be on replica shirts being bought by under 18s. Whilst adults can make an informed choice, football and gambling just do not mix when it comes to child supporters.

Griffiths says: “Sport must address its link with gambling sponsors and stop some young football fans becoming walking billboards for gambling websites when they wear their favourite team’s replica shirt.”

Griffiths adds that one of the most important areas of the gaming industry’s own CSR strategy is the protection of vulnerable players. The link with football clubs would appear to some people to go against this.

He points out that gambling among young people often goes hand in hand with other addictive activities such as drug taking and alcohol abuse which has been linked to juvenile crime. These are social causes that ironically the many football clubs’ commendable community programmes are addressing so well.

Adolescent gambling is a problem across the world and is related to other delinquent behaviours. In the UK, a number of studies have consistently highlighted a figure of up to 5-6% level of pathological gamblers among adolescent fruit machine gamblers. This figure is at least two to three times higher than that identified in adult populations and overall, research into adolescent gambling behaviour shows that more than 70% have gambled at some stage before the age of 15.

Table 3.5. Lifetime Participation In Gambling Activities - 12-15 Year Olds Gambling Activity Participation

Fruit machines 54%

Placing a private bet for money (e.g., with friends) 37%

Scratchcards 28%

Lotto (the bi-weekly National Lottery draw) 16%

Bingo 15%

Betting shops 13%

Any other National Lottery games (e.g., Thunderball) 9%

National Lottery Instant Win games on the Internet 3%

None of the above 26%

Have ever gambled 73% Source: Mori/ International Gaming Research Unit, Nottingham Trent University 2006 In the US an estimated 750,000 teenagers and young adults are problem gamblers, according to researchers at the University at Buffalo’s Research Institute on Addictions. Problem gambling is defined as gambling more than you intended or stealing money to gamble. British football clubs are making efforts to soften the criticism coming their way.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Manchester United’s CSR strategy includes plenty of local community activity and it is a global charity partner with UNICEF. Before linking with troubled insurance group AIG in a £56.5m deal in 2007, it had talks with Gibralter-based betting group Mansion about a potential £70m shirt sponsorship but that collapsed. There was speculation that the club was unhappy with the idea of having such a high profile link to a gambling sponsor. Despite this, Manchester United, in common with most other major clubs, has a partnership with online gambler Betfred and a ‘Betting & Gaming’ link on its website.

Mansion quickly turned its attention to London and eventually signed a four-year, £34m deal with Tottenham Hotspur. However the two parties tried to pre-empt criticism about the team promoting gambling by deciding not to display the Mansion website address on the shirts.

The sponsorship also includes £1.5m to support Tottenham’s community schemes. The Tottenham Foundation has charitable status and uses football to create sporting opportunities in the community, to recognise the achievement of local people, support disabled people and promote healthy living.

Sunderland AFC has a £10m, four-year contract in place with Ireland’s largest independent bookmaker Boylesports. Like most of its rivals Sunderland, is also proactive in its local community. The SAFC Foundation helps to improve motivation, educational attainment and personal skills of young people in the region.

Meanwhile, West Ham United replaced its £7.5m sponsorship with XL Leisure which went bust in September 2008, with a deal in December with online bookmakers SBOBET. The logo was first seen on Hammers shirts in a match against Tottenham. Again, to ease criticism, the club pointed out that the deal will ensure increased exposure to the Bobby Moore Fund for Cancer Research UK. The charity’s logo appears on the club’s academy and junior sides.

One English club to move away from having gambling brands on its shirts is Aston Villa. It had a two-year sponsorship with online casino and poker brand 32Red from the 2006/07 season. For the 2008/09 season, however, it started what could become a new trend for clubs when it put the name of the Acorn Children’s Hospice on its shirts. The club has supported the hospice since 2006. On mainland Europe there have been a number of high profile fights between offshore internet gambling groups and regulators to stop shirt sponsorships.

The French authorities are much tougher over football clubs signing deals with gambling sponsors than the British. All gaming companies must have a special licence to advertise on sports shirts.

Nantes was forced to remove Gamebookers from its shirts and Toulouse had to blank out 888.com, a past sponsor of Middlesbrough in England’s FA Premier League, and replace it with three question marks.

In Germany, the courts told Werder Bremen and 1860 Munich when they signed up with another Gibralter-based online gaming entertainment brand Bwin that the brand’s logos could not appear on the shirts at home games.

Bwin has been more successful in Italy where it is now three years into a four-year deal with AC Milan. The gambling brand’s public relations machine went into over- drive when the club signed the former England captain and recognised children’s role model David Beckham at the end of last year. Bwin has also been a shirt sponsor of

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR another of Beckham’s former clubs, Real Madrid since the start of the 2007/08 season.

How Gambling Brands, CSR And Sport Answer The Critics

Case Study - Betfair And Sportsaid

Background Betfair is the world’s leading online betting exchange, processing up to five million transactions a day and more then 300 bets a second. The company was launched in 2000, is privately-owned and has annual revenues of more than £230m. The company is aware of the potential controversy around gambling and sport and is committed to supporting sport at all levels as well as a wide range of charitable causes. It had previously had two ‘Charity of the Year’ partnerships with Racing Welfare (2005) and The Brooke (2006). At the end of 2006 following a pitch process, SportsAid was chosen to create value for both organisations and support British talent. SportsAid was founded in 1976 to raise funds from the private sector to help amateur sportsmen and sportswomen.

Objectives The SportsAid ‘Charity of the Year’ partnership is a core part of Betfair’s comprehensive Corporate Social Responsibility strategy. The main objective is to create a mutually-beneficial relationship based on true and genuine engagement.

