Patrick Moloney, Thomas Trier Hansen, Gustav Plantin
4 March 2024
The sports industry: A responsibility to behave responsibly
Combining professional sustainability capabilities with a passion for sports, our experts point to the sports industry as the next in line for more scrutiny and the need to take urgent sustainability actions across the industry. Here is why.
The call for sustainability has reverberated across all industries, prompting businesses to rethink their practices and their impact on the environment and society.
Currently, within the EU, the Corporate Sustainability Reporting Directive is a key driver. One industry that escapes closer scrutiny, however, is the sports industry. Despite daily media attention, significant influence, and global reach, the industry has yet to fully embrace its responsibility to behave responsibly towards sustainability. This article explores why sports organisations need to be held accountable for their actions in relation to sustainability and the compelling reasons for taking urgent action.
On occasions, athletes competing for gold will see their actual footprint put under scrutiny to determine if the jump will stand or a red flag will be raised. As an industry, there are certainly some red flags to be addressed – if not in a sprint, then at least at Olympic pace.
Here is the deal: From the construction of sporting infrastructure to the promotion of consumer goods through athlete endorsements, the sport industry’s footprint extends far beyond the confines of the playing field. Often overlooked, it relies on numerous sectors, including transportation, energy services, construction, waste management, food, hospitality, communications, and broadcasting, to name but a few.
As such, the industry’s (carbon) footprint should not be underestimated. Environmental impacts encompass resource depletion due to equipment and merchandise manufacturing, habitat degradation from facility construction, substantial energy consumption during events, and notable CO2 emissions from fan and athlete travel.
Ultimately, these impacts exacerbate the escalating climate change risks, posing an increasing threat to the communities deeply dedicated to supporting the industry's athletic activities. Similarly, the issues surrounding the industry's commitment to promoting human rights, fair labour practices, community development, accessibility, and diversity in all aspects of its operations highlight some of its most profound social impacts.
Beyond these footprints, the sports industry also exerts significant influence over consumer behaviour and societal norms. Athletes and sports organisations serve as powerful role models, shaping public opinion and influencing purchasing decisions. Accordingly, sports organisations need to recognise that their impact goes beyond showcasing athleticism or human achievement, and that they possess a vital role - and moral imperative – to reduce their footprint, advocate for sustainability and drive collective action towards a more environmentally conscious and socially inclusive future.
With a market size surpassing $488 billion in 2020 and anticipated growth to $614 billion by 2026, the sports industry emerges as a dominant force in the global economy. Within the European Union (EU) alone, the sports market boasted a value of approximately €200 billion in 2023, underscoring its significant economic contribution. This economic impact extends to employment, with over 7.5 million people employed in the sports sector across the EU – from athletes and coaches to event organizers and facility managers to manufactures.
In terms of global reach, few other platforms rival the sports industry. The interest for major sporting events keeps drawing massive audiences worldwide, as demonstrated by the 2022 FIFA World Cup, which engaged nearly 5 billion people across various platforms. Such events do not only captivate audiences but also drive tourism and generate significant revenue for host cities and local economies. The surging interest is further reflected in broadcasters' multi-billion-dollar investments for exclusive rights to live matches and competitions, along with the substantial sponsorship market, which surpassed $97 billion globally in 2022. Projections indicate that this market is set to double by 2030.
As the financial significance of the sports industry grows, so does its impact on people and society, presenting a unique opportunity for positive change. With its thriving growth and global reach, the industry holds the potential to champion sustainability initiatives and set a precedent for responsible business practices. Accordingly, by embracing sustainability and integrating it into all aspects of its operations, the sports industry cannot only mitigate its adverse environmental and social impacts, but also wield significant influence in inspiring sustainable change.
“Sports organisations need to recognise that their impact goes beyond showcasing athleticism or human achievement, and that they possess a vital role - and moral imperative – to reduce their footprint, advocate for sustainability and drive collective action towards a more environmentally conscious and socially inclusive future.”
First and foremost it is important to understand what the sports industry actually encompasses. The sports industry comprises several core components, each playing a distinct role in the overall ecosystem:
As the world grapples with pressing environmental and social challenges, the sports industry can no longer avoid the sustainability spotlight. The need for the sports industry to embrace its responsibility to behave responsibly is now under scrutiny not only due to its significant footprint but because the driver for change the industry can be. This need is underscored by the mounting regulatory pressures confronting sports organisations, such as the CSRD, signalling a critical juncture for transformative action. The industry now finds itself at a crossroads, facing rising scrutiny over its sustainability practices.
