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1 Česká kinantropologie 2014, vol. 18, no. 3, p Corporate Social Responsibility and Sport: Some Examples from Football* Jan Procházka Department of Sport Management Faculty of Physical Education and Sport, Charles University in Prague Abstract Corporate social responsibility (CSR) is a phenomenon that is gaining importance in corporate management. There is not so much literature yet about CSR, and even less about CSR concerning sport. Therefore, the aim of this article is to introduce into the costs and benefits of the corporate social responsibility and to quote some examples of its usage in sport. For that, we use some of the scarce literature and meta-analysis. Key words: Corporate social responsibility, sport, marketing, costs and benefits. Introduction and Methodology Corporate social responsibility (CSR) is a phenomenon that is getting into the marketing and management policies of many modern firms. It is being introduced as a modern way of being for many firms and entities. CSR also can regard sport, both actively and passively. It can be in an active way, when sport is the object of CSR, i.e. when sportsmen and sport entities effectuate CSR in their policies. It can be done passively, when sportsmen and sport entities are subject to CSR policies of firms. However CSR is a phenomenon older than forty years, it has not been much studied and developed. It is true, there are some theories developed from it (e.g. the four responsibilities theory, stakeholder theory, business ethics theory, corporate citizenship and corporate social performance (Godfrey, 2009; Walters & Tacon, 2010), but in comparison to other theories regarding management, it is not so much developed. There are very few publications regarding CSR and sport. Therefore, thve methods used for this paper consist mainly of meta-analysis. CSR has got both costs and benefits. Costs are arguments for not introducing CSR as a policy, while benefits speak for it. In general, benefits of well-done CSR can overvalue the costs. There can already be found examples of CSR regarding sports. For the passive way of sports CSR, it gets closer to sponsoring. However, some institutions and clubs, for instance in football/soccer have already joint the CSR movement and consider it as a part of their policy. ˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉˉ * The article was written in the framework of the scientific branch development program UK FTVS P 39 Social Scientific Aspects of Human Movement Studies. The research was conducted in the framework of a UK FTVS Prague research goal SVV

2 Corporate Social Responsibility A firm as such has three main missions in its existence. These are: To make money/profits, To accept its macro-environment, To interact with its micro-environment. These missions can be explained very easily. The first mission is the most apparent one. A firm is supposed to make profit, which is in money. The second one can be understood as to accept the outer world as it is the environment we cannot directly influence. The third one is to interact with to influence and to be influenced by the world we can influence. And such is the micro-environment. As a part of the micro-environment, we can define stakeholders. These are people and institutions that are in interaction with the firm and have interest in these interactions. Between the stakeholders, we can count the firm owners (shareholders), employees, customers, suppliers, civil society, communities and the society as a whole. Through and towards these stakeholders, the firm can effectuate the so-called corporate social responsibility. Up to the European Commission, it is: A concept, whereby the companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis. (EC 2013) Corporate social responsibility is a theoretical phenomenon that is about forty years old (Coombs, Holladay, 2012). Basically, it makes a new activity of the firm which regards the social environment of the firm and interacting with its stakeholders. In practice, it means (for instance) better relations of the firm to its environment, employees, to the civil society. For instance, if a firm makes better roads to be constructed towards its plant, the roads serve also the surrounding communities. If it buys from the local producers, it helps the local economy and gets better relations with its neighbors. CSR can have many different forms, beginning with philanthropy and volunteering, going through cause promotion (increasing awareness of a cause) to cause marketing. It can even include recycling old products and making them sellable again in poorer markets. Costs and Benefits of CSR As any firm policy, also CSR has got costs and benefits. These are the main reasons why to do it or not. These costs and benefits are very important for any firm that is considering to implement CSR to decide what steps and policy (policies) it should do. The main costs are (adapted up to Coombs, Holladay, 2012): Change in investment: CSR is an investment that has to be justified to the owners/ /shareholders of the company. Risks of stock devaluation: CSR is not necessarily a productive investment. Therefore, it might decrease the profits. As a result, the stock price or the value of the firm might (at least temporarily) decrease. Direct costs: The direct costs spent for CSR (including time usage) show in the accounting of the firm. They have direct effects not only on the profits, but eventually also on the prices and the competitiveness of the firm. 10