Related objectives include:

 Creating a legacy based on a shared vision to achieve sustainability  Employee engagement and participation with the major emphasis on how to engage internal stakeholders  Innovation by taking a fresh approach to charity partnerships and bringing the dynamic, innovative spirit of Betfair to work in this area.  Leverage opportunities to promote the charity partnerships to aid communication and achieve credibility.

Implementation A strategy was planned around fundraising targets and stakeholder engagement. Betfair became the official ‘Development Partner of University Team GB’. This saw part of the funds from its partnership with SportsAid going directly to supporting University Team GB.

Team GBR is the international student team which represents Great Britain at the World University Summer & Winter Games every two years and at individual sport University World Championships in the alternate years. Many of the athletes competing in these competitions will go on to compete at future Olympic Games, as the likes of Steve Backley, James Cracknell and Beth Tweedle have done in the past. The team is managed and run by British University Sports Association (BUSA) and is populated by an increasing proportion of athletes from the Talented Athlete Scholarship Scheme (TASS), administered by SportsAid.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

There was an initial event at Betfair’s offices to set the tone of the partnership. It was attended by SportsAid CEO Tim Lawler. Sports Minister, Richard Caborn MP, announced the partnership at a Commons Reception to mark SportsAid 30th Anniversary.

Employee engagement and participation through direct fundraising and volunteering was important to Betfair. There was a ‘beat the bosses’ staff fundraising competition to raise as much money as possible for SportsAid. Fourteen teams from across the business raised more than £6,000 in a range of innovative ways.

There was also a focus on employees volunteering to get directly involved at SportsAid events from swimming championships to black tie events. Since 2007, Betfair employees have run the London marathon for SportsAid. Communication of any activity is crucial, and Olympian Steve Backley has become the partnership ambassador.

Fundraising There was a link with SportsAid’s National Lunch Club series with Betfair agreeing to match pound for pound everything raised for SportsAid at the events. Two annual SportsAid quizzes have raised more than £60,000.

There has also been a 120m Race in London’s Trafalgar Square in which Olympians including Backley and Iwan Thomas took part to win cash for SportsAid. The aim was to generate awareness of the work of SportsAid and its association with Betfair ahead of the Olympics.

The Olympics provided a great opportunity for Betfair to do some tailored communication about its Charity of the Year, linking its marketing activity to the work of SportsAid. For example, the SportsAid logo was featured prominently on the main Betfair website during the Games.

Visuals Creating composite branding between two organisations with strong identities was important. There were co-branded pop-ups and backdrops at all events, specific logos (for example a joint SportsAid-Betfair ‘Backing Britain’s Athletes’ logo used during the Olympics), a branded Team University GBR blog site, a large cheque for PR purposes, as well as general marketing.

Leverage Cash 4 Clubs (www.cash-4-clubs.co.uk) is a new scheme to help community sports clubs throughout the country raise vital funds. Betfair is giving clubs a chance to raise the money they need to improve facilities, purchase new equipment, improve coaching staff qualifications and nurture young talent. This has evolved as a way to leverage the SportsAid partnership and is linked to Betfair’s vision to be a champion of regional sport.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Results

The partnership has delivered on its objectives. The fundraising targets were met in both 2007 and 2008, resulting in £250,000 being donated directly by Betfair. Employee awareness and engagement was encouraging given that this was a new initiative for the business, particularly in the field of volunteering which is now a core component of Betfair’s CSR strategy.

On-Going Activity And Longevity

Betfair says SportsAid will continue to play a vital role in its Cash for Clubs programme ensuring the sustainability of the initiative to support community sports clubs around the country. The Sports Quiz has also proved so popular that Betfair has added it to its permanent list of events, thereby creating a legacy from the partnership.

Public Sector Funding To Boost CSR Activities

The smart sports clubs, both professional and amateur, are looking beyond the private sponsorship sector and realising that money is available from alternative sources such as the police and health organisations.

This is an area rights holders have been slow to exploit before but it is an appealing route for additional funding at a time when traditional sports marketing budgets are under pressure because of the economic downturn.

By attracting public money to get community projects based around sport off the ground, sports rights holders hope it will persuade more private brand sponsors with CSR budgets to get involved.

Some sports have earned themselves a reputation for helping to change antisocial behaviour in local communities. Amateur boxing, an Olympic sport, is thriving in deprived areas. Liverpool City Council employs a full-time boxing development officer, for example.

The Amateur Boxing Association of England (ABAE) has helped to set up more than 60 police community boxing clubs across England and Wales. The clubs are run by police officers and volunteers and have also been part-funded by a publishing initiative which has seen educational books covering topics such as bullying, truancy, gangs, knives and substance abuse.

Companies pay to sponsor and brand the booklets. Not all the children take part in contact boxing. The police clubs also encourage children to use punchbags, hand- pad boxing and shadow boxing.

The sport demonstrated its impact on young people at the Athens Olympic Games in 2004 when 17-year old Amir Khan took home a silver medal. Within a year, Sport England had increased the ABAE’s annual funding from £42,000 to £540,000.

This has enabled the ABAE to put in place development officers, a regional coaching structure and better administration. The sport was boosted by a £5 million grant from

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

UK Sport, which funds elite sports, for the 2008 Beijing Summer Olympic Games and the team won one gold medal and two bronze medals for boxing.

Like boxing, rugby union is also working closely with local communities and public bodies.

In South Wales the police and Ospreys rugby union team have teamed up to tackle youth offending. More than 100 Police Community Support Officers and youth workers are qualifying as rugby coaches as part of the Ospreys Community Engagement Project launched in March 2008. The emphasis is on the ethos of rugby itself, promoting teamwork, responsibility and respect, all of which are also important in everyday life.

Ospreys commercial sponsors include Land Rover, John West and Fujitsu and they benefit by being associated with such a positive CSR programme.

