Examining sustainability investments and financial performance of football clubs: an empirical analysis

Lazaros Ntasis and Athanasios Strigas

Abstract

This study examines the effects of sustainability investments, financial leverage and growth rates on stock price returns of football (soccer) clubs. Empirical analysis, including data envelopment and regression analysis, reveals that sustainability investments significantly influence stock price returns, suggesting positive investor valuation. Moreover, growth in football clubs positively affects their stock performance, underscoring the importance of growth strategies. However, the study does not establish a significant link between financial leverage and sustainability investments. The research emphasizes the necessity of understanding the underlying motivations for sustainability practices in football clubs. The data sample used includes the stock prices of nine listed professional football clubs from the football leagues of the Netherlands, England, Germany, Portugal, Italy and France between May 1, 2015 and October 7, 2023. While investors value sustainability investments, industry stakeholders must consider diverse factors beyond financial leverage when combining financial decisions with sustainability initiatives. The study’s nuanced findings contribute to an understanding of the complex relationship between sustainability and financial performance in the sports industry, prompting further research into the factors driving clubs’ decisions regarding sustainability initiatives.