Sustainability Report for Sports Direct

1. Introduction to Organization:

The organization selected for this project is “Sports Direct”. Sports Direct is among the best sports retailer of Britain. Sports Direct is European distributor of sportswear, fitness and fashion products from internationally recognized brands i.e. Adidas, Nike, Puma and Under Armor. The company is offering matchless breadth and depth of products with best prices. It has 700 stores operating in UK and in continental Europe among which 427 are under Sports Direct.com Fascia. The Company has a premium lifestyle market targeting UK through 83 stores under Cruise, Flannels, USC and Van-Mildert Fascia. The company’s sports, lifestyle and fashion portfolio is globally recognized. The main operations of company are selling core product to wholesale customers and licensing plans throughout the globe. The company interacts with multi-lingual customers accepting multi-currency using online/ e-commerce platforms (Sports Direct, official website, 2017).

Sports Direct has a CSR framework that focuses on five key areas i.e. Health and Safety, People, Environment, Community and Customers. CSR initiatives of Sports Direct monitored using KPIs ensure its performance. However, this report will discuss the CSR trends in sports industry using literature review and evaluate the changes required by the selected organization. The report will offer practical implications and future directions related to sports industry particularly focusing Sports Direct.     

2. Literature Review:

2.1 Sustainability and CSR concept:

Corporate social responsibility or sustainability emerged in 1950s, which offered a broad range of prospects for business organizations to focus for achieving long-term sustainability. Social responsibility or otherwise known as corporate responsibility, corporate social response or responsiveness and other terms like citizenship and social performance is a pervasive debate that focuses on corporate strategy, management areas and long-term goals of corporate (George, 2007).

2.2 Sports Business Objectives of Sustainability

CSR scholars explored the basis of existing management and business knowledge and originated the themes of CSR. These key themes of CSR include the perspective of social, economic or environment, financial and philanthropy that emerge various management perspectives such as marketing as social cause, social obligation, stakeholder relationship management, leadership role and themes and other integrated strategies of business (Levermore, 2013; George, 2007).    

With the wide spread focus on CSR, companies from every industry or areas are focusing on maximizing profits on basis of CSR initiatives. The companies are aligning the CSR objectives to key strategic objectives that offer them repute and profits in return (PAINE, 2009). In todays, drastically changing business scenarios, responsibility of a business assumed to be a core competitive advantage (Athanasopoulou and Selsky, 2015). Companies view CSR and sustainability objectives as alternative to increasing repute, maximizing profits and building a strong repute and image. Meanwhile, the professionals of sports and health experts are facing increased sustainability and responsibility challenges such as “growth of inactivity among people and costs in grass root competitions”. This leads to focus the relation between the sustainability and sports industry and viewing the phenomenon of CSR in Sports industry (Levermore, 2010).  

2.3 Examples of Sports Business for CSR initiatives:

From research and theories, the relationship between sustainability/ corporate responsibility and sports has two implications. First, the companies and organizations not involved in sports business can utilize it as a vehicle to display the CSR strategies. The integration of non-sports with sports aimed at attracting customers and stakeholders leads to enhance the image of companies and improving the brand perception and repute (Filizöz & Fisne 2011). An example of this implication comes from Vodafone, a telecommunication company that implemented CSR program in 2007 promoting healthy and positive living among youth (Levermore, 2013). One success story of Vodafone is collaborating with “Homeless World Cup” aiming to bring homeless people to annual football tournament from around the world. Vodafone created an exceptional example by highlighting significant social issue and needs of homeless people (Salcines, et al., 2013).      

Other significant collaborations for sports and non-sports business for CSR initiatives include Barclay Bank’s “Spaces for Sports Program” aimed at proving specialized and expert coaching services and trainings to under privileged areas. Similarly, Coca Cola’s Special Olympics for special need children who could participate in different competitions. These examples are driving world towards social responsibilities and comprehending the ignored aspects and needs of society (Salcines, et al., 2013)

Another implication of CSR from literature research drives attention CSR initiatives within sports organizations. The second implication is within sports business aims to encourage the global stakeholders and sponsors. This implication relies on moral obligations of sports business collaborating with or driving focus of sponsors towards good something good for society. This will increase the company’s repute, image, increasing fan base and profits (Athanasopoulou et al. 2011).   

The leading successful example for second implication is the CSR program of FIFA Football for Hope. The aim behind this program was to achieve the social development through funding power of football, coaching and training facility building and providing free equipment. Similarly, Adidas has made product and financial donations through Adi Dassles Fund for encouraging volunteer program participation among young employees (Filizöz & Fisne 2011).

2.4 Justification of Sustainability Initiatives:

Sports management is a significant business management area where the growing focus of scholar is towards the way in which sports industry incorporates societal benefits (Ratten and Babiak, 2010). CSR refers to the ethical behavior of company beyond the legal obligations (Filizöz and Fişne, 2011). With perspectives of going beyond legal obligations, the CSR culture continues to grow among sports companies in recent years.     

