A-B InBev Adds Incentives to Sports Sponsorship Contracts; Environmental Performance Should Be In Mix

A-B InBev, the parent company of Anheuser-Busch and America’s biggest sports sponsor, is making a big change to the way it deals with its sports property partners. Incentives for positive on- and/or off-field performance are now being included in their contracts with leagues, teams, events and venues. Will environmental incentives be in the mix?

 

Terry Lefton, arguably the dean of sports-business journalists, broke an important story in the April 2 issue of Sports Business Journal (SBJ)

In “A-B’s Sponsor Shocker,” Lefton wrote that A-B InBev (ABI), America’s biggest sports sponsor, is “instituting incentive clauses within its [sponsorship] deals…offering properties as much as a 30 percent bonus if specific on-field performance and marketing criteria are met or surpassed…ABI is believed to be the first major sponsor to make it a standard part of its sponsorship contracts.”

A challenging and changing landscape for sports, both at stadia and arenas as well as on TV, is providing new leverage for sponsors and is helping to drive this new way of dealing with properties.

Lefton quoted Joao Chueiri, ABI’s vice president for consumer connections and a prime mover behind this new approach, as saying, “The traditional sponsorship model, based on fees and media commitments, does not deliver the best value for us at a time when most leagues and teams are facing challenges with live attendance and TV ratings. We want to evolve the model and encourage fan engagement … with an awareness that each deal is unique.”

 

Joao SBJ

Joao Chueiri, ABI’s vice president for consumer connections (Photo credit: Terry Lefton/Sports Business Journal)

 

Lefton reported that the early partners in new, incentive-laden ABI deals are the Minnesota Timberwolves of the NBA, MLB’s Los Angeles Dodgers, the New Orleans Saints  of the NFL and NASCAR: “The stock car circuit opted for earned media, fan engagement/social media measures, while the Dodgers, after a season in which they won the National League pennant, chose on-field performance indicators, including wins and losses.”

 

Budweiser TWolves

Budweiser signage adorns the scoreboard at Target Center in Minneapolis, home of the NBA’s Minnesota Timberwolves (Photo credit: NBA.com)

 

Will properties suffer a penalty if they don’t meet the minimum thresholds for incentives?

In a word, no.

Per Lefton, “they won’t get paid less if they fail to meet those targets.” Not surprisingly, every property that has been asked to accept an incentive-laden model has done so.

Chueiri told SBJ that key performance indicators for incentives available under ABI’s new sponsorship model include “attendance, wins/losses and other on-field performance measures, social media and other fan engagement metrics, and brand awareness and consideration among those aware of the sponsorship. The idea is to motivate the property to ensure every fan knows that Budweiser is the official beer.” ABI hopes the incentive program might be the differentiator to make a team, league or event choose it over a competitor.

Environmental performance was not a part of the list of metrics mentioned by Chueiri.

This is not surprising at this early stage. Metrics like wins and losses and social media traffic should be at the top of a list of incentives for a potential ABI sports property partner to hit. These are all “mothers’ milk” for teams and sponsors alike.

But, it says here that, sooner rather than later, environmental performance metrics need to be added to ABI’s list:

  • ABI has made clear that environmental performance, especially on water-related issues, is a core part of its DNA
  • Flagship ABI brands like Budweiser and Stella Artois advertise their commitment to access to clean water on mega sports broadcasts like Super Bowl LII
  • Lefton reported that all of ABI’s 90 or so U.S. team and league sports sponsorships are up by the end of 2021 and that “the brewer hopes to have completely overhauled its sponsorship model by then.”

 

Matt Damon stars in Stella Artois’ 30 second, water conservation-themed, Super Bowl ad

 

With that being the case, metrics like water use efficiency and waste diversion rates need to become part of ABI’s sports partnership incentive program soon.

THAT will be a very big deal.

Watch this space.

 


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GreenSportsBlogger to Moderate Panel April 3 at NYU Stern School of Business

Will you be in New York City next Tuesday evening? Interested in Green-Sports? Then come on down to NYU’s Stern School of Business at 6:30 PM ET for an engaging panel discussion on the “Intersection of Sustainability, Sports & Business,” sponsored by the Center for Sustainable Business. As a Stern alum, it will be my pleasure to moderate the event.