3 Bad orientation of responsibilities: The time and human resources used on CSR might result in changing the orientation of the management and thus change the priorities of the firm too much. Result consequences: If the goal of CSR is missed, it seems to be wasted money and human resources. Job threatening: For the actual workers, CSR might seem to be a threat, as it takes some resources of the firm and thus needs the firm to restructure. As a result, some jobs might be lost. If CSR is well done, there are also benefits that overvalue the costs. The main ones are (adapted up to Coombs, Holladay, 2012): CSR can be profitable: Some policies and activities included in CSR can help the profitability of the firm. As an example, we can mention a better usage of energies which will generate lower costs. Avoiding excess government regulation: By having a responsible behavior, the firm is less suspected to abuse of its powers and thus provokes less regulation from the side of the government. It might even generate some tax deductions. Social legitimacy of the corporation: The firm will be better accepted by its environment, it will be less suspected of abusing its powers, and might even generate better identification of the environment with the firm. This might even generate better sales. Employee motivation: If the employees agree with CSR goals and policies, they might be better motivated for working more efficiently. Injustice and problems solving: CSR policies and activities are also focused in helping to solve some problems and injustice. This might help to generate positive public opinion about the firm and its activities. Reputation and Public relations (PR): The environment (surrounding communities, clients, employees) might better accept the firm and its CSR might thus contribute to a more positive PR of the firm. Dialogue: As mentioned above, CSR helps public relations and relations with other stakeholders. As a result, it should also give some better arguments in discussions about some topics and it might make it easier to solve problems with some stakeholders (e.g. nature protecting activists). It can be copied: In general, there is no copyright on successful CSR activities. Thus, these can be copied. As a result, CSR policy can be more easily done successful. Logically, both costs and benefits are present. In general, the firm should consider it in the long term. If the implemented policy does not fail, the strategic outcome should be positive: The firm can even make more profit thanks to the right CSR policy. Corporate social responsibility is even quite desirable, if not required. In some countries, CSR annual reports are demanded and CSR might help the firms to get public contracts. There is even a norm that regards CSR: ISO 26000, which is valid since 2010 (Hahn, Weidtmann, 2012). 11

4 CSR and Sports As we mentioned sooner, there is already some literature regarding the CSR and sport. However, it is very limited. For instance, Godfrey (2009) makes only an overview and speaks of the key issues regarding CSR in sport. On the other side, Walters, Tacon (2010) already use the derived stakeholder theory for the UK football industry; however, even this article is a bit limited in conclusions. Therefore, we can assume that this topic is still less developed. Sports can regard the corporate social responsibility in both active and passive ways. Passively, it means that for instance local amateur clubs are financially helped by local firms. It can also be that a firm supports sport activities of a school or of an institute which takes care of mentally disabled people. Actively, some famous sportsmen can support a cause either financially or by helping its promotion. Up to Walters & Tacon (2010), the most important issue for CSR in sport is the influence of sport on the society. In other words, the fact that sports are getting very influential and important for the western culture and society should be used for making the society more responsible: Sportsmen and sports institutions should work as examples and motivate the society to act more socially and responsibly. Let s mention some examples of CSR regarding sports. FC Barcelona and UNICEF For five years, the FC Barcelona jerseys wore the symbol of the United Nations Childrens s Fund (UNICEF). This increased the awareness about the UNICEF existence and activities. In exchange, FC Barcelona was paying 1.5 million EUR per year to UNICEF (Ferrand, McCarthy, 2009). UNICEF got some more money for their activities. For FC Barcelona, it probably did not bring any substantial profits, but they certainly did not mind using the space on their jerseys in that way. It even might have contributed to the PR of FC Barcelona and brought some new fans, eventually buying the jerseys. The only change in the latest years was transferring the logo of UNICEF from the front of the shirt to its back. UEFA Against the Racism Campaign and Other Topics In the latest years, UEFA promotes a campaign Against the racism. UEFA has reinforced its stand against racism and, together with the players body FIFPro, is now actively supporting campaigns attempting to banish this evil from football and society. European football s governing body has forged a close partnership with the Football Against Racism in Europe (FARE) network, which comprises groups and bodies working against intolerance and discrimination across the continent. (UEFA 2013b) This seemingly has no relation to football and brings no direct profits to UEFA. However, it is good for UEFA, too. In the first place, it helps the PR of UEFA. Thus, it has also direct effects on its work. It reminds the fans to behave in a better way and so, there are fewer problems at the stadiums and outside. It makes football/soccer to be more enjoyed and less problematic, it is better accepted by the civil society. In the same time, UEFA uses its moral strength to make the society more peaceful. As a result, more fans might come to the stadiums and follow football. UEFA also makes other types of support. Up to Walters & Tacon (2010), UEFA committed to allocating 0.7 per cent of annual revenue to social projects. 12

