The evolution of professional sport demonstrates a growing trend towards stakeholders having more power to set an influential discourse aimed at increasing the application of sound principles of governance and commercialisation, inspired by concepts such as transparency, good governance and good corporate citizenship, CSR and sustainability.
From athletes and brands with a corporate focus to increased activism in the sports economy
At the individual athlete level, this evolution has triggered a paradigm shift for sports branding, in which some athletes have made a successful transition from primarily having a corporate focus to today exhibiting increasing involvement of athlete activism. Michael Jordan, who set new standards for sports branding back in the 1990s in particular, exemplifies an athlete with a corporate orientation and thus an athlete with a high level of strategic and commercial awareness. In contrast, Colin Kaepernick is a recent example of athlete activism. Kaepernick made a strong mark in terms of athlete activism by sacrificing his career as a professional American football player for the San Francisco 49ers in the NFL in favour of a greater cause and thus the fight for social justice in American society.
What about the WTA and Peng Shuai case?
With this paradigm shift in mind and in the wake of a lot of unresolved issues related to the Chinese tennis player Peng Shuai, it is not surprising that the WTA cancelled its tournaments in China. Peng Shuai's public invisibility and various questions about her safety came after she accused an official of sexual assault through her SOME platform (which has now been deleted, by the way).
Commercial navigation in a difficult landscape
Earlier in 2019, the then 'General Manager' of the NBA team Houston Rockets, Daryl Morey tweeted in support of protesters in Hong Kong. The league's global face, LeBron James, was in China to promote basketball and the NBA via exhibition games. James stunned many current basketball fans and people in Western democratic societies on that occasion by saying that speaking his mind would not help much compared to a key statement from the NBA. According to ESPN, James also said that it was not the players' responsibility to discuss a complex situation with racial, socio-economic and geopolitical layers while visiting China and playing exhibition games. So, like Michael Jordan in the 1990s, James stands out as an athlete with a corporate focus who is aware of the importance of Chinese power, both politically and market-wise, while perhaps having a different personal view on human rights and democracy.
Professor Stephen A. Greyser of Harvard Business School*, a recognized expert on the intersection of sports management and stakeholder management, notes that:
Sacrificing the big check is a powerful narrative
WTA's decision to be politically conscious is 'the right thing to do' from an ethical and moral perspective. Despite putting hundreds of millions of dollars in revenue at risk. Commercialization is essential in a professionalized sports landscape, but in my opinion not at any cost. The WTA has recently signed a long-term host city agreement with Shenzhen (running until 2030), which symbolises a rarely long and financially fruitful agreement with a host city. The Shenzhen deal alone accounts for $140 million in prize money over a ten-year period. Along with that come Chinese commitments to other tournaments and investments in stadiums and/or arenas. These investments also create media deals in the huge Chinese sports fan market and represent a lucrative opportunity for the WTA to bridge to corporate brands and thus to sponsors from China, the US and other markets looking to build market relevance in China. Therefore, it is a strong message that the WTA is sending to China and the rest of the world.
Professor Greyser adds:
The substantial financial outlay for the WTA is a new and very welcome signal in the hyper-commercialised world of sport, where other major federations and/or governing bodies have missed the goal of navigating with a moral compass and thereby expressing good citizenship. Instead, they have gone for the big cheque without thinking about what comes with it.
Porsche's influence and market relevance
The end-of-season finalsin Shenzhen are a strong revenue stream for the WTA. One of the tournament's main sponsors, Porsche, is investing similarly in tennis. It forms a strong link between the affluent as well as the affluent consumer profile of global tennis and China as the world's largest market for the German luxury car manufacturer. In 2020, Porsche delivered 88,968 vehicles to China.
WTA sets a new agenda and differentiates itself
A look at the history of the WTA makes clear a 'value proposition' related to supporting women's sport. It testifies to gender equality and thus founder Billie Jean King's attempt to ensure a level playing field with equal opportunities. The WTA therefore has no choice but to stand firm and strong on this issue and demonstrate a zero-tolerance policy. The WTA is definitely pushing the boundaries in a country context characterised by a totalitarian system of governance, while underlining the importance of giving women in sport a stronger voice. Remaining silent on allegations of sexual assault is morally wrong, but would also conflict with the premises of the WTA's existence and its prominent role as a powerhouse for women's sport worldwide and a platform for empowering women.
The timing of the event is interesting given that China will soon become the first nation to have a city (Beijing) that has hosted both the Summer and Winter Olympics. It is taking place at the same time as other prominent tennis names such as Serena Williams, Naomi Osaka and Martina Navratilova have expressed their support for Peng Shuai. This adds weight to the WTA's reaction and huge show of support for Peng Shuai, given the superstar status of these athletes and the fact that women's tennis is the number one sport when top female athletes are ranked according to their ability to capitalise on their sporting careers.
Stephen Greyser highlights the importance:
The WTA, on the other hand, has entered a new era as a frontrunner in this situation. Therefore, I look forward to the reactions and actions of other federations and sports industry leaders (and the associated commercial stakeholders) in relation to the 2022 Winter Olympics and to deal with China. In an analogous situation, there has been much public criticism in Denmark of the FIFA World Cup in Qatar over human rights challenges. However, China is a superpower in international politics and trade, so this case may well turn out differently. Unfortunately, where there is money, there is often greed, which can tend to blur moral judgement. But it will be interesting to see how it develops.
* This article is written by Kenneth Cortsen, MSc, MBA & PhD in the intersection of sports economics, sports management and sports branding from Aarhus University and elite football coach (with UEFA A license and since January 2014 associated with AaB where he has led the women's team from third best level to the Women's League in the summer of 2020). Kenneth is co-founder of the professional bachelor program in sports management in Denmark with teaching and research on a daily basis at the University of Applied Sciences UCN in Aalborg. In addition, he lectures and guest lectures in various places abroad, including the University of San Francisco, SAWI Lausanne, Vlerick Business School in Ghent and the Johan Cruyff Institute in Amsterdam and Barcelona. He is also the co-author of the book SPORTS MANAGEMENT - Management and Commercialisation in the Sports Industry, and is involved in strategic consulting, advisory boards and board work related to sport. Since 2010 he has also been on research environment shifts abroad, collaborating extensively with Professor Stephen A. Greyser of Harvard Business School, who is featured in this article.