 

Next Tuesday evening’s panel discussion at the NYU Stern School of Business on the “Intersection of Sustainability, Sports & Business” comes at an inflection point of sorts for the Green-Sports movement.

It has been quite successful at what I call “Green-Sports 1.0,” the greening of stadia and arenas. LEED certified venues and zero-waste games are more the rule than the exception these days, and that is a very good thing.

Now, we are slowly pivoting to the early days of “Green-Sports 2.0,” in which the sports world engages fans to take positive environmental actions. For this effort to have maximum impact, teams, leagues and the media that cover them must bring environmental messaging beyond the venues. That’s because the vast majority of fans who follow sports do so not by schlepping to the ballpark or arena, but rather via TV, online, mobile, radio, and newspaper sports pages.

And, it seems to me that for version 2.0 to get where it needs to go, the sponsors and advertisers who provide much of the mother’s milk for the sports industry, will have to take a leading role.

With that in mind, I could not imagine a better panel with whom to talk about the passing of the proverbial Green-Sports baton and more:

  • Doug Behar: Senior Vice President of Operations at Yankee Stadium
  • Alicia Chin: Senior Manager, Corporate Social Responsibility, National Hockey League
  • David McKenzie: Director, Corporate Social Responsibility, Anheuser-Busch
  • Will Yandell: Northeast Regional Marketing Manager, Clif Bar & Company

The event, which takes place at Stern’s Tisch Hall (40 West 4th Street, Room 411-413), is FREE (such a deal!) but you do need to register as seating is limited. Click here to do so. Start time is 6:30. I recommend that you arrive early as it is first come, first serve and seats are not guaranteed.

 

Tisch Hall NYU

Lobby of Tisch Hall at NYU’s Stern School of Business, site of next Tuesday evening’s panel discussion on the “Intersection of Sustainability, Sports & Business” (Photo credit: Yelp)

 

Thank you to the panelists and to Stern’s Center for Sustainable Business for hosting the event. I hope to see you there! If you know someone who would be interested in attending, by all means, please forward this post.

 

 


 

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If the Most Important Green Aspects of Super Bowl LII are Two Beer TV Ads, Is That a Good Thing?

Super Bowl LII will be played in Minnesota, one of the most environmentally-conscious states in the country. Host city Minneapolis is mass-transit friendly and filled with LEED certified stadia and arenas. The Philadelphia Eagles and New England Patriots will do battle in LEED Gold US Bank Stadium. The game will be zero-waste and 100 percent of the energy used to power the contest will be offset. Yet, it says here that the most important green aspect of the 2018 Super Bowl may well be two beer ads — unless the NFL steps up to tell the Big Game’s green story to the audience 100+ million people.

 

Question: What does this triumvirate — Clydesdale horses, the Bud Bowl, and recent catastrophic extreme weather events — have in common?

Answer: They are each themes of Budweiser Super Bowl ads, past and immediate future. If there was a Super Bowl Advertising Hall of Fame, the brand’s ads featuring the iconic, white maned horses and the fun, computer-generated football games played by teams of beer bottles (Bud vs. Bud Light!) would both certainly be first ballot inductees.

But corporate parent AB InBev’s stablemates Budweiser and Stella Artois are going in a different direction for Sunday’s broadcast on NBC.

In “Budweiser’s Super Bowl Beer Ad Isn’t about Beer,” which ran in the January 26 issue of Environmental Leader, Jennifer Hermes reported that the brand’s 60 second Super Bowl spot is actually about…water: “[US corporate parent] Anheuser-Busch currently produces canned drinking water at its Cartersville, GA, brewery, and ships them to communities in need. This year, the company shipped nearly three million cans of emergency drinking water to areas hit by Hurricanes Harvey, Irma, and Maria, and by the California wildfires. In total, the company says it has provided over 79 million cans of drinking water to communities in need. The Super Bowl ad tells the story of its employees in the Cartersville plant who produce the emergency drinking water. [It] features the general manager of the brewery, along with more than 20 of his local colleagues.”

 

Budweiser’s “Stand By You” water-themed Super Bowl ad (60 seconds)

 

Stella Artois’ 30 second ad, produced in partnership with water.org, features actor Patriots fan Matt Damon, who calls on beer lovers to step up to help solve the water crisis by buying a Stella beer chalice. Damon asserts that if just one percent of Super Bowl viewers purchase the glass, Stella will provide “clean water to one million people. For five years.”

