Stewardship and football

by Mark Goyder Look at any well-run private or family business. You find a close alignment between the owners of its shares and the board and the senior people running the business. There are vigorous conversations going on in which the owners challenge the managers about past decisions and future directions. Views differ, but there is a shared commitment to the long term success of enterprise. In these companies accountability works and so do incentives. Then look at our publicly quoted companies, the ones listed on our stock exchange. Something is missing. CEOs find it difficult to take managers into their confidence. Many of the investors do not think it is their task to hold CEOs to account. Non executives are criticised for not spending enough time or effectively holding the business to account. What is missing, in our view is stewardship. The sense that the board and owners between them are entrusted with a responsibility to hand the business on in better shape than they found it. So our project is developing a set of stewardship principles that would apply to both investors and boards, and a scorecard to help us distinguish between the good and bad stewards. When we were arguing about the criteria, it was very helpful to think of examples that everyone knew about. So the conversation turned to football clubs. And hence the emergence of our first tentative public scorecard – an assessment of all the clubs in the UK’s Premiership. You can tell the difference between the clubs whose owners clearly feel they are custodians for the future, and the clubs whose owners have bought them as an exercise in vanity, or are loading them up with debt. It is all very well to give the fans big money stars and results today. What about the youth policy, the stadium development, the local community that will provide the support.  How is the club balancing tomorrow with today? We want it to get football fans arguing about stewardship. We want it to get people everywhere thinking about stewardship as something they should expect to be exercised by their pension fund and life insurance company. Stewardship matters if we want a more visionary, a more responsible, and amore enduring set of businesses. Contact me if you too care about stewardship.