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A motion of no confidence

07 March 2017 by Craig Beeston

FA: A motion of no confidence - read more

The FA must strike a balance between its football heritage and modern governance

The spotlight has returned to the state of governance at the Football Association. The House of Commons held a debate on 9 February on a motion of no confidence in the FA’s ability to perform its duties or reform its governance structures.

Football is an enormous part of the sporting and cultural fabric of our society. As the guardian of the national sport, the FA presides over 11 million players of all ages, 119,000 affiliated teams and 500,000 volunteers who make the game possible.

Not fit for purpose

Even since the Burns Review in 2005, aimed at addressing shortcomings at the FA, there have been growing public concerns that the governance arrangements at the organisation are not fit for purpose. In 2011 and 2013 the Department for Culture, Media and Sport (DCMS) Select Committee made a number of criticisms of the FA and called for reforms to enable the FA to set the strategic direction for English football.

In particular, it recommended the board be reduced in size and reformed to decrease vested interests and the predominance of representation of the leagues. The Committee saw the FA Council as not fit for purpose, lacking diversity and suffering from excessive length of tenures and a membership almost identical to that of the shareholder body.

“Few corporate organisations in the UK operate a two-tier governance structure such as that of the Football Association”

In December 2016, three former FA chairmen and two former senior executives wrote to the DCMS Committee to express their concerns that the organisation lacks independent, external perspective and is dominated by the financial might of the Premier League.

They argued that the FA is possessed of ‘arcane and convoluted’ decision-making structures and that the majority of people in senior positions are unqualified for the complexities of the FA’s remit and unrepresentative of the modern game and modern society. The letter observed that stakeholders ‘collectively exhibit vested interests, intransigence and short-termism at every turn’.

The DCMS Committee Chair, Damian Collins – who tabled the Commons motion – agreed that the current structure of the FA makes it impossible for it to reform itself and that, as such, ‘there is currently no effective governing body for football in England that is capable of responding to the challenges that face the modern game’. Collins, like his Committee colleagues, has called for Government legislation.

Anachronism

Increasingly, the FA has seemed something of an anachronism. It operates in a commercial world far from the amateur game out of which its structures grew. Its finances are, of course, dwarfed by those of the Premier League, which is accused of wielding excessive influence over the national governing body.

Yet in 2016 it announced an overseas broadcast rights deal for the FA Cup reported to be worth £820 million over six seasons. In the same month that the Sports Minister made clear the Government’s intention to remove £30 million of public money if the Association did not comply with the requirements set out by the new Code for Sports Governance, the FA announced a 12-year extension of its kit deal with Nike, worth £400 million with potential performance-related bonuses. The FA Group’s turnover for the financial year to July 2015 was £318 million.

Few corporate organisations in the UK operate a two-tier governance structure such as that of the FA, where reforms such as those that have been proposed can be blocked by a Council of 122 with an outdated membership, numerous conflicts of loyalty and interest and a lack of diversity of gender and background.

If the FA is to operate efficiently and effectively in a commercial environment, and still be able to act as the guardian for the game at every level, it must adopt architecture more appropriate to a modern corporate entity. It cannot remain with one foot in the 21st century and one in the 19th.

Potential reforms

The proposals which the FA will put to the Sports Minister in March have not yet been revealed, but there have been reports as to their content.

The addition of two female directors to the existing one in an enlarged board of 14 would, at 21%, fall short of the new Code’s target of a minimum of 30% of each gender, and would also require Sport England’s agreement to exceed the stipulated board size of 12. Raising the number of independent board members to four would achieve the requirement of 25% independent non-executive directors. Governance improvements must go further, for the good of the game and all that support it.

“The FA must strike a balance between its football heritage and modern governance capabilities”

The FA Chairman Greg Clarke, responding to the news of the Commons debate, defended the Association’s record in supporting and investing in the game. Indeed, it oversaw a record investment of £117 million in 2014–15.

Acknowledging that the FA’s governance needs improvement, Clarke argued that this does not prevent the organisation from supporting the game at all levels. This may be so, but it does prevent it from supporting the game in the best possible ways. The FA could certainly survive the withdrawal of public money and the Sports Minister has indicated that the funds would be made available to the grassroots via other channels. Yet it surely reflects poorly on the national governing body that it would be bypassed under such an arrangement.

The FA must strike a balance between its football heritage and modern governance capabilities. The two are not incompatible and the provision of effective decision-making by an appropriately diverse, representative, qualified and experienced leadership can sit alongside the preservation of the game’s roots and institutional memory.

Knock-on effects

The effects of poor governance can be hugely damaging. Commercial partners may weigh the potential reputational risk against the exposure gained from football’s popularity and decide that it is worth it. Or they may become wary of investing in an organisation whose own government (in the event of public funding being withheld) does not consider it to possess fit and proper governance arrangements.

FIFA lost a number of high-profile sponsors – including Sony and Emirates – at the height of its corruption scandal and, although no one specifically blamed FIFA’s ongoing problems, the timing seemed significant. Commercial impacts aside, some governance failures, by their nature or scale, cannot be ignored and some have very real and grave effects beyond sports politics.

Football has a somewhat captive audience in this country. History, tribalism, emotional investment and a love of the game will ensure that people play and watch every week. This must not be taken for granted. There is significant will to reform the FA. This will crucially needs to be felt in its decision-making bodies.

A good deal of valuable, committed and unseen work is done by FA members – including within its current structures – and this should not go unacknowledged. Football, however, deserves a governing body that does not become – as FIFA and the IOC previously became – a byword for poor governance.

Craig Beeston is Policy Officer (not-for-profit) at ICSA: The Governance Institute

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ICSA: The Governance Institute
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