Focus on purpose to reap the rewards

^{This article was submitted as part of our call for reshaping the future of sport and development.}

The last few years have thrust unavoidable change on people, society, and consequently, sport. The emergence of the COVID-19 pandemic has shaken sport and its event-focussed, membership-based business model to the core, and it continues to be a powerful accelerant of change. And while change imbues fear, David Bowie got it right when he sang “turn and face the change”, as this also offers great opportunities.

A focus on purpose

It’s almost as if the recent forced disruptions have created an existential crisis for sport which has lasered a focus on the ‘higher purpose’ of organisations – why they exist, and what their impact is on individuals and society. COVID-19 and its effect on the sporting landscape has emphasized more than ever that sports need to be able to clearly demonstrate and communicate the role they play outside of regular competitions and major events.

There are many national and international organisations that are turning their attention to this area. For example:

• The new International Olympic Committee (IOC) strategic roadmap, Olympic Agenda 2020+5, approved by the IOC Executive Board, includes the need to achieve sustainable development and strengthen the role of sport as an important enabler for the United Nation’s Sustainable Development Goals (17 Global Goals adopted by the UN in 2015 as a universal call to action to end poverty, protect the planet, and ensure that by 2030 all people enjoy peace and prosperity).
• In 2021, the Commonwealth Games Federation (CGF) announced they were now far more than the curator of a great Games. Away from sport, much of the activity within the Commonwealth movement is now aimed at addressing social issues. The CGF supports and highlights its three core values of humanity, equality, and destiny, and aims to promote fairness, non-discrimination, and inclusion all year round.
• The International Paralympic Committee (IPC) have continued an increased push to use para-sport to advance the human rights agenda for persons with disabilities and promote social inclusion. The IPC Strategic Plan (2019-22) states:

“There is no escaping the fact that the Paralympic Movement’s work has a significant and profound impact on society. A particular area in which we can witness the power of the Paralympic Movement is in how we advance several of the Sustainable Development Goals (SDGs) which are designed to achieve a better and more sustainable future for all.”

Embedding social inclusion practices and programs across sporting organisations is no longer ‘the right thing to do’ – the business and development opportunities associated with getting it right make it an imperative. The Australian Government’s 2030 National Sport Plan, National Disability Strategy and State/territory sport and health plans (including QLD Government’s Activate! Sport and Recreation plan – 2019-2029) all highlight the need for strategies to focus on social inclusion and diversity, and promote physical and mental health in the community.

Most major sporting organisations in Australia have community programs that are dedicated to using the reach of their sport and role models to contribute to purposeful social issues in their communities. These programs provide a range of community, business and growth opportunities that can be linked to strategic objectives around pathways and participation, image and brand, social inclusion, revenue, and governance. Social initiatives can also assist with resolving labour shortages (employing people with disability); improving staff loyalty and retention; enhancing business reputation; improving innovation and decreasing related regulatory and compliance risks around equity and discrimination.

The rise of purpose-led partnerships and impact investing

In recent times, many progressive and savvy sporting organisations have been conscious of this ‘shift’ and have adjusted their stakeholder and commercial strategies in recognition of the rise of purpose-led partnerships. They clearly understand that sponsors and partners are now very conscious of consumer sentiment, creating a larger emphasis on purpose and value alignment, and offering an ‘always-on, year-round’ opportunity of engagement. Recent reports and funding focus support this trend, for example:

• Philanthropic funding in support of the Sustainable Development Goals has been shooting up every year since their adoption, and funders are increasingly collaborating to chart their investments and global progress towards the goals. Between 2010-15, foundations worldwide spent an average of $34.3 billion annually on global initiatives that aligned with SDG goals. That number increased considerably following the adoption of the SDGs. Between 2016-19, foundations spent an average of $39.8 billion annually ($159 billion total).
• In 2020, the Global Impact Investing Network (GIIN) estimated the current size of the global impact investing market to be US$502 billion (and an updated estimate in 2021 of US$715 billion [$A1.04 trillion] improves upon the rigorous methodology of its previous figure). The GIIN report found that investors were starting to all use the same measurement frameworks, such as the SDGs, which 80% of respondents reported using.
• Impact investing for social and environmental impact is rising dramatically in Australia. The Responsible Investment Association of Australasia survey found impact investing had tripled from 2017 to 2019 from $5.7 to $19.9 billion and forecast to grow fivefold. Impact investment products targeting social outcomes have increased AUM tenfold to $2.5 billion.
• PWC’s SDG Reporting Challenge 2019 report found that 72% of companies reference SDGs in their corporate or sustainability report, while 90% of investors believe impact investing will become a more significant part of the investment landscape.

Major sponsors of sports around the world are increasingly using the SDGs as their business roadmap to success. Sports executives are using this new language “as an easy way to identify a sponsors’ objectives creating a brilliant shorthand guide for corporate partnerships executives to hone their pitches and identify new prospects”. A review of the websites of the top 25 spending brands across sports reveals the ‘Global Goals’ are consistently and broadly used by all of them, and hundreds more beyond those top advertisers and in every major sports market.

In CSR: The Powerful Sponsorship Trend of 2021, Ken Ungar says: “Before the pandemic, consumers began to reward companies who acted in a socially responsible way. 87% of consumers would purchase a product because a company advocated for an issue they care about, and 76% would refuse to buy a company’s product or service upon learning it supported an issue contrary to their beliefs”. He adds: “The pandemic formed a more common purpose for consumers and, in the economy, elevated the very idea of a company’s ‘purpose’. Consumers began to express strong opinions that brands should live their values and promises.”

The pandemic has accelerated change at all levels in sports organisations around the world. Consumers used to reward companies that act conscientiously – now consumers expect that companies act responsibly. A 2018 global study by Havas Sport and Entertainment found millennials, in particular, are now actively seeking brands that are looking to positively contribute to society. They are demanding “don’t just sell me something, solve a problem”. Brands who are meaningful and viewed as making the world a better place are outperforming the stock market by 134%.

With sports in Australia being advised to diversify their funding base to rely less on government grants and support and investigate new, sustainable sources, it makes sense to turn and face the inevitable change and embrace the opportunities that social inclusive strategies and purpose-driven partnerships offer.

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Dr Paul Oliver is an advisor to many Australian sports and Governments on safeguarding, inclusion and integrity matters. Read his PhD on the ‘Power of Sport: Building social bridges and breaking down cultural barriers’. He can be found on Twitter and LinkedIn.