Here are some of the key areas to be mindful of:
Environmental impact of sporting events
Sporting events, from the Olympics to national tournaments, leave behind a substantial environmental footprint in terms of significant resource consumption, waste generation, and carbon emissions resulting from the extensive travels of athletes and spectators. Addressing these environmental impacts can decrease the ecological footprint, diminish the contribution to ecological degradation, and bolster the preservation of natural resources and ecosystems.
Social equity and inclusion
While sustainability efforts often focus on environmental issues, it is equally important to consider social equity and inclusion within the sports industry. Addressing issues such as human rights, fair labour practices, gender equality, and accessibility for persons with disabilities can help create a more inclusive and equitable sporting environment. By promoting diversity and inclusion both on and off the field, sports organisations can contribute to social cohesion and positive social change.
Influence on consumer behaviour
Athletes and sports organisations possess significant influence in steering consumer behaviour through endorsements and sponsorships, impacting purchasing decisions. By aligning themselves with sustainable practices as well as advocating for eco-friendly products, athletes and sports organisations can drive positive change and encourage sustainable consumption among their fan bases.
Platform for social responsibility
Sports have long served as a platform for social change and activism. Athletes have used their platforms to raise awareness about pressing social issues, such as racial inequality, LGBTIQ+ rights and other forms of discrimination. Similarly, the sports industry can leverage its influence to promote sustainability and advocate for environmental and social justice. By championing sustainability initiatives and supporting responsible policies, sports organisations can inspire action and foster a culture of environmental and social stewardship.
Long-term planning and resilience
Climate change poses significant challenges to the sports industry, including extreme weather events, rising temperatures, and changing environmental conditions. Sports organisations must adopt long-term planning strategies and build resilience to climate-related risks to ensure the continuity and sustainability of their operations. This may involve investing in climate-resilient infrastructure, implementing emergency preparedness measures, or incorporating climate change considerations into strategic decision-making processes while still ensuring a just transition.
Leadership and innovation
The sports industry has the potential to be a catalyst for innovation and technological advancement in sustainability. From renewable energy solutions to eco-friendly materials, there is ample opportunity for sports organisations to lead by example and drive innovation in sustainable technology. By investing in research and development and collaborating with stakeholders across sectors, the sports industry can pioneer new solutions to environmental and social challenges and inspire other industries to follow suit.
An economic imperative
Embracing sustainability is not just a moral imperative but also an economic necessity for the sports industry. As consumers and customers increasingly prioritise sustainability in their purchasing decisions, businesses that fail to adopt sustainable practices risk losing market share and facing reputational damage. This also applies to the sports industry. By investing in sustainability measures, such as energy-efficient infrastructure, waste reduction strategies and human rights due diligence, sports organisations can improve their bottom line while minimizing their negative environmental and social impact. More importantly, however, sustainable brands are attractive to sponsors.
By addressing these issues, the sports industry can further enhance its commitment to sustainability and contribute to building a more resilient, inclusive, and sustainable future for all.
In conclusion, it remains clear that the sports industry bears a profound responsibility to behave responsibly. Recognising its impact extends far beyond the playing field. There are numerous ways the industry can contribute to a sustainable future. These include identifying, managing, and reporting environmental and social impacts throughout the value chain, promoting sustainable consumption, advocating for social and environmental justice, and forming partnerships for sustainable change.
By embedding sustainability into their core values and operations, sports organisations can not only reduce their impact on people and the planet but also catalyse positive change and set a precedent in the global battle against climate change, ecological degradation, human rights violations, and irresponsible business conduct.
Like a full crowd watching a footballer step up to the penalty spot, increasing legislative scrutiny is now upon sports organisations - especially via the CSRD. As a result, it is imperative for the industry to hammer it home and embrace its role as a steward of the planet. This imperative extends beyond mere morality – it will be a necessity.
Stay tuned for our next article where we will focus upon the value that sustainability can create for clubs and associations within the sports industry to be soon followed by what the CSRD means for the industry.
Want to know more?
Patrick Moloney
Director, Strategic Sustainability Consulting
+45 51 61 66 46
Thomas Trier Hansen
Chief Advisor
+45 51 61 23 59
Gustav Plantin
Analyst, Ramboll Management Consulting
+45 60 36 17 71