 

Matt Damon stars in Stella Artois’ 30 second, water conservation-themed, Super Bowl ad

 

Why did Budweiser and Stella take this turn?

 

IT COMES DOWN TO WATER — AND EYEBALLS

Quality water is, of course, crucial to the beer brewing process. AB InBev and its U.S. subsidiary Anheuser-Busch has implemented a robust water stewardship and environmental protection program across its sprawling brewery roster.

The initiative has engaged employees, farmers, suppliers and strategic partners to devise and implement a wide range of water conservation and management measures. Anheuser-Busch says this approach helped it reduce water use across all of its U.S. breweries by nearly 50 percent over the last 10 years.

That is a BIG achievement which warrants the BIG ad spend — NBC Sports is charging $5 million dollars for a 30 second spot — on the BIG game to reach the BIGGEST television audience of the year — 111 million people watched the 2017 Super Bowl.

Reaching such a vast audience with environmentally-themed messaging is why I believe Bud and Stella Artois have co-authored the most important green story surrounding Super Bowl LII.

Oh, you might say, “I think the fact that the the NFL, the Minnesota Super Bowl Host Committee, and US Bank Stadium are teaming up to offset 100 percent of the game’s carbon footprint via the purchase of renewable energy credits is more consequential than a couple of ads.” Or, you might opine that “Rush2Recycle, the program sponsored by PepsiCo, and promoted by ex-NFL great Hines Ward, that will help Sunday’s game be the first zero-waste^ Super Bowl, has to be considered the most important green story.”

 

us bank stadium

Exterior of US Bank Stadium, site of Super Bowl LII (Photo credit: SI.com)

 

While those efforts are, of course, laudable, I still go with Bud and Stella.

Because the  audience of 100 million+ people who might see the Bud and/or Stella Artois water-themed ads on NBC will likely be between 50 to 100 times greater than the number of people who learn about the zero-waste and/or the offset aspects of Super Bowl LII. That audience includes the 66,000+ fans inside US Bank Stadium, along with readers of national media outlets like Fast Company magazine, which are giving the zero-waste Super Bowl story welcome coverage.

Now, the NFL can easily wrest the “most important green story of Super Bowl LII” title away from Bud and Stella. All it needs to do is to create a public service announcement touting the green aspects of Super Bowl LII — hey, as of this writing, there are three days left; plenty of time for great content to be produced — and air it on NBC during the game.

What a BIG deal that would be! But will the NFL step up?

The stakes, said Dr. Allen Hershkowitz, founder and former president of the Green Sports Alliance and a founding director of Sport and Sustainability International (SandSI), are much higher than even the Super Bowl itself.

“As one of the most visible sporting events in the world, the Super Bowl has a unique opportunity to promote environmental literacy and reduce cultural polarization related to climate change,” said Dr. Allen Hershkowitz. “US Bank Stadium’s commitment to 100 percent renewable energy credits, ambitious zero-waste goals, and the [Minneapolis] region’s intelligent mass transit infrastructure, positions this event to be among the most carbon intelligent Super Bowls ever. The question before us is this: Will the NFL meaningfully promote this aspect of the Super Bowl story? Given the bewildering retreat from essential, science-based climate policy being enacted by the worst environmental administration in our nation’s history, a counter message by the NFL promoting progress on climate could not be more important. It has a responsibility to the world to do so.”

 

ENVIRONMENTAL MESSAGING: A WINNER FOR THE NFL

NFL Commissioner Roger Goodell, Commissioner of the NFL, talks a good environmental game: “The NFL is a responsible steward of the environment in all areas of our business. Through [these zero-waste and offset projects], the League and its partners hope to set a new standard of environmental sustainability at the Super Bowl.”

But Goodell’s green talk mainly takes place in dry, easily ignorable press releases, not on Super Bowl broadcasts.

The Commish and league should go beyond press releases and talk the green talk to the widest possible audience — i.e. during the Super Bowl. Because doing so would likely be good for business.

Say what?

Hasn’t has been a tough season for the NFL: from anthem protests to “Fire the Sons of B**ches!;” from CTE to declining TV ratings#? Won’t many older fans get ticked off? Isn’t it better for a league whose ownership and fan base is seen as right-of-center to keep quiet about the environment and climate?

