Business Advantages of Supporter Community ... - Supporters Direct

2 FinanceKey Question:Has supporter community ownership helped the club be financiallystable in ways that it would not if it were privately owned?Top Three Findings:i) The consensus of clubs was that supporter community ownership bringswith it an added onus to be financially responsible and live withintheir means, and that in this sense supporter community owned clubsare more likely to be financially stable than those in other forms ofownership. Two thirds of supporters of surveyed clubs also felt that theywere provided with all relevant financial information.ii) In addition, supporter community ownership allows clubs to raisefinance in other, more innovative ways. A leading example of this isthrough ‘Community Shares’ – the issuing of non-voting shares in aCommunity Benefit Society (the corporate structure for all supporters’trusts) something discussed further under facilities, below, and inSupporters Direct’s Briefing Paper No.3 on raising finance.iii) However, all clubs felt that whilst supporter community ownershipentails an additional check and balance against unsustainable levels ofdebt and overspending – through open membership, democratic shareownership, elected boards and a legal objective of financial prudence– this put them at a competitive disadvantage to other clubs that weremore likely to do this.Clubs interviewed believed that financial health was not on the wholedependent on the good will, soft loans or benefaction of an individual,family or private consortium: and a longer term approach to thedevelopment of clubs was evident. The CBS structure means that it ismore difficult to use equity in clubs in return for financial borrowing; andmore difficult (if not impossible) for clubs to go into administration, makingfinancial prudence and developing long term revenue stability paramount.Andy Walsh, General Manager, FCUM, outlined the longer term approachadopted by supporter community ownership:‘If the club were privately owned, the stability of the finances in the short termwould depend on how much the individual or consortium were prepared to investin the club; but in the long term, any private investment that’s not backed up byBusiness Advantages of Supporter Community Ownership 13