Strategic and Financial Implications of UEFA’s Financial Fair Play Regulations: A Comparative Study of Commercially Mature and Immature Football Clubs

Herman Schüller & Martin Withammer

Student thesis: Master thesis


Accelerating insolvency and extreme debt levels in the European football landscape necessitated action from the governing body UEFA to preserve the financial health of professional football clubs. Consequently, the Financial Fair Play Regulations (FFP) were introduced to overcome these issues and strengthen the credibility of the sport. Whilst previous literature has concentrated on the impact of the FFP in relation to elite clubs in the Big-5 European football leagues, there has been less attention towards Scandinavian clubs trying to compete at the highest level. To illustrate how football clubs are controlled and how they handle FFP, we develop a theoretical framework designed for comparing football clubs in both governance and financial spheres. The study utilizes a qualitative research method by conducting semi-structured in-depth interviews with executives in Scandinavian top clubs. Furthermore, we compare our findings with empirical data from commercially mature clubs in the Big-5 leagues, which contributes to the increasing amount of scholarly work on FFP. Our findings demonstrate that a formal governance mechanism such as FFP has a larger impact on elite clubs compared to the Scandinavian ones for two distinct reasons. Firstly, the necessity of formal governance mechanisms increases as football clubs become more complex and businessoriented. Secondly, informal governance mechanisms such as culture and societal values are more noticeable regarding how Scandinavian clubs are controlled. Moreover, our results indicate that FFP has not fully worked as intended, as its “break-even requirement” has contributed in isolating an elite group of clubs getting richer at a higher speed compared to non-elite clubs. This competitive gap and newly discovered data tells a two-fold story for the future of commercially mature and immature clubs respectively. While the commercially mature clubs are likely to isolate themselves by compressing their competitive environment and enhancing their global strategies, Scandinavian clubs need to intensify their talent development strategies and be proactive in new technologies that can attract young people and strengthen their local adaption. However, it is difficult to determine the exact impact of FFP, because numerous factors have contributed to enhance the financial and competitive disparities between clubs. The trend is undisputable, and the question is whether or not the industry is adequately designed to face contingencies that are disrupting football’s competitive balance and romantic vision.

EducationsMSc in Finance and Strategic Management, (Graduate Programme) Final Thesis
Publication date2019
Number of pages127
SupervisorsSven Junghagen