Meanwhile, in January 2009, Hull FC rugby league club revealed it is working with its local National Health Service Trust to relocate its training ground and create a health and lifestyle centre in the city. Health bosses have agreed to spend £1 million on the partnership which will create a £2.9 million training facility.

It includes offices for 10 NHS staff and public gyms for patients who have been prescribed by doctors to take more exercise. Hull FC would invest £1.9 million.

Hull FC chief executive James Rule says the move will put the club at the heart of the local community. From the NHS perspective, it will help to tackle local health issues around obesity, smoking, lung disease, stroke and heart disease.

The hope for Hull FC is that it will encourage more private sponsors to get involved through the CSR route. The club’s main shirt sponsor, ferry company P&O, has operated out of the city for 40 years and has publicly stated that its sponsorship is part of a long-term initiative to get closer to the community. P&O signed a three-year extension to its sponsorship in March 2008 taking the deal through to the end of the 2011 season.

Svend Elkjaer is a director of The Sports Marketing Network which is involved in the commercial and marketing issues across all sports, including clubs and governing bodies. He says many rights holders and sports marketing agencies do not have a strong understanding of what CSR is and how, by linking with public sector bodies, they can raise awareness of, and money for, their sport.

“The police and the NHS, for example, can struggle to engage with communities on their own, so linking with sport helps them enormously,” he says. “What we are seeing are more main sponsors within sports also getting involved in various community projects once they are up and running.”

Rights Holder Sponsorship Initiatives The section has discussed in some detail the wide variety of CSR programmes that sports rights holders are involved in. In the majority of cases the initiatives are run independently of sponsorship or seek sponsors once they have been established. The majority of CSR programmes that are sponsored tend to either fall into the ‘secondary’ sponsorship tier or come about some time after the sponsor’s initial involvement.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

There are, however, examples where rights holders have taken the initiative and sought sponsors to be involved in high profile deals with the objective going beyond the basic injection of cash into the sport.

Although it is often said that sponsorship is a buyer’s market, the seller can at least try to be choosy. Any rights holder seeking to shift its image should seriously consider the potential sponsors it approaches. Although the brand visibility of some rights holders such as Manchester United or Real Madrid is arguably greater than that of some of the world’s largest corporations, there is little doubt that on the whole, it is the corporations that have the larger financial resources and marketing expertise. As such they are in a position to help the rights holder to communicate its desired message.

In the following case study, IMG, the marketing agent of the Women’s British Open Golf Championship identified issues with the sport that it felt needed to be addressed. Realising that the event in question lacked sufficient resources to tackle the issues independently, it was decided that sponsorship might hold the answer.

In this case, the financial value of the sponsorship rights was not diminished through the compromise of finding the right sponsor but at a lower price. Instead IMG sourced a sponsor that offered suitable image attributes for the sport, but was also keen to contribute to a CSR programme that would help it to meet its own CSR objectives. By considering the CSR objectives of the two parties first and foremost, a lucrative deal was struck that might have been more difficult to achieve should the rights holder’s sole concern have centred on the rights fee.

Case study: Women’s British Open, Ricoh And Seeds for Africa

Background

Ricoh

Ricoh is one of the world's leading innovators of office equipment technology. Its product range spans scanners, colour and black & white laser printers, digital connectable colour and black & white copiers, multifunctional devices, network utility software, document management software, facsimile machines, digital stencil duplicators and office consumables.

The company has a very strong commitment to CSR and in particular is keen to emphasise its work on environmental issues. Indeed its global homepage has an ‘Environment’ button on the main menu that links to reports about its work in the field.

This includes the ‘Year 2050 Extra-Long-Term Environmental Vision’. As part of this long-term plan, Ricoh set interim objectives, which aim to reduce the company’s environmental impact by 25% by 2013. This was based on the estimate that business would expand by 8% or more a year. The company states that environmental impact is measured by assessing all issues including CO2 emissions, resource use and use of chemical substances etc.

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Seeds For Africa

Seeds For Africa aims to help African families and communities by the provision of indigenous seeds, agricultural equipment and relevant technical advice, giving individuals and communities a future, not just a temporary answer. Seeds for Africa is working in developing initiatives to present fruit trees to the communities as well as to teach them how to care for trees, with the aim of supporting them in their fight against poverty while promoting reforestation. The plants offered by Ricoh through this programme will be used for these activities.

For the Women’s British Open, tournament director, Ross Hallett, vice president at IMG Golf, was keen to work with a company which wanted an integrated sponsorship and was open to ideas to maximise its involvement in the tournament. It approached Ricoh, which sponsors a number of sports events including ATP events and the Berlin Marathon. In 2008 Ricoh’s sponsorship of The Women’s British Open included a provision to benefit Seeds for Africa.

The programme was seen as much a social project as it is an environmental one, because it contributes not only to CO2 reduction but also improves the diet of the local people, providing education on sustainable agriculture, and encouraging local trade.

Objectives The aim for Ricoh was to boost brand awareness online and offline and employee engagement. IMG Golf wanted to use the sponsorship as a way to show that golf is concerned about the environment. The sport has been criticised in the past for the amount of fertilizer and water it uses and for destruction of natural habitats. Seeds for Africa was hoping for a few thousand pounds to pay for tools, organic manure and trees to put into school and community projects.

For Ricoh, the sponsorship resonates with its environmental credentials and in particular with the UK subsidiary’s ‘Ricoh Tree Dedication Programme’, also run in cooperation with Seeds for Africa. Under the programme, Ricoh plants a tree in a customer’s name for every 100,000 copies made on that customer’s Ricoh equipment and sends the customer an ‘e-certificate’ and information on how the trees are doing via an online blog.