No, it is not.

And, again, I say this from a business building, not from the “it’s the right thing to do” point-of-view.

It is a 2016 conversation with an NFL marketing executive who preferred to remain anonymous that sticks with me. He said the one thing that kept him and his colleagues up at night the most was how to attract Millennial and Generation Z fans and keep them.

One thing that resonates with younger cohorts is the environment and climate: across the political spectrum, the 35-and-under set accepts the reality and seriousness of climate change at rates far greater than their older counterparts.

Will embracing climate and the environment be the main catalyst to turning the tide the NFL’s young fan problems? Of course not. This is a complex, multi-factorial problem and going BIG on the environment is, admittedly, not close to the most important potential solution.

But, it says here that an intelligent, clever environmentally-themed PSA will be well-received among Millennials and Gen Zers. Which would help.

Budweiser and Stella Artois, hardly fringe, left wing brands, believe leading with the environment is the right way to go. Will the NFL join them by airing a green PSA on Sunday? I wouldn’t bet* on it.

In the meantime, buy a Stella chalice and (responsibly) enjoy a Stella or a Bud in it on Super Sunday.

 

 

^ A sports event can claim “Zero-Waste” status by diverting 90 percent or more of its game day waste from landfill, most often by a combination of recycling and composting.
* I also am not betting on the game itself. My prediction? Patriots 24, Eagles 17. I hope I am wrong.
# NFL TV ratings have declined over the past three years but it still generates, by far, the biggest television audience — and not only in terms of sports programming.

 


 

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Purpose + Sport: Helping Brands Do Well By Doing Good, Including by Going Green

Neill Duffy has graced the pages of GreenSportsBlog several times, most notably for his work as Sustainability Director of the San Francisco Bay Area Super Bowl 50 Host Committee. Since then, he founded and serves as CEO of Purpose + Sport, a purpose-led marketing and sponsorship agency. Neill is very bullish on the future of top brands investing some of their sports sponsorship and advertising dollars on programs that have a social and/or environmental purpose. Neill and Advisory Board member Tony Ponturo, formerly the VP of media and sponsorships at Anheuser-Busch, talked to GreenSportsBlog about the move to purpose that is underway and how the business of sport is, and isn’t yet, embracing this opportunity.

 

GreenSportsBlog: Neill, what do you mean by your company’s name, Purpose + Sport?

Neill Duffy: Well, using the “+” sign was very intentional. I wanted to connote the notion of the whole being greater than the sum of the parts.

GSB: Kind of like 2 + 2 = 5 and that being the right answer.

ND: Exactly! When you add purpose to sports you get amplified results for all involved.

 

Neill Duffy

Neill Duffy, CEO, Purpose + Sport (Photo credit: Purpose + Sport)

 

GSB: And how did you and Tony connect?

Tony Ponturo: Well, in 2010, the St. Louis Sports Commission and National Sportsmanship Foundation launched the Musial Awards, to honor the athletes, male and female, who exhibit the best in sportsmanship, just like the legendary Cardinals Hall of Fame outfielder from the 1940s-60s, Stan “The Man” Musial. While not a member of the commission at the time, I consulted with them and have remained a fan of their work. Neill and my paths crossed when the National Sportsmanship Foundation asked Neill if he could help take the awards beyond St. Louis to more of a national footprint. They also introduced Neill and I to each other We talked a lot more about socially responsible business and how sports needs to move into this space more aggressively as he was in the process of building Purpose + Sport. So it seemed like a natural fit for me to take on the advisory role earlier, which I did earlier this year.

 

Panturo Tony

Tony Ponturo, Purpose + Sport Advisory Board Member (Photo Credit: Purpose + Sport)

 

GSB: Got it. What a great pairing of expertise. So give our readers the Purpose + Sport elevator pitch…

ND: Happy to. Consumers increasingly expect corporations to stand for something more than just profit…and in turn corporations are responding by embracing purpose as a management philosophy. The business of sport has however been slow to embrace this move and that’s where we come in. We’re all about inspiring the business of sport to do good and do well. We provide purposeful strategic, commercial engagement solutions to sports sponsor, properties and non-profits to help them show up more meaningfully and remain relevant to the fans.

GSB: I guess I buy that, but with a bit of an asterisk. I mean, do consumers really care that the companies from which they buy their sneakers or cars do good?

