The economic framework surrounding football and its complexity

Stephen Morrow - Master in Football Business in partnership with FC Barcelona

Interview with Stephen Morrow, specialist in account, finance and the governance of professional football, and professor of the Master in Football Business in partnership with FC Barcelona

Stephen’s Morrow’s academic background is in account and finance. As part of his undergraduate degree at Heriot-Watt University, he did his honours year dissertation on the capital structure of Scottish football. While that does not sound unusual today, back in the 1980s, very few people were showing any interest in the business and governance of professional football, in Scotland or elsewhere. After completing his CA (chartered accountant) qualification, he returned to Heriot-Watt as a lecturer and began to focus his research activities on accounting, financial and governance aspects of professional football. Stephen published his first book The New Business of Football in 1999.

Could you please tell us about your research work on football?

My work has encompassed studies on accounting aspects in football (e.g. the treatment of players as assets), on CSR, on the role of the football manager, and on ownership and governance in professional football clubs. Some years ago, I received a Havelange Scholarship to study ownership and governance in European football clubs, and these case studies contributed to my book The People’s Game? Football, Finance and Society published in 2003. Much more recently, I have just published a paper in the Journal of Sport Management (with Andrew Adams and Ian Thomson), entitled ‘Changing boundaries and Evolving Organizational Forms in Football: Novelty and Variety among Scottish Clubs’, in which we seek to use boundary theory to understand the evolution of football clubs’ ownership, financing and governance practices.

What are your views on the current state of the football business worldwide?

The current state of the football business worldwide is something of a paradox. The growth in revenues and in worldwide interest in football of course demonstrates a successful and lucrative industry. But at the same time, these high level good news stories also mask a number of problems such as financial inequality between leagues (and clubs) in different countries, between leagues within countries, as well as related issues around player salary levels and financial leakages through, for example, apparently excessive agents’ fees. It will also be interesting to see how the emergence of the Chinese Super League and its financially and politically powerful clubs impact on the established European football business order.

What are the main trends and what changes are needed if any?

In my opinion, regulatory initiatives like financial fair play are to be welcomed and have contributed to improved financial management among clubs, and to improving clubs’ financial discipline and rationality. But at the same time, attention needs to be afforded to the distribution of revenues and to resultant issues of competition, both at national levels but also in transnational competitions like the Champions’ League.

There is increasing money in football due to new broadcasting deals. Is this a trend that you expect to continue for long? What will be the impact on the business overall?

I hesitate to answer this, having confidently stated some (many!) years ago that we wouldsoon be reaching the point when media rights and broadcasting deals had peaked. Wrong, wrong, very wrong! That said, the escalation in rights cannot continue indefinitely and it is essential that clubs and leagues begin to consider the consequences of any diminution (or even rights income stabilizing) rather than simply reacting to it when it happens.

Master in Football Business

in partnership with FC Barcelona

The main objective of the Master in Football Business in partnership with FC Barcelona is to educate with in-depth and up-to-date knowledge and insights from the football industry. Students will analyze the core theories and relevant case studies that will help them visualize the behavior of the football business. Students will also have the opportunity to learn, interact and contribute with FC Barcelona business strategy and operations.

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