Implementation The key implementation was the recording of scoring at the Women’s British Open, which led to direct donations to Seeds for Africa. For every birdie (one shot below the hole’s par) scored by a professional player, Ricoh promised to plant one tree. Five trees would be planted for an eagle (two shots below par) and 1,000 trees for an albatross (three shots below par). This was an innovative method of increasing the profile of the sponsorship because it was effectively embedded into the key highlights of the play. Any outstanding shots had the potential to be linked to the sponsorship programme by media commentators.

Given that the event is the only major in women’s golf staged outside of the US and is considered to be the ‘most international’ of events on the circuit, the value of such publicity is high. Indeed coverage was on major channels around the world including the BBC in the UK, ABC network television in the USA and TV Asahi in Japan. 58

CSR & Sports Sponsorship The Role Of The Rights Holder In CSR

Ricoh also featured the sponsorship prominently on its website as did Seeds for Change which has a high profile section aimed at corporate visitors.

The Ricoh marquee on-site also sold merchandise with proceeds being collected for the charity and the company contributed to the total number of trees to be donated to Seeds for Africa at the end of the tournament.

Employee Engagement And Participation This included Ricoh encouraging its staff through the link with Seeds for Africa to ensure they turned off their own IT equipment. This is part of a wider strategy to educate employees about the impact of climate change.

The company sees the sponsorship and its involvement in sport as a way to be regarded internally as a thought leader in the industry.

Results As a result of the deal between rights holder and sponsor around the Women’s British Open, Seeds for Africa received £18,007. Part of this was from birdies, eagles etc scored by the players and the other part from takings in the Ricoh marquee which was reported to be ‘very successful’. The number of trees planted in 2008 stood at 1,814. The target is to double that number in 2009.

Amanda Gerrard, corporate fundraising officer at Seeds for Africa explains how the income has been used:

“This funding has been allocated between Malawi and a large tree planting project in Nairobi, Kenya. Some of the funding to Malawi was matched by their government resulting in a total of 4545 trees being planted in Malawian schools.

“An initial project to plant trees in 25 schools has already been well established with around 1500 trees being planted. A further development is almost completed and is just in the final stages of approval, but it should result in around 4300 trees going to 32 schools. This programme will need to be backed up with adequate water supplies and / or provision of water tanks which will come directly from Seeds for Africa funding.

“It is clear that the support offered by Ricoh is invaluable to a smaller charity like Seeds for Africa and the partnership is one we value highly.”

Ricoh has a dedicated CSR department and evaluation of the 2008 activity is continuing into how the brand is perceived in different countries.

IMG Golf reports that the initiative has helped to meet marketing objectives to show that golf is doing more to be environmentally friendly.

On-Going Activity And Longevity Ricoh is sponsoring the 2009 Women’s British Open being held at Royal Lytham and St Anne’s at the end of July and details of the CSR element of the sponsorship are still being confirmed. “Clearly CSR is growing in sponsor’s minds and is a hot topic. We are looking at more grass roots CSR sponsorships around golf and the tournament,” says Hallett.

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

SECTION FOUR. LINKING CSR TO SPORT AND AVOIDING PITFALLS

As with any area of business and any sport there are rules to follow and pitfalls to avoid when devising and implementing a CSR programme.

The obstacles that lie in wait can trip up an organisation and damage its relationships with various stakeholders which could have taken years to establish.

The compliance issues around CSR relate largely to integrity and how a company does business.

It is all about what decisions a company takes and how it resolves dilemmas linked to its activities when they arise.

How a company responds to attacks on its reputation or concerns raised by stakeholders are as important to the whole issue of being socially responsible as where and when a company puts its CSR strategy into action regarding sport.

Many elements of CSR are more art than science and there are some general hygiene rules organisations should follow to produce an effective socially-responsible programme.

The most important rule is that there must be a connection with the business and, if there is a portfolio of activity, it must be cleverly spread and strategically thought out so that it is linked back to a company’s core competencies.

This is not about trying to impress stakeholders by supporting a large number of sports and good causes. A long list will usually lack a common theme or any coherence. Like any other area of business, creating a shopping list around CSR and sport is not a viable strategy.

A CSR programme will fail unless it is at the heart of the business decision making and linked to how the company makes its money.

Brands that want to use sport as part of fulfilling their CSR obligations must also never forget that consumers and other stakeholders demand total transparency.

A CSR strategy will also falter if the whole issue of social responsibility is viewed by big players within a particular industry purely as a way to avoid more regulation.

There is already evidence that law makers around the world are getting tougher on this issue.

In Britain, the Companies Act 2006 requires company directors to have regard for various CSR factors including the interest of employees, suppliers, consumers and the environment under the section ‘enlightened shareholder value’. Whether the courts would actually interfere with business decisions which indicated a company was not being as socially responsible as it could be has yet to be tested.

There are different views on CSR and business in Australia. The Business Council of Australia has come out against government plans to create legislation to force directors to meet certain levels of CSR. The council fears it will stifle innovation and 60

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls creative approaches to CSR that are already being adopted by Australian companies.

When a decision has been taken to spend some or all of a CSR budget around sport, a programme should be devised that displays an obvious synergy with the organisation’s own mission statement and values, as well as its products and services.

For example, in 2002 Vodafone launched the Vodafone Foundation, a network of global and social investment programmes. It is driven by what the company sees as one the four ‘Passions of Vodafone’ which is a ‘Passion for the World Around Us’.

Sport is a key element of this strategy and the Foundation has invested more than £100 million in projects in seven years, including £36.6 million in 2008. There are now 23 local Foundations worldwide. One of Vodafone’s main aims is to use sport to engage with young people who have not flourished through the mainstream education system.