The unique ability of Sports of mobilizing an attracting the customers has inbuilt values for example, team work and opponent’s respect (Levermore 2010). Sports spread the concept of ideal life quality and promote peace making through connecting people or bringing together the cultures and ethnicities, consequently resulting in social and economic bridges between nations and people. The social, economic and physical values of sports industry directs toward life lesson teachings that are crucial for individuals (Smith & Westerbeek 2007).

According to Levermore (2010: 2013), as sports becomes dominant financial and social organization across the world, it is vital to comprehend its potential and restrictions as an apparatus in building a superior society. (Levermore 2010) On the other hand, don based CSR has additionally its dangers and restrictions. Incapacitating, winning at any value, viciousness and awful direct of players are clear in today’s game scene. Football hooliganism and match settling are different cases of stressing patterns in the worldwide games. (Levermore 2010) It is likewise essential to understand that game is only one approach to actualize organization’s CSR procedure. As opposed to “green-washing” through unmistakable advancements, organizations ought to focus principally on nature, monetarily and socially supportable business forms that do not convey damage to its environment (Godfrey, et al., 2009)

Game and business have discovered approaches to cooperate towards social change (Wilson 2011). As indicated by Ratten and Babiak (2010), social duty in game can even be a standard business issue. Besides, without the support of corporate accomplices, the estimation of game as an impetus for social duty is constrained (Smith and Westerbeek 2007). Organizations can partake into feasible improvement by contributing their assets, bits of knowledge and experience (Levermore, 2013). Separately, game is financially, socially and socially essential and getting it done, empowers social cash flow to develop in the group by means of partners and co-operation with them (Ratten and Babiak, 2010).

2.5 CSR benefits to Organizations:

CSR has progressively been distinguished for its capability to make a level of upper hand, which is an objective of any association (Plewa and Quester 2011). Keeping in mind the end goal to keep up the preferred standpoint, the association must separate itself from its rivals (PAINE, 2009). Other than incorporating urgent social values and doing useful for the group, social obligation can make a road for separation. It is evident that the more noteworthy an organization’s commitment to social welfare, the better its notoriety. The qualities got from having a social duty point of view incorporate additionally expanded client goodwill (George, 2007).

Godfrey, Merrill and Hansen (2009) have exhibited that interests in CSR create protection like advantages to firms. As indicated by Paine (2009), organizations get included into CSR because of risk administration, institutional significance, hierarchical working, and showcase situating and moral presumptions. In addition, George (2007) distinguished three key drivers of executing CSR:

1) Development of core value framework that demonstrate the company’s monetary objectives aligned to social responsibility  

2) CSR as the way to organizational development strategy

3) Pressure of Public from purchasers, government and media, requesting organizations to be socially responsible (George, 2007)

Corporate network of responsibility called “FIBS (Finnish Business and Society)” is a non-benefit corporate in Finland. They have directed a corporate duty investigate that had 201 respondents from Finnish organizations. In light of the examination, the lion’s share (71 %) of the organizations say that duty is profoundly applicable to their business, and significantly more imperatively, 46 % say that obligation is at the focal point of their business. As per FIBS (2014), the advantages of being dependable are a successful risk administration, increment of prosperity and wellbeing at work, diminished expenses and expanded income. Being mindful can likewise help organizations get financing and open new roads into new markets.

It is essential to characterize the CSR technique in view of the long haul objectives of the organization with a specific end goal to make an effect. In the advanced age with online networking and other viral apparatuses, the endeavors of “green-washing” turn out to be rapidly evident. Organizations ought not to go out on a limb of risking the picture they have by adorning their obligation demonstrations. As indicated by FIBS (2014), one of the conceivable outcomes in CSR is to do co-operation with nongovernmental organizations. NGOs have the mastery about a particular market region and have an extraordinary expertise. Thus, CSR is a powerful tool for business organizations that help them in building a positive image, increased attention, profit maximization and overall business process improvements.

3. Applications of Sustainability Literature on Sports Direct:

3.1 Initiative Selection:

For Sports Direct sustainability initiatives can be diverse, however, limiting the company’s current objectives to start with a single dimension, sustainability effort recommendation is to partnering with other sports organizing companies and organizations for either launching a self-administered charity program or events to showcase the CSR and sustainability efforts. Therefore, the initiative selection includes collaboration of sports business and CSR objectives as:

  • Partnering with the Sports event organizations to sell products similar to Adidas (discussed in the examples above)
  • Organizing a sports based program aimed at funding for sports related and healthy life style adaptation in under-privileged or young people

3.2 Interest in CSR initiatives

The interest in the CSR initiatives of Sports Direct relies on the development and growth of company in following areas:

  • The company can achieve profit maximization as the increase in CSR objectives will increase company’s repute attracting more customers, stakeholders and other media attention
  • This also builds a positive image of company across globe
  • In future, the CSR initiative may open doors for business and product expansion  (Sheth, and Babiak, 2010)