ND: Absolutely. And the number that do is going up, especially among younger consumers. For example, the 2017 Cone Report found that 78 percent want companies to address important social justice issues and that 87 percent will purchase a product because a company advocated for an issue they cared about and 76 percent will refuse to purchase a company’s products or services upon learning it supported an issue contrary to their beliefs. Corporations are starting to get this. According to the April, 2017 State of Marketing survey from Salesforce.com, about 2/3 of the most successful marketing managers today are “purpose driven.” Companies that make sustainability — in the broadest, “environmental, social and governance” sense of the word — core to their brands really do engender greater brand loyalty among their consumer bases. It’s that simple. The problem, as we see it, is that, until now, sports have lagged the broader market in embracing purpose. In fact, not a single sports team, event or federation makes any list of the most purposeful brands.

GSB: That’s a real shame. What are the reasons, do you think?

ND: Firstly, there is a lot of inertia in the sports business system to continue doing things the way they always have. Why would we want to change something that’s working. Secondly, people have been so caught up of late in chasing the next piece of shiny technology that’s going to enhance the fan experience – the app that tells fans which restroom line is the shortest – that they’ve lost sight of the equal if not greater importance of the message…I’m a great believer in the message being as important if not more important than the medium. But, like I said earlier, that’s changing. Mars, which advertises heavily on sports, recently announced that it is committing $1 billion to a climate-focused messaging campaign. I’ll be surprised if this commitment doesn’t carry through to their sponsorship activation.

GSB: I saw that—it is FANTASTIC. Tony, you were at the center of the sports marketing-sponsorship-advertising nexus for more than two decades at Anheuser-Busch — you were VP of media, sports and entertainment marketing from 1991 to 2008. You ran the Busch Media Group, with 150 people, commanded a $600 million budget, worked with leagues, and teams and the rest. So how come more leading sports sponsors haven’t done the type of thing Mars is doing?

TP: My take is that sports haven’t seen the need just yet — but like Neill is saying, that is changing. One reason they haven’t jumped in may be that most sports fans have been men and, and, this is a generalization, but most male sports fans don’t care that much about a team’s social responsibility profile. They basically care about one thing: wining the game. Women sports fans, on the other hand, are much more socially conscious.

GSB: And since women sports fans, as a cohort, are growing…

TP: …It follows that the number of teams doing good will grow, as will the number of brands sponsoring pro-social programs — no doubt about it. In 2016, I taught at a conference at NYU on “Leadership, Social Responsibility and Sports.” We conducted focus groups there and found that women routinely mentioned a team’s social responsibility profile as being important drivers as to their attitudes about the team and their sponsors. ND: And, given the current US federal government’s hostility to environmental sustainability and other pro social programs, business should step into the breach and take a leadership position on purpose — a big chunk of the public is hungering for this.

GSB:…”Greed is GOOD!” said Michael Douglas as Gordon Gekko in Wall Street…

ND: Exactly…that was the ethos back then. Since about 2000, the importance of purpose has been rising in that longitudinal study…People — men and women —are saying in greater numbers that while I need to do well, society also needs to do well. It’s just that sports need to get with the program. We saw something similar in the late adoption of operational sustainability by the teams and leagues which lagged what was happening in the corporate sector by 5-10 years.

GSB: How do you think most fans, male and female, will react purpose-themed sports initiatives.

TP: Fans tend to question “purpose” initiatives at first but, I believe, over the long haul, they’ll get on board.

GSB: So where does Purpose + Sport fit in?

ND: We aim to accelerate the process, deepen the impact and build business for sports sponsors, property owners and non-profits via Purpose-driven programs. We will show them how to bring to life doing good and doing well.

GSB: Can you give some examples?

TP: The Musial Awards are a good place to start. The 2017 version takes place on November 18 with an edited special airing in December. We are helping the Commission increase the awareness and value of the Awards beyond the St. Louis area. Our job is to bring the Awards’ focused, powerful message — that sports has the power to get people to take positive action and that fans and viewers will care — to broadcasters across the country, get them to say “YES!” to airing them. Having a national audience rather than a regional one is so much more appealing to most brands.

