Saudi Arabia buys golf: Sportswashing vs social responsibility

Saudi Arabia's latest sporting venture has seen the governor of the Public Investment Fund (PIF) – the country’s sovereign wealth fund – named the chairman of a newly merged LIV/PGA/DP golf entity.

But how will fans respond to their sport being chiefly financed by Saudi Arabia, given the country's poor human rights record?

Prior to the merger being agreed, there had been a bitter rivalry between LIV and the PGA, with part of the disagreement between the tours stemming from the perceived intentions of LIV Golf. The PIF has stated that they are investing in sport as a means to tackle the country's obesity issue, as well as providing another revenue path. Hence, they are not so reliant on petrodollars.   

However, many outside of Saudi Arabia believe that the role of ventures such as LIV is a means for the country to improve its public reputation in the face of its poor human rights record.

Indeed, this was a point made directly by the PGA prior to the recent agreement, when they accused the PIF of using the “sport of golf to 'sportswash' the Saudi government's deplorable reputation for human rights abuses”.

Customer experience and social responsibility

Amongst all the confusion of how this will impact the players and the game of golf itself, an area that has been largely ignored thus far is how this will affect the fans and customers of the sport moving forward.

Currently, the scrutiny surrounding brands and businesses has never been higher. Not only are customers expecting companies to take strong moral and ethical stands, but with customer loyalty plummeting, consumers are more than happy to go elsewhere if they are dissatisfied.

Customers want authenticity from their brands – not hypocrisy.

Moreover, customers are shrewder than ever when it comes to tokenism and empty gestures. They want authenticity from their brands, not hypocrisy – something that Brewdog found out to their cost, when customers discovered that the brewery had signed a distribution deal with Qatar during the men’s Football World Cup, despite running a campaign critiquing the country’s human rights record.

The need for brands to legitimately “stand for something” was discussed by Abdul Khaled – head of digital, CX and digital products for E.ON Next – in a recent episode of MyCustomer’s podcast: “I think we're a much more conscious generation, where we learn to understand the values and principles of businesses that we are engaging with.

“There’s a small niche of loyal customers who really believe in the values that we are offering and they will stay with us based on those values.”

Whilst Abdul refers to a “small niche” of customers, in many sectors it is a growing one that more and more brands are catering to – particularly those with a younger demographic who are more proactive when it comes to social and ethical causes.

An example of this is cosmetics company Lush, which closed down its major social media accounts in November 2021 in a stand against the damage that the platforms were causing users.

Lush’s combination of a legitimate record of taking strong ethical stances and a large portion of their consumer base consisting of shoppers aged between 16 and 24 (38%), and 25 and 34 (27%), means that their decision to boycott social media didn’t damage their company, but actually worked in its favour by boosting sales and improving the brand’s reputation.

'We know that younger people, in particular, are expecting more from brands, with ethical business practices considered a non-negotiable.'

Gen Z’s increased interest in the social responsibility of brands was also discussed by Steve Leigh, managing director of research at Sensu Insight: “We know that younger people, in particular, are expecting more from brands, with ethical business practices considered a non-negotiable.

“From our report into attitudes towards employer brands, for example, results suggested an almost three-fold increase in the importance that Gen Z places on the social consciousness of organisations, in comparison to the attitudes of older counterparts.”

So what does this mean for the new merger between LIV and the PGA?

From a customer perspective, it makes pretty grim reading. Not only will this new golf entity be backed by an institute with a poor human rights record, but in flip-flopping from its initial stance condemning the PIF to now striking a deal with them, the PGA has opened itself up to accusations of hypocrisy.

It is this hypocrisy that Josh Green, executive creative director at House 337, believes will be the most damaging for golf’s customer base: “The immediate issue is that the golfing establishment essentially changed tack overnight – from hanging its hat on Saudi’s human rights history to now suggesting that a combined commercial arrangement is for ‘the good of the game.’

“In truth, they may have gotten away with this a decade or two ago, but today is a totally different game. As golf looks to get younger, this won’t help their cause. Putting values and worldview aside (if that’s possible), it’s the hypocrisy of the u-turn that will do them no favours when it comes to getting a new generation of fans into the game.”

Customers v fans

Whilst there is undoubted merit to the points raised above, there is an argument to be made that in the end this merger won’t actually deter too many golf fans and customers.

LIV is one of many examples of Arabian Peninsula owned sports teams, and looking at some of the others may provide context to how the LIV/PGA merger will play out in the long term. 

• Newcastle United football club were purchased by the PIF less than two years ago, and fans have seen their team going from relegation contenders to qualifying for the Champions League.
• It’s been almost 15 years since Manchester City football club were effectively purchased by the UAE. In that time they have been the most successful team in the Premier League, are on the cusp of an historic treble, and were recently named the most valuable football club brand in the world.
• And perhaps the most infamous of all is the hosting of the men’s Football World Cup in Qatar at the end of last year. Despite the countless reports of migrant deaths during the building of the stadiums needed to host the event, and the country’s poor human rights records, the tournament was a success.

These are three examples of many, and they all appear to suggest that in spite of the controversies, people will continue to watch and support their teams or sport.

The relationship with sports teams and fans is a very different dynamic to retail brands and customers.

If a customer is unhappy with the ethical practices of a clothing store, a restaurant, or a gym – they can usually find an alternative fairly easily. For fans who have dedicated time, love, and passion to supporting and following their team, it’s not as easy as just picking another team to support.