FOOTBALL clubs could overcome many of their financial difficulties by embracing community ownership as a mechanism for delivering long-term stability, according to a new report from the Co-operative Party think-tank, Mutuo.
Writing in Back Home*, Dr Christine Oughton, Director of the Football Governance Research Centre at the University of London, argues that the current financial crisis in football has exposed the weakness of the traditional company model, which is often over-reliant on the financial support of a small group of people, and that community ownership could provide a more sustainable business model for clubs.
The report suggests that clubs should consider adopting the ownership model, a form of co-operative society developed by Mutuo.
This would offer membership to a wider range of stakeholders including fans, local businesses and other parties with an interest in the health of the club, and thus attract greater, and more secure, investment.
The report also provides examples of the possibilities that exist for transforming stadia into hubs for activities such as other sports, education, music, enterprise and healthcare.
Mutuality is not new in football. Clubs including Arsenal, Leicester City and Manchester United originated as membership organisations rooted in their local communities. And more recently Supporters' Trusts, which give fans a collective say in how their clubs are run, have sprung up in clubs at all levels throughout Britain.
Mutuo's Director Peter Hunt (pictured) says: `The experience of many clubs recently is that when times are tough it is the local community who are the only ones prepared to dig deep and support the club financially.
`It is the local supporters who are helping and saving many clubs in their current financial peril, but the need to please shareholders and the markets has meant that the fans and the local community, the bedrock of a sustainable club, are too often marginalised.`
Added Mr Hunt: `Clubs would benefit enormously from adopting a business model which harnesses community commitment more effectively.`
Clubs such as Macclesfield Town and Brentford have already taken a lead in using their stadia more widely to raise revenue.
Dr Christine Oughton comments: `Clubs must enlist the support of whole communities if they are to transform themselves and survive. Even if they do not decide to become fully mutual, they can widen their appeal and increase their revenue stream by making better use of their stadia, which are often in locations of great need and crying out for improved facilities.
`Developing them into centres providing cultural, sporting and educational services would provide employment, help boost loyalty to the club – and bring in revenue from sources not normally associated with football.`
Allowing football clubs to be set up as mutuals requires a change in the Football Association's rules. However, the current legislation was designed to prevent clubs being run as unincorporated bodies rather than as a deliberate barrier to mutuality, and could be amended without difficulty.
*Back Home: Returning football clubs to their communities by Dr Christine Oughton, Cliff Mills of Cobbetts Solicitors, Malcolm McClean of Community Action Network and Peter Hunt, is available from [email protected] or 77 Weston Street, London SE1 3SD, price £ 10.