04/02/2015

MUST to present proposals for Football Ownership and Governance reform to MPs

MUST Chief Executive is heading to Westminster for a meeting with MPs this afternoon to present MUST proposals for Football Ownership & Governance reform.

These proposals have been endorsed as effective and feasible by a number of advisors including top Corporate Lawyers such as Freshfields' Mark Rawlinson (acting in a personal capacity and pro bono). Mark was one of the 2010 Red Knights but also advisor to MUFC board in 2004/5 when he devised the innovative, initially successful defence against the Glazer takeover before Cubic Expression indicated their desire for the offer to proceed.

If implemented these proposals would prevent, amongst a plethora of other ills, a Glazer style leveraged takeover, or indeed any actions (on behalf of shareholders) which were against the interests of the Club

A few bullet points:

• A new Football Club Ownership & Governance Act

• A simplified corporate ownership structure - a single holding company (or new entity) registered in UK (EU), governed by UK Law and paying UK Tax

• Fans to be legally recognised as key stakeholders especially with respect to certain reserved matters such as Club name, colours. location ...

• We should not accept lower standards of Corporate Governance from our Football Clubs than our listed public companies

• All clubs to comply with UK Corporate Governance Code and operate under the highest practicable levels of transparency

• Controlling boards of our clubs should have a majority of independent directors to prevent abuse/exploitation by any single shareholder/owner

• Let the executives and management do their jobs without owner interference

• Duties of Independent Directors, as with ordinary companies, remain to the shareholders, except where there is a conflict of interest with the Club. Then Club must take priority

• Duties of Independent Directors to also include (a) promoting Club engagement, consultation and transparency with supporters and (b) facilitating supporter investment in Club shares to promote shared ownership with fans

• New tax reliefs akin to EIS/SITR for supporters' trusts' saving and football club share investment vehicles
• "Right to Buy". A portion of any Club share sale should be offered, as a time limited option, to the Supporters' Trust

• "Right to Invest". When specified criteria are met the Supporters' Trust has the option to request new shares are issued to allow cash investment into Club while increasing supporter ownership stake. Existing shareholders' asset value remains undiminished but influence is diversified - a beneficial result

• 100% supporter ownership isn't necessary or, arguably, the most desirable model. No single shareholder controlling/exploiting the Club for their own benefit is the key reform - similar to Swansea's shareholder agreement

• A diverse share ownership with a mixture of commercial and emotional investors can provide the optimum model of commercial drive with profits reinvested into Club - similar to Bayern Munich