Selected Issues of (Good) Governance in North American Professional Sports Leagues

• Published in: Journal of risk and financial management Vol. 15; no. 11; p. 515
• Main Authors: Morales, Nelson, Schubert, Mathias
• Format: Journal Article
• Language: English
• Published: Basel MDPI AG 01.11.2022
• Subjects: Accountability; Corporate governance; Decision making; Democracy; Ethics; International finance; Professional sports; Qualitative research; Transparency; North America
• ISSN: 1911-8074; 1911-8066; 1911-8074
• DOI: 10.3390/jrfm15110515

In recent years, sport governing bodies (SGB) have been the subject of serious questions regarding their governance structures and decision-making processes. SGB that fail to implement regulatory mechanisms and to improve their governance structures and processes risk being confronted with severe ethically sensitive issues outside and inside the fields, which may eventually result in negative publicity and reduced demand (e.g., fans, sponsors) or financial support (e.g., from governments). This study examines selected regulations and practices of North American professional sports leagues in light of good governance principles. By adopting a qualitative research design, we investigate if there is a need for reforms to be employed by the leagues to comply with core dimensions of governance and thus reduce the risk of not being prepared to deal with ethically sensitive issues that may come up. Our critical analysis suggests that essential reforms need to be employed by the leagues to comply with core principles of good governance. In terms of democracy, professional leagues need to recognise stakeholder interests, implement innovative participation mechanisms, and apply diversity and inclusion policies for board composition. On transparency, it is required to publish internal regulations and financial information despite lax regulations on disclosure policies in the United States. Concerning accountability, professional leagues should separate their disciplinary and executive branches to avoid the concentration of power and potential conflict of interest in the relationship between the commissioner and team owners.