In Australia the Foundation is involved in the Red Dust Role Models scheme which uses elite sportsmen and sportswomen to improve the health and well-being of disadvantaged youngsters. Vodafone has recruited Indian cricketers RP Singh and Vinod Kambli and Australian tae kwondo gold medal Olympian Lauren Burns as well as swimming champion Linley Frame and Australian basketball player Brett Wheeler.

Selecting The Right Sport

It is also crucial to select sports and social causes that are important to the local community in which the organisation operates as well as to the company itself. This will ensure employees as well as existing and potential customers understand the reasons why a company is involved and they will be more likely to support any activity.

Before any activity is sanctioned at a local level, there must also be clear and shared objectives, not only between the sponsor and rights holder but also with any community or social partners.

The sponsor needs to know what resources, in terms of time and money, it will need to provide to support a CSR programme and it needs to be clear what the rights owner’s contribution will be.

Straight talking during the planning stage will avoid problems later on because, for a CSR strategy to work effectively and really add value to all sides, it must be a long- term programme.

Ardi Kolah, a global marketing and brand partnership consultant and author of several works and a speaker on the international sponsorship circuit, says research is vital to identify which issues are of most concern to specific stakeholders relating to social responsibility. These include staff, customers, end-users, suppliers, investors, the media and local and central government.

“Choose causes that can be supported over the long-term,” says Kolah. “This is important because sponsorship is long-term in nature and therefore any CSR programme less than three years in duration may not be sufficiently long enough to have demonstrated and delivered real value to communities.”

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

Gauging the intrinsic popularity of a particular sport to get involved with is also vital before too much time and ultimately money is invested.

First, the declared popularity helps to evaluate whether the sport and the CSR element will have a big enough target audience and have the effect necessary to meet the brand’s objectives. The popularity of the sport in a particular territory and more specifically, the local community will also have a direct impact on how engaged local people are. In Europe, for example, sport has a high level of popularity in all of the major markets, but the level of interest does fluctuate between the various countries.

Chart 4.1. Interest Levels In Sport - Major European Markets

50 45 40 35 30 25 20 15 10 5 0 Spain Italy England France Germany

Very interested Quite interested Not very interested Not interested at all Source: SPORTFIVE/Driving Business Through Sport

Obviously the sponsorship decision making process is much more sophisticated than simply considering audience popularity alone, some of the most successful sports CSR programmes have been in minority interest sports, but in many respects this is the start of the CSR/sponsorship process.

As with any sponsorship activity, it is usually beneficial to consider a sport that matches the desired brand image attributes of the sponsor. Again, research is required.

In Chart 4.2, overleaf, the brand attributes of the London Marathon are shown. For any brand considering sponsoring the event, the research provides a usual guide as to how closely the image of the two parties match. Ideally the sports property’s image attributes should represent the brand’s image objectives, rather than its current position.

Such image attribute charts can be found for most sports, but care should be taken in interpreting the data. The image attributes for tennis overall, for example, will largely reflect the public’s view of Wimbledon, Roland Garros, The US Open and major stars of the game. They will not necessarily reflect a grass roots sponsorship programme such as that discussed in relation to BNP Paribas below. For the BNP Paribas programme to work at a corporate image level, was as a result of its existing commitment to high profile sponsorship of the sport.

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

Chart 4.2. Consumer / Property Relationship – London Marathon

Driving Business Through Sport, Strategy and Research, also demonstrates how a demographic analysis of the target audience can help to determine the ideal sponsorship property. The findings demonstrate that it is possible to identify segments of sports fans with a greater empathy towards charitable causes and a communication channel to reach those fans.

Next the sponsor and the rights holder must consider how the CSR activity can help the sport at every level, from grass roots to national and international standard.

The main ingredient to success appears to be selecting a single sport or cause to support rather than trying to spread the budget too thinly.

The biggest investor in European tennis is BNP Paribas which is a primary sponsor of the Roland Garros French Open as well as a Davis Cup partner. Not surprisingly, its CSR strategy includes a tennis element. In October 2008, for example, it introduced its Tennis For Everyone programme at a home for handicapped children in the city of Mezdra in Bulgaria.

Tennis For Everyone is a joint initiative between BNP Paribas and the Bulgarian Tennis Federation and consists of educational and social tennis programmes, including lessons, for orphans and handicapped children. The company has also financed 72 new beds and a team of 66 employees from across Europe have been engaged in the project by helping to fit a new playground and paint murals in the orphanage.

Stakeholder Cynicism

There is always the risk that any CSR link with sport may be seen purely as a cynical PR or marketing exercise.

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

Good CSR is about sponsors and rights holders being transparent and if companies are to include references to their CSR work in their marketing it should be subtle. This often means using the community project and the results as the news angle rather than the amount of money injected by the brand sponsor to make it happen.

The risks to a company’s reputation if a CSR sponsorship arrangement is handled badly are real. This is why there must be buy-in from the board directors as well as from financial analysts who follow the company’s fortunes. Fortunately CSR is being integrated more and more into business strategy and the accessibility of sport should mean that this trend continues.

To get employees engaged with CSR many companies now employ CSR managers. These professionals tend to come through environmental management routes, engineering or HR rather than from marketing. There are also new roles appearing within organisations to help them with ‘ethical procurement strategies’ as CSR rises up the corporate agenda.

There is also a strong argument for appointing a specialist CRM/sponsorship coordinator to assess which sports and which causes a company should be involved with. This will speed up the decision making process and should ensure all stakeholders are fully engaged with the chosen sport.

However, being involved in strong community projects around sport and showing you are being socially responsible is not always enough to win stakeholder goodwill.

The banks have healthy CSR budgets but they have lost the public’s trust because they are blamed for the global credit crunch and the economic downturn it has caused.

