Why ESG Is Becoming More Important To Sports

Olisa Agbakoba Legal (OAL)


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In an attempt to quantify and codify responsible investment practices, the United Nations coined the phrase environmental, social, and governance (ESG) in 2005.
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In an attempt to quantify and codify responsible investment practices, the United Nations coined the phrase environmental, social, and governance (ESG) in 20051. It refers to a set of standards for evaluating corporate performance that rate the strength of a company's governance framework and its capacity to efficiently manage its social and environmental repercussions. The disclosure of sustainability and social responsibility information is being used by boards, stock exchanges, and institutional investors more and more to investigate the connection between a company's commercial performance and its handling of ESG risk factors.

Focusing on ESG (environmental, social, and governance) challenges will shape the future of all industries. The domain of sporting activities and events is not an exemption2. The year 2020 saw the grand return of live sports that we had all been waiting for post covid19 with the Tokyo Olympics. Recycled and recyclable materials were used extensively, with athletes' beds made of cardboard, podiums made of plastic, and even medals made of electronic devices that had been previously used3.

It is definitely important to support and replicate these innovative advancements. In the grand scheme of things, however, they fall short of adequately compensating for the enormous environmental and social impact that sporting events have on the planet. Football's advocacy for racial equality through collaborations like Show Racism The Red Card and Kick It Out has demonstrated over the last ten years that sport has a significant societal impact and that organisations can effect change when they set their minds to it. What stops us from applying this same logic to sustainability?

It is difficult to evaluate the entire scope of the issue when sporting events are viewed in silos by athletes, associations, fans, and vendors. Because of this, the only way to find a solution is to evaluate the supply chain as a whole.

Also read: Demystifying Fees and Financial Compensation in Football Transfers

The influence of supply chain and sustainability challenges in sports is less well-known than in other industries, such as fast fashion4. In order to achieve sustainability and meet ESG targets, sports leaders and organisations need to take decisive action today, solve the existing issues, and make necessary adjustments to their supply chains.

The 2022 FIFA World cup hosted in the Gulf state of Qatar broke new grounds in terms of compliance with ESG standards, especially with regards to convertible waste products in the construction of the infrastructure used in the mundial. Al Janoub Stadium exceeded its intended certification for sustainable construction management and became fully operational, meeting its sustainable building certification for both design and build. The FIFA World Cup Qatar 2022 headquarters, located in Doha, is the nation's first office tower to be certified as a sustainable structure for operations and 16,500 workers on FIFA World Cup 2022 projects and 18,000 workers on other sites benefited from the SC's extension of its recruiting fees reimbursement program and ongoing implementation of its program to check compliance with its Workers' Welfare Standards across all sites5.

In the area, the first voluntary carbon offsetting initiative was launched.

Sports organisations are beginning to adopt sustainable practices to reduce their carbon footprint and environmental impact. This includes energy-efficient stadiums, waste reduction programs, and sustainable sourcing6. This brings to mind the recent incident of leakage at the Old Trafford, Manchester United's home ground, building sports infrastructure requires the employment of quality materials which is in compliance with environmental standards.

Global climate change has also caused disruptions to sporting events. The 2019 Rugby World Cup was impacted by unparalleled typhoons in the Pacific, while the Australian Tennis Open in early 2020 was plagued by smoke from the nation's bush fires7.

One quarter of English football grounds, namely Chelsea's Stamford Bridge, Fulham's Craven Cottage, and West Ham's London Stadium, are predicted to be vulnerable to yearly flooding within the next thirty years. Additionally, rising temperatures are predicted to make hosting summer tournaments more challenging in the near future8.

Climate change is having a momentous impact on sports, in 2019 two international races were cancelled in the U.S, due to its Western part's worsening forest fires which, fuelled in part by stronger droughts linked to climate change effects. Due to the effects of climate change, which include harsher heatwaves, more intense rain, increased fire hazards, and other threats, participating in or even just watching various outdoor activities is getting harder as the world gets hotter9.

"The global sport sector contributes the same level of emissions as a medium-sized country," states a Rapid Transition Alliance report10.

The Olympics in Rio in 2016 and the World Cup in Russia in 2018 are two instances of this, with 3.6 and 2.16 million tonnes of carbon dioxide produced, respectively. To fully understand this significant influence, one needs to consider the carbon footprint associated with the building and operation of athletic facilities (heating, air conditioning, and lighting), the transportation to and from events, and the manufacturing of athletic gear.

Sporting organisations have started looking at ways to adapt to the changing climate as heat waves hospitalise athletes in a variety of sports, including tennis and cricket, cancel tournaments owing to harsh weather, and make winter sports adjust to less snow and ice11.

Globally, sports arenas are taking up the problem of environmental preservation and setting out to drastically reduce their ecological footprint. This movement is a reflection of a global change towards sustainability, which is intimately aligned with environmental goals.

In addition to serving as exciting locations for sporting events, modern stadiums are also leading the way in environmentally conscious projects, inspiring millions of fans and establishing new benchmarks for environmental care.

Due to its capacity to promote ethical governance, foster community involvement, and spur sustainable growth, ESG has grown in significance within the sports industry. ESG-focused sports organisations are better positioned to prosper in a world that is changing quickly. Consequently, sports organisations, fans, the community and all stakeholders have a substantial environmental obligation by adopting sustainable practices such as renewable energy use, waste reduction, and eco-friendly transportation, sports organisations can significantly reduce their carbon footprint and promote environmental stewardship.


1. The United Nations Global Compact, 'Integrate the Principles for Responsible Investment' < Integrate the Principles for Responsible Investment | UN Global Compact > accessed 20 May, 2024

2. World Economic Forum, 'Here's why we must not lose sight of the importance of ESG, despite the recent backlash' < Here's why we must still focus on ESG, despite the backlash | World Economic Forum (weforum.org) > accessed 20 May, 2024

3. Jonquil Hackenberg, 'Why We Need To Make Sport More Sustainable' < Why We Need To Make Sport More Sustainable (forbes.com) > 22 May, 2024

4. Ibid, number 3.

5. The Annual Report of the FIFA World Cup Qatar 2022 < FIFA World Cup Qatar 2022" | FIFA Publications > accessed 24 May, 2024

6. World Economic Forum, 'Carbon offsets – how do they work, and who sets the rules?' < Carbon offsets – how do they work, and who sets the rules? | World Economic Forum (weforum.org) > accessed 24 May, 2024

7. SLR Consulting, 'ESG in sport: sporting clubs influencing the public on climate change awareness', < ESG in sport: sporting clubs influencing the public on climate change awareness | SLR Consulting > accessed 24 May, 2024

8. GiveMeSports, 'The History of Chelsea's Stamford Bridge (Complete Guide)' < The History of Chelsea's Stamford Bridge (Complete Guide) (givemesport.com) > accessed 24 May, 2024

9. World Economic Forum, 'Cancelled races, fainting players: How climate change affects sports'

< This is how climate change effects are derailing sport | World Economic Forum (weforum.org) > accessed 24 May, 2024

10. Rapid Transition Alliance Report on Global Sports Sector, < Playing against the clock | Rapid Transition Alliance > accessed 26 May, 2024

11. World Economic Forum, 'How can the Olympics respond to future climate change effects?' < How the Olympic Games is adapting to a hotter world | World Economic Forum (weforum.org) > accessed 26 May, 2024

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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