Football Governance Bill requires clubs to show DEI efforts

The obligation comes at a time when equality campaigners have been calling for any new legislation to do more to tackle under-representation in men’s professional football.

The proposed bill, first tabled by the Conservative government in March 2024 and continued by the new Labour government, includes the introduction of an independent football regulator (IFR). The IFR is to be established for men’s professional football across the top five leagues in England. The IFR is expected to be given new powers to provide for financial sustainability of clubs and their owners, fan engagement and corporate governance. The IFR’s consultations with clubs on how it will give effect to the detail of these requirements will likely be crucial to developing a workable code of practice on DEI issues.

Once the legislation is in force, one of the corporate governance requirements on clubs will be for them to publish a statement each year. As part of this, clubs will need to explain how they are tackling DEI issues. The IFR is expected to start consulting clubs later this year on the development of a more detailed code of practice on what exactly each corporate governance statement will need to address on DEI matters.

The legislation requires the IFR to act proportionately, so it is expected that the corporate governance standards imposed may vary according to a club’s turnover or its position in the football pyramid. However, some form of reporting on DEI will be required of all 92 affected clubs.

Studies have identified a range of potential DEI issues across the men’s professional game, including significant differences in proportion of people from minority ethnic backgrounds being in player positions compared to in managerial and other senior roles.

There are still calls for ethnicity pay gap reporting to become a legal requirement for UK employers to emphasise the difference in pay between ethnicities.

Whilst the new legislation and regulatory body is to only focus on men’s professional football for the moment, Women in Football is currently campaigning for at least 30% representation of women in senior decision-making roles. The body has identified a severe lack of representation for women in senior positions within Premier League clubs and, at the European level, UEFA Champions League clubs, compared to FTSE 100 companies: 10% versus 35% respectively. Given FTSE 350 companies are generally setting targets of 40% female representation on their boards, this only further highlights the lack of representation.

Regulations requiring organisations to commit to DEI have been increasing for some years now. In the UK, the Pensions Regulator recently added such commitments to its regulations, while the Financial Conduct Authority (FCA) requires listed financial firms to report on their DEI policies and practices of their senior management team. The FCA has also been clear that non-financial misconduct, such as sexual harassment, is misconduct for regulatory purposes.

The FCA has seen some improvement already from implementing DEI requirements. Since signing the Women in Finance Charter in 2016, female senior leadership team (SLT) representation in UK financial services has risen from 29% to 49%. Minority ethnic SLT representation has slightly increased over the last year, now at 14% from 13.9%, while there has also been an increase from 1.3% to 2.5% for black SLT representation.

It is hoped that the new football regulator will encourage positive change in terms of DEI across English football, with other industries also encouraged to take note.

Co-written by Frances Wagstaff of Pinsent Masons’ DEI consultancy, Brook Graham.