5 That is probably why on the 13 th of February, 2013, they have handed a 100,000 Euro cheque to the International Committee of the Red Cross to support the rehabilitation of land-mine victims in Afghanistan (UEFA 2013c). FIFA Football for Hope Campaign Also FIFA has several activities in CSR. One of them is Football for Hope, which exists since Since then, more than 100 projects in more than 50 countries were accomplished. As FIFA says: Hundreds of social organisations worldwide make use of the unique appeal of football and the sport s core values in their daily work. FIFA is supporting them through Football for Hope. This is the main premise of the program. The support is only for non-discriminatory non-governmental and similar organizations with long-term approach. (FIFA 2013) This information even makes part of a FIFA ublicity e.g. on Eurosport. As a result, it helps the PR of FIFA. What Future? As CSR is quite young as a scientific discipline and, as mentioned before, we have not found any publication regarding CSR in sport, we shall expect more development in CSR in sport, both practically and in theory. In practice, we shall expect more sport institutions performing CSR actively and/or accepting it passively. Regarding the theory, we shall expect further studies in the topic. Concluding remarks As we can see, CSR has both costs and benefits. When CSR is being well done, benefits should overvalue costs. CSR also regards sports. It can be either in a passive way (e.g. similar to sponsoring sport entities, but without typical sponsor promotion) or in an active way. Actively, for instance FIFA, UEFA and FC Barcelona have already shown their commitment. What is important to CSR is that it is not necessarily done for profit. However, it can increase the PR and even the profits (both directly and indirectly) of the entity that does it. CSR and sport is still a new open chapter. However CSR is already being studied by scientists, it is not the case of CSR regarding sport. References COOMBS, T., HOLLADAY, S. J. (2012) Managing Corporate social Responsibility: A Communication Approach, Wiley-Blackwell, ISBN EC (2013) European Commission 2013, [online, cit. 10. března 2013] mobile/topics/policies/sustainable-business/corporate-social-responsibility/index_en.htm. FERRAND, A., McCARTHY, S. (2009) Marketing the Sports Organisation building networks and relationships, Routledge, FIFA (2013) Online on 13/03/2013, from: footballforhope/programmes/index.html. GODFREY, P. C. (2009) Corporate Social Responsibility in Sport: An Overview and Key Issues, Journal of Sport Management, 2009, 23, HAHN, R., WEIDTMANN, C. (2012) Transnational Governance, Deliberative Democracy, and the Legitimacy of ISO 26000: Analyzing the Case of a Global Multi-Stakeholder Process, Business and Society (doi: / ), online on from: 13

6 UEFA (2013) Unite against racism in European football, UEFA guide to good practice, UEFA, online on the 13/03/2013, from: UEFA (2013b) Online on 13/03/2013, from: UEFA (2013c) Online on 13/3/2013, from: newsid= html. VISSER, W. (2011) The Age of Responsibility: CSR 2.0 and the New DNA of Business. Wiley, ISBN WALTERS, G., TACON, R. (2010) Corporate social responsibility in sport: Stakeholder management in the UK football industry. Journal of Management & Organization, 2010, 16: Mgr. Jan Procházka Department of Sport Management, Faculty of Physical Education and Sport, J. Martího 31, Pragua 6-Veleslavín, Charles University in Prague 14