Bundesliga's 50+1 Model: A Footballing Benchmark
| Photo: Seppalot13, CC BY-SA 3.0 |
Bundesliga was the first of the top five European leagues to resume in May after the tiring ordeal of first wave of coronavirus infections and the subsequent lockdowns in Europe – owing to various factors such as increased testing among club staff, establishing separate team arrival times, social distancing and heightened quarantine rules. Disinfectants were even being sprayed on match balls, corner posts and in the
technical area before and during the games.
Although Germany had a firmer grip on the infection spread as the football season resumed, it was inevitable to witness the other top leagues do exactly the same. EPL, La Liga, Ligue 1 and Serie A followed suit.Despite all debates surrounding the medical ramifications of a restart, it was ultimately a financial decision. Without question, protocols had to be imposed to save the beautiful game’s socioeconomic status.
According to FIFA, in a recent report analyzing the financial impact of the pandemic on the sport, the football world has lost approximately $15bn – the combined net wealth of Africa & Latin America put together. Colossal.
Olli Rehn, the chairman of the FIFA Covid-19 relief committee said: “It’s a huge number and covers football economy in its entirety – an estimate loss in 211 member associations”.
FIFTY PLUS ONE – THE BEAU IDEAL?
Other than being the poster-child for pandemic restart-protocols, BuLi’s ownership model could possibly serve as the archetype and guiding principle in club management, and might hold answers to financial woes in the European football community. This includes soaring match day prices which contributes to low average attendances and less community-involvement when it comes to promoting the club on the European stage.
Famously known as the 50+1 rule – the lifeblood of Bundesliga – the model has sustained the highlyesteemed German league for decades. Historically speaking, German clubs have always operated as notfor-profit member associations, where private ownership was barred under any circumstances. The same reason why you don’t see Deutschland attracting investment-hungry billionaires taking over clubs and then treating it like a toy.
This ultimately changed in 1998, when the Deustche Fussball Liga (DFL) announced a major upheaval in the functioning of clubs – allowing football clubs to convert into public or private limited companies. But the underlying mantra stayed. All the BuLi clubs have the same majority shareholder – their respective fans, who own 51% share in the team. Fans supervise decision making in the club, giving them control over voting rights – from change in ticket prices to the chance to decide the club’s crest.
While public/private investors are free to venture as much share capital as they want, the rule ensures that the clubs’ member fans hold the majority of voting rights and hence the control of the board.
Borussia Dortmund’s CEO Hans-Joachim Watzke once said, “The German spectator has close ties with his club. If he feels he is no longer regarded as a fan but instead as a customer, we’ll have a problem.”
Such a comment could hardly come from the lips of Daniel Levy or Nasser Al-Khelaifi or Roman Abramovich, who have transformed their respective clubs into European powerhouses – but rarely have been seen as adhesives who can string communities together with their beloved clubs.
This is not to say their supporters are any less passionate about their club, but rather vice-versa. We live in a world where fans constantly seek engagement and rewarding experiences for their involvement. Imagine being a club member and voting to decide who the next club president is or having a say in changing the club crest. It emancipates, incentivizes and empowers supporters to the highest degree. Something every club in the world ought to do.
RELUCTANCE & EXCLUSIONS WITHIN GERMANY
Criticism against the model comes mainly from potential investors such as former Hannover 96 President Martin Kind, who was jubilantly dethroned from his post by the club’s supporters in 2019.
Most recently, current Bayern Munich CEO Karl-Heinz Rummenigge has voiced his opinions against the model that he believes to be a stagnating factor in re-branding German football – going on to say it widely promotes ‘populism’, a term that is still yet to be defined with precision. RB Leipzig CEO Oliver Mintzlaff thinks the same. They argue that the DFL should sooner or later open its market to avoid being incompetent on the European stage.
"Everyone is worried and fearful that we will lose competitiveness if we open up the market. The opposite is true, Germany would benefit from it." Rummenigge said.
In 2018, second tiered FC St.Pauli filed a motion that saw a whopping 18 out of 34 Bundesliga & 2. Bundesliga clubs back the ‘50+1 stays’ campaign. Four against. Nine abstained. Three unresponsive.
Quite a testament to the club mentality active in the German football scene. Historically, Bundesliga’s two ‘company clubs’ – VfL Wolfsburg (est. 1945) & Bayer 04 Leverkusen (est. 1904) – are owned by major car manufacturer Volkswagen and pharmaceutical giants Bayer, respectively.
But recent years have seen the rise of Hoffenheim and RB Leipzig, clubs that are frequently hated on and viewed as ‘plastic’ whose success have been bought, thanks to their ability to operate outside the 50+1 model.
THE CORONA EFFECT
Taking the current situation into account, the financial situation of several clubs worldwide is severe and lie in the balance. Germany is not immune either, with several clubs facing dire situations. FC Kaiserslautern filed for insolvency in June 2020 with debts amounting up to €25 million, FC Schalke 04 declared their financial woes after a dismal second half in the 19/20 season on and off the pitch, and most recently FSV Mainz 05 announced a pay cut to its first team players and several staff members.
Financial insolvency is a commonplace in world football. Not as common as you might think, but it does affect clubs every now and then – even in Germany. Although the magnitude of financial woes have their fair share of differences, rather large ones. Take an English club for example.
THE BURY FC DOWNTURN
Prior to the emergence of the microbe that took the world by storm, a heartbreaking story unfolded 10 miles north of Manchester in the town of Bury. Bury FC’s 134 year history came crashing down following the collapse of a last minute deal that was supposed to save the club from liquidation. Unpaid staff, soaring credit payments, shady financial deals and a contentious owner, Steven Dale – who previously held multiple records of liquidating businesses (43 out of 51 liquidated), but was nonetheless judged fit to run a club that has existed for more than a century?
Founded in 1885, Bury FC became the first club to be expelled from the English Football League since 1992. A bitter end to the club that called one of the oldest football stadiums in the world, Gigg Lane, its home. The club was never a stranger to financial problems – facing under a transfer embargo in 2012 due to financial problems as a result of high ticket prices leading to poor attendance figures. They were relegated that year to the League Two, the fourth division of the English league football system. Surprisingly enough for a team that holds the record of scoring a thousand goals in each of the four tiers of the English leagues. A record for the ages.
HIT OR MISS?
The democratic model of the 50+1 rule has served the needs of the clubs and communities more often than not.
“While the rest of Europe has boring leagues, half-empty stadia and clubs on the verge of bankruptcy, German football is in remarkable health”, former UEFA President Michel Platini proclaimed few years ago.
For more than a decade, Bundesliga has possessed the highest average attendance for any league in the world, let alone Europe. The league has the lowest average ticket prices in the top five European leagues. A feat highly improbable without the implementation of a model that integrates the fans as one of the club’s own.
Financial sustainability and supporter satisfaction is the name of the game. ‘Geisterspiele’ (ghost games) as the Germans call them may be the norm for now and the coronavirus pandemic may have well brought European football to its knees, but for all we know, it comes as an eyeopener to the financial distress many clubs endure.
Perhaps, it is high time clubs across Europe reform their way of working, not for self-sustenance but for sustaining a better footballing future. Well, we can only hope. One thing is for sure: there is no stopping the beautiful game. It must go on.