 

Musial Award Sign

 

GSB: On the one hand, I imagine that a TV show about athletes who do great things in the community will have broad appeal. On the other, I’m guessing that Stan Musial’s name doesn’t mean much for Gen Xers, Millennials and Gen Zers…

TP: You’re right…People who are under 45 don’t really know Musial, outside of folks in St. Louis. So we’re focusing on making the awards themselves relevant to broadcasters in Atlanta, Los Angeles, New York, and beyond. Right now, there are around ten awards offered, with the big one being the Lifetime Achievement award.

ND: We’ve been able, by showing the value of and interest in “purpose,” to take the awards from St. Louis only to 39 markets. Our aspiration is to eventually find a national broadcaster to see the value in the awards and for national advertisers/sponsors to do so as well.

GSB: Congratulations on getting to 39 markets. It seems to me that, getting a national broadcaster, along with national advertisers and sponsors, to see the value of the Musial Awards tis a logical next step for Purpose + Sport. Good luck. Let’s move over to Green-Sports specifically. At the 2016 Summer Olympics opening ceremonies in Rio, there was a 5-10 minute vignette on climate change. A global audience of an estimated 1 billion people saw this. NEWS FLASH: THE WORLD DIDN’T STOP SPINNING!! But in North American sports, there hasn’t been anything remotely like that at the Super Bowl, College Football Playoff, etc. Why are sports leagues, even those that are greening aggressively like the NHL, loath to talk about it? Loath to run PSA’s on actual broadcasts of actual games?

ND: Wasn’t what Rio 2016 did great?

GSB: LOVED IT!

ND: I haven’t seen any insights around how viewers reacted to this segment but, for me, it made perfect sense. It was very relevant given the importance of the Amazon to global climate. Kudos to the IOC and Rio 2016 for supporting the decision by the creative directors for the ceremony – Fernando Meirelles, Daniela Thomas and Andrucha Waddington – to include this piece on climate in the ceremony. My sense is that the North American pro and college sports leagues take a very tactical approach to the greening of their events and view it more for its operational efficiency / cost reduction benefits than anything else. This mirrors what happened in the business sector more broadly where sustainability started off being about improving efficiencies before evolving to be viewed as a strategic imperative that could be engage customers and other stakeholders for competitive advantage. My view is that the business of sport is beginning to change their view on the role that environmental sustainability should play in their organizations — and that means telling environmental and climate stories to their audiences and fan bases not just being green behind the scenes. Another important part to his story is the role that the television producers play. Many of the producers involved today across all the major broadcasters have been doing what they do for decades. They have a tried and tested format that has worked for them and they are loathe to alter it. They seem to be prepared to remain relevant and up to date when it comes to the technology they adopt but are much less current as to the messages they convey. As fresh eyes and hearts start to infiltrate the ranks of the producers, I think things will start to change.

 

Opening Ceremonies Rio

Aerial view of the climate change vignette during the opening ceremonies of the 2016 Summer Olympics in Rio (Photo credit: Huffington Post)

 

GSB: Do you think teams and leagues are afraid of the politics of environment/green/climate change?

ND: When I worked with the 34th America’s Cup Event Authority in San Francisco (2013), the words “climate change” were taboo within the organization despite the fact that we had made a legally binding commitment to the City of San Francisco that we would deliver a carbon neutral event. At the time, the leadership of the Event Authority was concerned that any discussion around climate change would be polarizing. Two years on from this event, at the Super Bowl 50 Host Committee, also in the Bay Area, we spoke openly about reducing our impact on climate change. Why were we able to do so? Thanks to bold leadership that celebrated rather than ran from the fact that Bay Area is a place where the acceptance of climate change is a given. It’s interesting to note that despite the Trump Administration’s position on climate change, Americans believe now more so than at any time in history that global warming is as a result of human activity and that the effects have already begun. This should give leagues, teams, athletes and sponsors the confidence to embrace this issue and I think we will as a result start to see more of them…

GSB: A la Mars…

ND: Exactly…We will see more of them openly aligning with the issue – particularly those where there is a direct link between the climate and the sport involved…winter sports, golf, sailing. In fact, Purpose + Sport recently advised a team that are preparing an entry for the 2021 edition of the Volvo Ocean Race on their purpose strategy. We brokered a partnership between the teams and Conservation International around a purpose very closely aligned to climate change and its impact on ocean health. I think this is a sign of things to come.

GSB: I hope and actually believe that you are right.

 


 

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