A survey by Cisco published in September 2008, and before many of the tax-payer bailouts were announced internationally, revealed that more than one in three (35%) of consumers now trust the likes of PayPal more than a bank and 70% would trust a bank no more than a non-bank with their money.

In the UK, McCann Erickson’s Moodier Britain survey updated in November 2008 revealed that 50% of the population have ‘little trust” in banks.

These findings reveal just how tempting it can be for corporations, desperate for some positive public relations, to start shouting loudly about how their various CSR initiatives around the world are making a positive difference to thousands of people’s lives.

When it comes to CSR and sport Barclays, the FA Premier League’s main sponsor is a leader. It runs the UK’s largest community sports sponsorship programme, Barclays ‘Spaces for Sports’, with £30 million committed over three years (see Section One: Why Sponsors Need a CSR Strategy Linked to Sport).

Elsewhere on the CSR front, Germany’s biggest bank Deutsche Bank, which sponsors the Ladies’ Swiss Open, has an internal CSR organisation which in 2007 was combined with group communications and now reports directly to the chairman.

The company’s social responsibility obligations around sport include a programme called Keep on the Ball where the bank makes money available for its 15,000 employees to access different sports. ‘Keep On the Ball’ is a motto the organisation

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls wants its staff to follow in their personal life so they remain healthy. It is also a metaphor for the business’s professional values.

Its staff also volunteer for almost 20,000 working days on more than 2,400 charitable projects each year. Employee engagement might be tougher to achieve this year, however, after the bank announced its first annual loss since being restructured after World War II and jobs are going.

Germany has been behind much of Western Europe when it comes to CSR (or corporate citizenship), according to an international report by the Global Education Research Network in association with the Boston College Centre for Corporate Citizenship in the US.

The report, ‘Corporate Citizenship Around the World – How local flavour seasons global practice’, says the civil society-focused approach has now arrived in Germany after a 10 year delay.

The landscape has been determined by the occasional philanthropy by small and medium sized businesses and a strong performance on issues of environment/sustainability and workplace health and safety within all organisations. The report says it is too early to say if Germany is experiencing a substantial change with regard to CSR or is simply relabelling old practices.

The Importance Of Being Socially Responsible

Being socially responsible is central these days to being seen as a responsible organisation on many levels. It is also linked to how sustainable businesses are. This is not just about environmental sustainability but relates to economic and social aspects too. A corporately irresponsible organisation is one that adopts a financially unsustainable approach or offers financially unsustainable services to its customers.

Indeed some of the world’s most disgraced corporations had healthy CSR budgets in place and also had links with sport but sustainability was much lower down on their agendas.

In the US, energy company Enron, once a major sponsor of the Houston Astros baseball team which included a $100 million 30-year naming rights deal, has become a by-word for corporate irresponsibility.

The company was involved in a host of socially responsible initiatives but was using its CSR reporting, environmental and community programmes as a way to disguise what was really going on inside the company. Its financial misrepresentations were covering up a big hole in its central finances. The company had published a social and environmental report, which looked at the moves it was taking with regard to its environmental impact, its employee relations, its anti-corruption and bribery policies, and its community relations programmes. Another company heavily involved in CSR and sport but which has been rocked by a boardroom scandal is Satyam. It is India’s fourth largest information technology outsourcing company by revenue and is providing technologies for the 2010 FIFA World Cup.

It has embarked on an impressive CSR campaign in India designed to promote university football in the country. The Satyam Football Challenge is a 10-year

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls agreement to give football in India the same profile as cricket. A spokesman insists the initiative will continue to be supported and that the recent billion dollar fraud scandal which hit the company at the end of 2008 has not affected the project. The company is up for sale though so this might change.

The negative experiences of Enron and Satyam add fuel to the fire of critics of CSR, such as some NGOs, who remain suspicious of big companies getting involved in community projects around the world and are cynical about CSR. The fact that it has become ‘an industry’ is enough to make them suspicious.

This emphasises again the need for corporations to be fully transparent and to plan and implement their CSR strategies around sport with extreme care.

Christian Aid, for instance, says it recognises that CSR is now ‘a vital tool in promoting and improving the public image of some of the world’s largest companies and corporations’. It published a report called ‘Behind The Mask: The Real Face of CSR’ which scrutinises the CSR record of major companies including British American Tobacco in Kenya, Coca-Cola in India and Shell in Nigeria.

It claimed that the image of multi-national companies working hard to make the world a better place is often just that – an image. It even calls for new laws to make businesses responsible for protecting human rights and the environment wherever they work.

The report has been attacked by CSR experts, however, who accuse Christian Aid of being one-sided in its own reporting, with no objective analysis of the achievements and progress of CSR. They also say many NGOs do not understand the bottom line business case for CSR.

Few people could dispute that Coca-Cola, the world’s largest soft drinks company, is making a difference in Indian society, for example. When it comes to CSR and sport it has a number of community initiatives around football, cricket, basketball and rural sports.

It is currently helping aspiring Olympic athletes and running competitions to find football talent. The company says it is trying to create a sporting culture throughout India to encourage Indians to follow a healthy, active lifestyle. Coca-Cola is also a founding partner of the Special Olympics World Games for athletes with learning disabilities.

Away from sport, Coca-Cola has set up a $10 million CSR foundation in India to help communities with water management, water conservation, wetland management and environmental campaigns.

There is no doubt corporations could be doing more and it is up to them to work harder to change negative perceptions about CSR programmes.

Achieving this without CSR becoming a full-blown PR and marketing vehicle is a tricky balancing act that organisations need to master. Of course, it is unavoidable that some companies will use CSR for public relations purposes but when this happens it does not take long for the media and consumers as well as NGOs to expose the cracks.