3.3 Benefits of CSR Initiatives

The benefits of CSR initiatives for collaborating sports business and CSR objectives are wide ranging. For example, as discussed by Smith and Westerbeek (2007), sports have unique features and the business has global impacts. Thus, the advantages can be as following:

  1. Sports are a globally renowned business and attract large number of global customers. The company’s objective for participating in sports event or collaborating with sports events for football, cricket and other international events can increase the repute Smith and Westerbeek (2007). With the help of athlete (as brand ambassador) of sports directed CSR program, Sports Direct can attain the attention of media and global customers. In return, the company will see a huge increase in sales as a evident profit maximization on basis of CSR
  2. Sports are appealing to the young and fitness enthusiastic customers. The partnering of Sports Direct with other sports related events and programs as CSR objective will allow to increase the market base and the company will be successful in communicating its good citizenship, encouraging healthy life style and co-operation skills Smith and Westerbeek (2007)
  3. Sports initiated CSR objectives are ideal tool for creating a huge business impact. Thus, partnering with sports event organizers can build a strong and long term positive image of Sports Direct fighting against inactivity as suggested in study of Smith and Westerbeek (2007)
  4. With improved social image, the companies also gets the benefits of increased social interaction Smith and Westerbeek (2007). Thus, the CSR based Sports Program and objectives of Sports Direct can enhance the participation of company in social events, for social cause and stimulates social cohesion
  5. In times of big events, such as FIFA World Cup or Olympics, the company will get the benefit of product selling customized for events, promoting sustainability and environmental awareness Smith and Westerbeek (2007). For sports direct, partnering with big event organizers can help clarifying its social responsible behavior in front of existing customers and in emerging markets, whereas provides opportunity to raise awareness.     
  6. Another CSR benefit is the diversity based promotions Smith and Westerbeek (2007). In this area, the company may get an opportunity to identify itself as a social, diversified and understanding towards cultural diversities and social needs of societies. 
  7. In addition to raising environmental and social awareness, the company may get the gratification benefit, satisfaction and business related fun events promoting responsible behavior and increasing sales Smith and Westerbeek (2007). 

4. Future Prospects

This report is a rewarding learning process that communicates the benefits of sustainable and CSR objectives of Sports companies with perspectives mainly of social and community benefits and raising environmental awareness. In future, the research can also covers the remaining areas in this research. The report presents the interest of Sports and fitness through participation in sports related business and activities. This report has focus on how Sports Direct can participate in sports related events for promoting business social responsibility and sustainability in collaboration with other sports related events and management. From examples of business or implications discussed in literature review section, another interesting prospect of Sports related CSR drives focus towards integration of sports and non-sports business. Sports Direct is a product seller or reseller, however, in collaboration with other non-sports business the CSR objectives may goes to other sustainability dimensions. For example, collaborating with water supplier business can lead to spread awareness about optimal resource utilization and drinking safe water for health and safety.

In addition, future research may include the areas that are outside of sports. The CSR dimensions are not limited and similarly, sports based CSR is a relatively new dimension in research, thus other areas like impact of Sports based CSR in business processes such as resource utilization and other themes can be created in future. This report has implications for Sports Direct collaborating with sports related events and organizations, however, future benefits of using other business (non-sports) with Sports Direct, as a tool to CSR promotion is yet under focus of future study.

References

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  2. Athanasopoulou, P., Douvis, J. and Kyriakis, V., 2011. Corporate social responsibility (CSR) in sports: antecedents and consequences. In 4th Annual EuroMed Conference of the EuroMed Academy of Business., 2011.
  3. FIBS, 2014. Corporate Responsibility Network. [Online] Available at: http://www.fibsry.fi/fi/ [Accessed 5 Feb 2017].
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  5. George, F.P., 2007. Corporate social responsibility-A strategic imperative for sustainable growth. Lex ET Scientia Int’l J., 14, p.p.119.
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  9. PAINE, L.S., 2009. 1 1 The value shift: merging social and financial. Humanism in Business, p.204.
  10. Plewa, C. and Quester, P.G., 2011. Sponsorship and CSR: is there a link? A conceptual framework. International Journal of Sports Marketing and Sponsorship, 12(4), pp.22-38.
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  13. Sheth, H. and Babiak, K.M., 2010. Beyond the game: Perceptions and practices of corporate social responsibility in the professional sport industry. Journal of Business Ethics, 91(3), pp.433-450.
  14. Smith, A.C. and Westerbeek, H.M., 2007. Sport as a vehicle for deploying corporate social responsibility. The Journal of Corporate Citizenship, (25), p.43.
  15. Sports Direct, official website, 2017. About Us. [Online] Available at: http://www.sportsdirectplc.com/about-us/at-a-glance.aspx [Accessed 5 Feb 2016].