As the owners of the world’s richest football clubs battled to overcome the fallout from the ill-fated European Super League (ESL) – another global initiative of far greater significance was being born.
Also led by some of the wealthiest institutions on the planet – but announced to significantly less fanfare – the Glasgow Financial Alliance for Net Zero (GFANZ) was launched by leading government and finance figures. This alliance of some of the world’s most powerful banks, investors and pension funds comes together with a mission ‘to accelerate the transition to net zero emissions’.
With $70 trillion at play – the stakes for our planet, our futures, couldn’t be higher.
To ensure this Financial Super League delivers where the ESL failed, here are five lessons from the football industry which government and the finance industry must learn from:
1. Listen to your (G)Fans: the ESL was doomed the minute fans turned their backs on their own teams. Neither consulted nor prioritised, countless supporters took to the streets to express horror that their club could be so out of touch. Banks, Pension Funds and Investors should heed this lesson – your everyday customers are your key stakeholders. They are the real asset owners of our economy, and as custodians of their money, there is a duty to ensure their voices are heard. And on climate, that voice is loud and clear: they want action, not words.
2. The power of regulation: according to many, the Super League was stopped in its tracks as Boris Johnson threatened to drop a ‘legislative bomb’ on the key protagonists. The Prime Minister should show the same energy and enthusiasm to regulate our financial institutions – ensuring that appropriate legislative and regulatory frameworks are in place to help them deliver on their ambitious plans. The government’s support for the Alliance will help amplify; regulation will help deliver.
3. Put people and planet on a par with profit: part of the vitriolic reaction to the ESL stemmed from the unabashed profit-seeking of the club’s owners. This approach damaged reputations and ignored the communities to whom they owe so much (not to mention tanking their share prices in the process). The same lessons must be applied to financial institutions – short term, profit-at-all-costs measures won’t work, neither as a means to to keep customers happy, nor as viable financial strategies. People and the planet must be placed at the heart of all investment decisions.
4. Do your homework: no one who glanced over the leaked details of Sunday’s ESL announcement could possibly have thought that sufficient preparation, planning or consultation had gone into the proposals. And within 48 hours, they collapsed. Financial institutions setting Net Zero targets must not make the same mistake. Commitments must be ambitious, robust and front loaded. That means annual reporting against emissions targets (starting right now), immediate phasing out of coal, and a halving of emissions before 2030. In this regard, lessons can be learned from the ambitious commitments made by many in the pensions industry over recent months
5. Accountability is key: finally, it’s not ok that teams could not be relegated from the ESL, regardless of performance. In the same way, the idea that financial firms can sign up to targets but not have to perform against them will drive stakeholders to distraction. Our financial institutions need accountability – people who don’t perform need to be relegated, and those that excel must be promoted so consumers have a fair benchmark. When everyone’s in the Super League, and no one can be relegated, how can you possibly tell good from bad?
Ultimately, GFANZ needs to invest in a future people actually want, not one which perpetuates a status quo. As exciting as watching my beloved Arsenal play Real Madrid may be, the idea of watching that same fixture 27 years running begins to lose its gloss. People across the UK – across the globe – want their money to matter. They want their money invested in building a world they actually want to retire in. It’s time for our financial industry to heed that call, and build a better future.
David Hayman, Campaigns Director