The Qatar World Cup controversies are raising the profile of sport-related ESG, says the portfolio manager

By James Rogers

According to Luis Garcia Alvarez, equity portfolio manager at MAPFRE AM Behavioral Fund, the controversial World Cup in Qatar is raising the profile of sports-related environmental, social and governance investments.

According to Luis Garcia Alvarez, equity portfolio manager at MAPFRE AM Behavioral Fund, the controversial World Cup in Qatar is raising the profile of sports-related environmental, social and governance investments.

“If there is one thing that has defined the weeks and months leading up to this World Cup in Qatar, it is the controversies surrounding the social and ethical implications of this host country’s choice, with the situation being further clouded by suspicions of possible government errors became FIFA when the host country was selected,” he said in an email statement to MarketWatch.

The tournament is arguably the most controversial in World Cup history, with Qatar – which was selected to host 2022 on the same December day in 2010 that Russia was selected to host the 2018 tournament – with a spate of criticism over its treatment of migrant workers and migrant workers is approaching LGBTQ+ rights in the country.

See Now: The backlash to the World Cup in Qatar is an important moment for football, says ESPN’s Shaka Hislop

For example, ESG investing is well established in areas such as sustainability, where a public company’s transparency to reducing greenhouse gas emissions could come under scrutiny from investors.

However, according to Garcia Alvarez, ESG has been less prominent in sports-related investments.

“The world of sport (and the world of football in particular) is probably the best common ground we have to make a positive impact on society through the concept of unity, testing and implementing technologies that improve our care environment and to promote good governance in our institutions,” he added. “Therefore, it seems surprising that ESG investing in this particular area has received so little attention, at least so far.”

See Now: Qatar World Cup controversy means sponsors are walking a tightrope

Controversy continues to swirl around the tournament. After FIFA slammed plans for a number of team captains to wear “One Love” armbands to promote LGBTQ+ rights, Germany’s side protested on Wednesday by covering their mouths with their hands during a team photo ahead of their game against Japan covered.

For ESPN commentator and former World Cup star Shaka Hislop, the backlash is an important moment for the sport. “History offers those moments that we need to make the best of,” he said during an event hosted by MarketWatch on Wednesday. “Even though we have recognized the impact that the game can have, the changes that the game can have, this is a moment that we should take to realize that football represents everything.”

According to branding experts, the counter-reaction to this World Cup also poses challenges for the well-known sponsors of the tournament.

See Now: British band The Farm blocks McDonald’s from using a hit song in a Qatar World Cup ad

FIFA’s list of partners includes US corporate titans Coca-Cola Co. (KO) and Visa Inc. (V), both of which are involved in the Qatar event. McDonald’s Corp. (MCD) is also committed as a World Cup sponsor.

Budweiser, the World Cup’s beer sponsor, was in the spotlight after tournament organizers last-minute banned beer sales at the stadium.

The Muslim nation, which will be the first country in the Arab world to host the World Cup, previously said beer sales would be allowed in stadiums. The reversal of that decision seemed to surprise the brand, which is owned by Anheuser-Busch InBev. The following day, however, Budweiser shrugged off the beer ban and teased a new campaign linked to the tournament.

See also: ‘Well, that’s embarrassing’: Qatar bans beer sales in World Cup stadiums, surprise sponsor Budweiser

Budweiser says it will give away unused beer to the world-champion nation.

In May, Amnesty International along with 23 other organizations wrote an open letter to FIFA President Gianni Infantino calling for a “cure for the labor abuses behind the 2022 World Cup”.

The death toll among construction workers in Qatar remains firmly in the spotlight. According to Amnesty, thousands of migrant workers have died since 2010, when Qatar was chosen to host the tournament. The number of fatalities cited by Qatar is significantly lower, and the country’s Supreme Delivery and Legacy Committee, which oversees the World Cup, called Amnesty’s letter inaccurate.

Related: Is it legal to drink alcohol in Qatar?

“Over the past two decades, Qatar has embarked on an overhaul of its labor system, with sweeping measures taken to benefit the millions of workers in our country,” a Qatari government official said in a statement emailed to MarketWatch earlier this month .

FIFA has established grievance mechanisms with the Supreme Committee for Delivery and Legacy. As of December 2021, workers reportedly recovered $22.6 million in recruiting fees, with an additional $5.7 million pledged by contractors.

Fox Sports owned by Fox Corp. (FOXA), the affiliate of MarketWatch publisher Dow Jones’ parent company, News Corp (NWSA), holds the United States English language broadcast rights to the Qatar World Cup.

-James Rogers

 

(ENDS) Dow Jones Newswires

11/25/22 1224ET

Copyright (c) 2022 Dow Jones & Company, Inc.

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