However, there is a danger for NGOs if they do not engage more positively with corporations that are taking their social responsibilities more seriously. By simply

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls returning to easy anti-corporate messaging they might miss out on opportunities and sponsors funding that would actually help the causes they are championing.

Critics and cynics of CSR can often underestimate sport’s ability to engage with all social demographics and generate goodwill within local communities. Sport is a powerful tool for developing people, motivating individuals, developing leadership and educating some of the world’s most disadvantaged people.

There are real fears that negative views, such as those expressed by Christian Aid, could harm potential sports-linked CSR strategies in future and deter sponsors and rights holders from getting involved in global initiatives that are improving people’s lives.

Where it is being used correctly, sport is providing an opportunity for mutual cooperation between aid agencies to assist in building a global civil society.

Suspicion from stakeholders and observers can also be prompted if a CSR partnership between a brand and sport seems inappropriate.

One company which has had to work hard to win the plaudits for its work in sport is McDonald’s.

It has followed a strategy of supporting community sports coaching as a way to showcase its CSR credentials. This is despite criticism that it has done more harm than good when it comes to encouraging children to eat healthily.

However, it is being applauded for its work around community sport.

In 2006 the company signed a four-year partnership with The Football Association in England to boost the standard of coaching of young players in local communities.

A previous scheme created 8,000 new community-based volunteer coaches. Its aim is to have a further 4,000 coaches by 2010.

When the deal was inked, McDonald’s described it as the perfect platform for the company’s long-term investment in the communities that its restaurants serve.

In October 2008 McDonald’s, which has more than 31,000 local restaurants in more than 100 countries, released its fourth CSR report themed ‘Responsible food for a sustainable future’. The company says its relationship with sport demonstrates its ongoing commitment to promoting balanced, active lifestyles.

A positive testimony to McDonald’s work in sport was seen last October when its senior director for communications and government relations, Caroline Weber, left the company to fill a newly created role of executive director of communication and public affairs at Sport England. This is the non-departmental public body and National Lottery distributor.

While its work in helping children to do more sport is commended, critics still question McDonald’s role as a sponsor of global sporting events, including the Olympic Games and the FIFA World Cup, which are enjoyed by children. Marketing to children remains a concern in many countries.

The company has been involved in the Olympics for 40 years. In 1968 it airlifted hamburgers to US athletes competing in Grenoble in France after medal hopefuls

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls complained of being homesick for American food. Eight years later, in Montreal, McDonald’s became an official sponsor. The Beijing Games in 2008 marked the company’s seventh as Official Restaurant.

To counter the criticism the company launched the McDonald’s Champion Kids programme around the Beijing Summer Games in 2008. More than 200 children from around the world were given a chance to experience the Games first hand.

Another company having to defend itself for linking to sport is Cadbury Schweppes. It was accused of encouraging children to eat more chocolate when it ran a campaign designed to encourage the purchase of sports equipment for schools in the UK.

The public and media backlash took the company by surprise because Cadbury has a long tradition of CSR stretching back to its founders’ philosophy of fair treatment of employees and philanthropy in the community back in the 1870s. The company believed that healthy employees produce a profitable business.

Yet in 2003 its scheme to swap tokens for sports equipment was slammed by parents, health campaigners, the media and the Food Commission who are all concerned about growing child obesity rates in the UK.

The criticism centred on the claim that using chocolate to promote sports was an inherent contradiction. The scheme, part of Cadbury’s broader Get Active initiative, involved the collection of tokens on 160 million bars. It was calculated that 5,440 bars of chocolate would need to be eaten for a school to claim a free volleyball. The Food Commission pointed out that for UK pupils to collect all 160 million tokens they would be purchasing two million kilogrammes of fat.

Unfortunately for Cadbury’s, the negative media attention came at a time when the UK government was considering tougher regulations on advertising food to children. In 2007 scheduling restrictions began on the television advertising of foods high in fat, salt and sugar, including confectionery.

The irony of the Cadbury’s campaign was that it was designed to make children more active and get them away from the television and the computer. The company also claimed, like the tobacco industry has in the past, that the token idea would not encourage children to eat more chocolate but would persuade them to purely switch brands. CSR experts say the Cadbury example is a classic case of a brand winning the science but losing the argument.

What other brands have learned from Cadbury’s experience is that they must think carefully about the potential negatives involved when planning any CSR activity around sport.

Having the right motives does not always lead to the right outcomes for the sponsor. This is why brands should not rely too heavily on what marketing focus groups might tell them about what CSR strategies they would like to see a particular business adopt. As in politics, individuals do not always tell the truth when questioned by pollsters.

Companies that claim to be environmentally-friendly can also face accusations of ‘greenwashing’. This is when a company attempts to mislead consumers that an aspect of a product is good for the environment when in reality it is just a cost-cutting measure. This could be encouraging hotel guests to use fewer towels or less toilet

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls paper in a bid to save the planet when in reality the company has set a green agenda as a way to save money.

This is one particular pitfall organisations can avoid if they link their CSR strategy to sport rather than to purely an environmental cause.

In the current economic climate it can be hard for organisations to justify the amount that they are spending on sports-related CSR projects. If staff are being sacked or made redundant it can seem sensible to cut funding for community initiatives, especially if they are happening miles from where the employees live. Unfortunately, any significant reduction in time or financial commitment will fuel any cynicism among stakeholders.

When criticism is flying around it is important all businesses remember why they have a CSR strategy in the first place. Whatever the financial climate, companies still have a social responsibility. If CSR budgets do drop in 2009/10, companies will face accusations that they are not taking their responsibilities to the environment and economic/social impact, seriously enough.

In response, the Ethical Corporation Institute, a London-based CSR think tank which encourages debate on responsible business, has published a list of 10 reasons why companies should still invest in CSR in the recession.

