Why governance and fraud prevention are now strategic priorities in sport

A combination of increased regulatory oversight, enhanced risk of corporate criminal liability, and greater information sharing between regulators and law enforcement is creating a new environment in which governance is becoming a strategic priority. For clubs, governing bodies and other sports organisations, it is no longer enough to respond to issues when they arise. Increasingly, they are expected to demonstrate that they have the right culture, leadership, controls and oversight in place to prevent issues from occurring in the first place.

This shift comes at a time when the sports sector faces unique pressures. Financial performance, sporting success, investor confidence and regulatory compliance are often closely connected. Decisions relating to player recruitment, sponsorship arrangements, ownership structures, infrastructure projects and financial reporting can have significant consequences both on and off the pitch. Against that backdrop, effective governance is becoming an essential component of organisational resilience.

The growing focus on fraud prevention

One area placing governance firmly in the spotlight is the failure to prevent fraud offence introduced by the Economic Crime and Corporate Transparency Act 2023, which came into force in September 2025. The offence can make large organisations criminally liable where an employee, agent or other associated person commits certain fraud offences while intending to benefit the organisation. Organisations can have a defence if they are able to prove that they had reasonable fraud prevention procedures are in place.

While this offence applies across all sectors, sports organisations face distinctive challenges. The use of agents and intermediaries, complex sponsorship arrangements, transfer activity, investor funding, and regulatory reporting obligations can create both opportunities and pressures that increase fraud risk. Examples might include inaccurate financial reporting, misleading disclosures to regulators, inappropriate treatment of related-party transactions, or dishonest representations made during commercial or transfer negotiations. In some cases, individuals may perceive that misconduct benefits the organisation – by helping it meet financial sustainability requirements, secure investment, satisfy licensing obligations, or maintain a competitive advantage, for example.

The offence reflects a broader regulatory expectation that organisations should actively identify and manage fraud risks rather than simply react after misconduct has been uncovered. The challenge for boards is therefore ensuring that governance frameworks can surface where such risks exist and providing appropriate oversight and challenge.

Senior manager conduct under increasing scrutiny

Recent developments in the sports sector have highlighted how governance failings linked to individuals at the top of an organisation can rapidly become board-level issues, even where allegations or conduct arise outside day-to-day sporting operations. Against that backdrop, the expansion of corporate criminal liability for the conduct of senior managers is particularly significant. ECCTA made it easier to attribute certain economic crimes committed by senior managers to an organisation, and the Crime and Policing Act 2026 goes further by extending that principle across all criminal offences. All corporates can now be held criminally liable for any criminal offence committed by one of their senior managers.

For sports organisations, governance is increasingly about protecting the integrity, reputation and long-term sustainability of the organisation, by ensuring that those in positions of influence act consistently with the values and standards expected of the club or governing body, as much as it is about regulatory compliance.

The Independent Football Regulator and a new era of transparency

The arrival of the Independent Football Regulator (IFR) represents another significant development in the governance landscape in English football. The IFR's objective is not only to promote financial sustainability but also to assess whether clubs have appropriate financial and corporate governance arrangements in place. As clubs become subject to enhanced oversight and licensing requirements, the volume of information shared by the IFR with other regulators will increase significantly.

The Football Governance Act provides the IFR with powers to share information with a range of public authorities, including HMRC, the Financial Conduct Authority, the National Crime Agency and the Serious Fraud Office, where doing so assists those bodies in carrying out their functions. This creates a fundamentally different transparency landscape.

Information submitted to the IFR may sit alongside Companies House filings, tax information, audited financial statements and disclosures made to investors, lenders and other regulators. Inconsistencies between those sources may become easier to identify and investigate. This means that governance can no longer be assessed solely by reference to sporting regulations. Information provided for one regulatory purpose could potentially become relevant to wider regulatory or law enforcement scrutiny.

Governance as a competitive advantage

The most effective organisations are unlikely to view these developments as simply additional compliance obligations. Strong governance can help build confidence among investors, regulators, sponsors and supporters, while reducing the risk of costly investigations, enforcement action and reputational damage. In a sector where trust, reputation and financial sustainability are critical, governance has become far more than a boardroom exercise. From the boardroom to the pitch, organisations that invest in effective governance today will be better placed to navigate the increasingly complex regulatory environment of tomorrow.

What can sports organisations do now?

• Conduct a risk assessment to identify the fraud and other compliance risks it faces, factoring in specific sectoral risks into this process;
• Organise board-level briefings on fraud and compliance topics, and designate responsibilities;
• Identify who might qualify as a senior manager by considering their role in the business;
• Carry out enhanced fraud and compliance training, especially for senior managers and those in control functions; and
• Review existing fraud prevention and compliance controls to ensure that they suitably address the risks the business faces as well as complying with regulator expectations.