The relationship between governance structure and football club performance in Italy and England
Sport, Business and Management
ISSN: 2042-678X
Article publication date: 4 October 2019
Issue publication date: 6 April 2020
Abstract
Purpose
The purpose of this paper is to verify the theoretical assumption about a weaker role of internal governance structures (namely, board and CEO) in determining sporting and financial performances in highly concentrated club ownership environment.
Design/methodology/approach
Using data from the Italian and English football clubs playing in their national top divisions, over the period 2006–2015, the authors apply agency theory, property rights theory and win maximization logic to test the absence of a significant impact of internal governance structures on financial performances and clubs’ sporting performance. Ownership structure’s variables are used as control variable.
Findings
Empirical findings document an overall poor impact of board structure and CEO features on financial performances, in comparison with the influence of ownership structure; the consolidation of win maximization logic of clubs’ owners has been demonstrated in this specific context. However, the authors found that some internal governance elements have also an impact on performance even if their contribute is limited: board size results negatively associated to club profitability, board independence and CEO tenure are positively related to sporting performance; in addition, CEO tenure also increases profitability.
Originality/value
The originality of the paper lies on the contribution arising from this empirical research, since a scarcity of empirical studies analyzing the correlation between internal governance and performance in European football sector is noticed.
Keywords
Citation
Ruta, D., Lorenzon, L. and Sironi, E. (2020), "The relationship between governance structure and football club performance in Italy and England", Sport, Business and Management, Vol. 10 No. 1, pp. 17-37. https://doi.org/10.1108/SBM-10-2018-0081
Publisher
:Emerald Publishing Limited
Copyright © 2019, Emerald Publishing Limited