It points out that: 1. CSR that does not alter business models radically can benefit the bottom line 2. Reputation and transparency are more important to retain and attract talented employees and customers 3. Communities are feeling even more vulnerable and are looking for leadership from local organisations 4. Customers are worried and concerned about which businesses they can trust 5. Regulators are looking to business as a scapegoat for society’s current ills 6. People still care about green issues so this message must still be conveyed 7. The media is still looking for great stories and ethics-related news relating to staff losing their jobs needs to be countered, subtly using CSR activities 8. There is an opportunity to gain trust during a downturn 9. Companies need to think about when the recession is over. Economic slumps do not last for ever 10. It is a chance to become a more lean and efficient company and at a time when business partners will be more understanding.

It seems now is as good a time as ever to link CSR with sport - as long as the rules are followed.

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

Case Study: Aviva UK Athletics Sponsorship

Background Aviva (the new name for Norwich Union) has been the team behind UK Athletics for more than a decade, supporting the sport at every level from playground to podium.

Helping athletes to achieve their dreams and young people to get active, stay healthy and learn key life skills has been a key aim of the programme.

The UK Athletics sponsorship rights include:  Sponsorship of six televised athletics events broadcast on the BBC and around the globe  Sponsorship of the Aviva Great Britain and Northern Ireland Team  Title rights to a number of grassroots programmes to support the brand’s aim of getting 15 million children active by 2012

There are also strategic partnerships with the Youth Sport Trust and the National School Sport Champion, Dame Kelly Holmes, to further impact on local communities and to gain increased credibility among a political and community audience.

To widen the appeal of its sponsorship and engage target audiences, Aviva launched the innovative Community Sports Fund in 2007 to give communities the power to decide how £1 million of funding is allocated over two years.

Objectives Aviva is the UK’s largest insurance group and has a major role to play in the nation’s health and wellbeing. As the biggest corporate investor in grassroots sport in the UK it aims to: • Get 15m kids active by 2012, nurturing future champions and enabling the next generation to get active and learn key life skills, as well as creating a lasting legacy for the sport. • Communicate Aviva’s long-term commitment to athletics from playground to podium, driving emotional connection, trust and consideration of the brand. • Enhance Aviva’s reputation as a socially responsible company.

Implementation

National School Sport Week In 2008 Norwich Union supported the Government’s first ever National School Sport Week, in which it engaged with three million children in school sport. During this first national celebration of school sport, a network of more than 6250 schools helped create a five-day calendar of events involving 18 different sports. The campaign focused upon creating ‘local champions’ with support from Olympians Darren Campbell and Sally Gunnell.

The campaign was amplified through ambassador radio days, sports day themed radio drops and a survey highlighting the nation’s attitude to school sport. Activity culminated in a sports day at Number 10 with Gordon Brown, Department of Culture

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

Media and Sport and Department for Schools, Children and Families Ministers and local school children.

This partnership provided Aviva with added credibility and profile for its grassroots sponsorship.

Community Sports Fund Norwich Union developed the innovative Community Sports Fund to provide up to £1 million in additional support for deserving grassroots schemes in 2007 and 2008.

The campaign empowered communities by giving them the chance to vote for schemes in their area to win bursaries ranging from £1,000 to £50,000 – designed to provide lasting social impact in communities nationwide.

The company also worked with charity partners including the Youth Sport Trust whilst inviting public submissions. A total of 440 schemes were accepted onto the scheme over the two years.

UK Athletics Grassroots Schemes The grassroots portfolio allowed Aviva to engage one million children a year in athletics.

Four schemes cater for all ages and abilities and include ‘have a go sessions’, competition structure, awards and teacher toolkits.

With UKA tasked to drive participation, the company communicated its involvement by demonstrating the scale of its sponsorship from playground to podium, utilising inspirational athlete role models to generate media coverage.

It encouraged staff to make a difference in communities by offering coaching badges and volunteering opportunities at grassroots events.

School Sport Matters There is a partnership with the Daily Telegraph as the only national newspaper that covers school sport. The weekly School Sport Matters columns and monthly features champion school sport and the annual awards ceremony recognises outstanding achievements.

The School Sport Matters campaign includes:

 Editorial content in the Daily Telegraph including weekly columns and monthly double-page features championing school sport  Tailored grassroots advertising alongside double page spreads  Online activity through the Daily Telegraph website  Advertorials in relevant sections of the paper to promote all of Aviva’s sponsorship activity  Annual awards ceremony to recognise outstanding achievements

CSR & Sports Sponsorship Linking CSR To Sport And Avoiding Pitfalls

Results

• Since 1999, Aviva has engaged with nine million children and is on track to reach the target of getting 15 million children active by 2012, creating a long- term legacy for community sport. • In 2008, three million children participated in National School Sport Week (25% of the UK school population) and one million in the UKA grassroots schemes. • The support helped Government exceed its 85% child participation target (two hours of PE and school sport per week). • In the Community Sports Fund’s first two years, Aviva empowered communities to decide how £1 million is allocated to local sporting development, with 170,000 votes being cast. • Between 2007-09, awareness of the community commitment has increased by 93%, leaving people significantly more likely to trust and consider Aviva.

On-Going Activity And Longevity Aviva has been the team behind UK Athletics for more than a decade. Its goals are long-term and shared with UK Athletics. Many of Britain's top athletes including Denise Lewis, Kelly Sotherton, Jessica Ennis, Nathan Douglas and Martyn Rooney have come through Aviva’s sponsored grassroots programmes. To date, nine million children have been touched by the grassroots programmes and Aviva is on track to meet its target of getting 15 million children active by 2012, creating a long-term legacy for the sport.