British football governance is changing

British football governance is due to undergo major change. Previously, it had essentially free reign over its own fortunes. Now, more oversight is on the horizon. 

Football in the United Kingdom is arguably one of the country’s most widely known industries. It is a showpiece export known to populations worldwide, boasting star players, famous club brands, and lucrative TV rights deals. 

But recent pressure on how it’s run has forced the ordinarily pro-free market Conservative government to get strict with new rules, announced this week and likely to come into force in 2025.

Football teams in the UK will soon be under the jurisdiction of a government-sanctioned regulatory body. 

This regulator will be given powers to address some of the most divisive and persistent recent issues in the British football system.

• It will be able to oversee clubs’ financial stability, work with them if they are in financial trouble, and take steps to promote long-term sustainability. 
• It will be able to assess the suitability of owners, directors and investors at every club (more on this later). 
• It will be able to impose agreements between different levels of the football system if none come naturally. 
• It will be able to stop clubs from forming breakaway competitions.
• It will give fans more voice regarding “heritage” and strategic direction.

Fans and lower leagues within the system are generally pleased because they feel the regulator will bring more structure and ensure their long-term resilience. 

The Premier League isn’t so sure. As the top-level and international flag-bearer of British football, the Premier League commands the most global attention and capital. The league has said it will scrutinise the new rules amid fears its competitiveness and ability to attract investment could be hurt.

UK football is so popular that it can regularly feel like everyone in the country is a stakeholder in some way. So, when the system attracts criticism (such as bad governance, financial mismanagement, and trading fan wishes for exclusive competitions), the government will inevitably respond.

More than anything, it reflects how much British football’s governance has been scrutinised lately. An industry with that much public attention can never hope to hide its governance in the shadows. There will be comments, criticism, and close inspection. You could say the same for other high-profile industries, like gambling or banking. 

It also reflects the distrust that stakeholders have about governance in British football. 

In any standard governance scenario, directors are bound by their accountability to the company and, increasingly, by their relationship with key stakeholders. British football had managed to avoid some of this over the last few decades, attracting big investments from abroad, such as the controversial Glazer family to Manchester United, and Russian oligarch Roman Abramovich’s tenure as owner of Chelsea. 

Both of these high-profile relationships attracted criticism for extensive financial mismanagement and even national security concerns. 

Now, the new regulator’s powers appear to represent some of that distrust in law for the first time.

It’s by no means an “abandonment”, but fans should receive slightly more influence in the new arrangement. 

Under the auspices of the new regulator, fans will:

• Have a veto on any changes related to the club’s “heritage”, such as club colours and crests. 
• Have a right to voice their collective opinion on other issues, although corporate leaders won’t have to listen to them. 

So, while fans might have more representation, they still have far less compared to some other football governance systems. The obvious example is Germany, which has a “50+1” rule. Here, club members (through which fans have an enormous influence) must hold over half of the voting rights in any club by law. 

German football is well-known for its heavy fan culture, low ticket prices, and distinctly low impact of outside investment on governance. So far, Britain remains a while away from that.

The announcement of a new regulator is another example of governments giving a legal foundation to stakeholder mood and demand. We’ve seen this before around other topics like ESG and financial crime, and we’ll see it again. The bottom line is that lawmakers—particularly European lawmakers—show little hesitancy in getting tough in this area. 

Stories like this show us what modern stakeholder pressure looks like and how it can effect change. Directors in all British football clubs now need to adapt to that change. There will undoubtedly be teething issues with the new regulator, if not a standard degree of pushback. Still, the broader focus on all stakeholders – instead of just shareholders – is becoming the new normal. 

You can read more about the new regulator here.