You’ll recall the £3m that Stan Kroenke awarded himself last year from Arsenal profits. You may recall I submitted a question about it at the AGM last October, and was fobbed off with a prepared answer read by Sir Chips.
My question read: It’s reported that Arsenal paid KSE £3m for advisory services. Was a competitive tender issued for these services and can you tell us specifically what the services were, why they were needed and whether such fees will become an annual feature?
The answer, according to The Daily Telegraph’s live blog of the event, which I’m sure is substantially correct, was:
“The £3m fee to was proposed by myself and Lord Harris in respect of wide range of services offered by Kroenke Sports Enterprises. They have an extensive experience and it is of upmost (sic) important (sic again) that we use it to best advantage, There was no competitive tender – they were available to us, so competitive tender was not needed. We are entirely satisfied. In terms of future fees, it will depend on the services provided.”
So no competitive tender was issued, no reason as to why the services were needed was given, no list of services was given (but apparently there were ‘a wide range’), and of course they can’t rule out more fees in the future, because “it will depend on the services provided.”
The services that you can’t tell us about? The wide range of things that you can’t name?
So to recap: two members of the Board who own no shares between them proposed that the company they purport to run on behalf of all shareholders, pays £3m to the majority shareholder (who allows them to sit on the Board) for services that can’t be defined but have never before been needed in 127 years of Arsenal history.
And there are people who actually say that there is no need for regulation of the activities of people at Arsenal. No need for accountability. Amazing.
The Board had another chance to explain what the £3m was for at the Supporters’ Forum meeting on 14 March. The minutes of this meeting were finally uploaded to the Arsenal website on 7 May, after a reminder from the AST rep. Arsenal seemed to have forgotten. Anyway, this was the question tabled:
Can the Club provide more detail about the consultancy services Stan Kroenke provided for his £3m fee? Is Ivan Gazidis addressing the reasons that this capability cannot be delivered by the in-house executive teams?
Chips doesn’t attend the Supporters’ Forum, but Ivan Gazidis does, so he answered this time – again a pre-written answer, not off the cuff – and according to the minutes eventually published by Arsenal, he said this:
The fee was paid to Kroenke and Sports Enterprise [I think he means Kroenke Sports & Entertainment] which is one of the largest, most respected and successful sports organisations in the United States, operating in the most sophisticated sports business market in the world. Their central team has extensive experience in the finance, digital, broadcast, ticketing, stadium operations, facilities and analytics areas amongst others. At Arsenal we have a very good and capable management team but we run a tight ship based on the scale of our operation and it would be irresponsible not to draw on this additional expertise that is available to us. In terms of any future fees, that would depend on the nature of the services provided. It was a proposal by the Chairman to pay a fee for the wide range of services provided to Arsenal Football Club by Kroenke Sports and Entertainment. He felt it was good governance to pay a fair fee for these services.
There’s that phrase again: Future fees will depend “on the nature of the services provided”. But the thing is Ivan, YOU STILL HAVEN’T TOLD US WHAT THE SERVICES WERE.
I understand from your answer that you believe KSE are more experienced than you, with your years of experience in the MLS and Premier League, and your management team, with their many, many years of experience in the Premier League – and shall we just ignore that Arsenal have bought their own specialist sports analytics company in the States? But what did KSE actually do for the £3m? Let’s see a list of services, how many days were spent on them and what value they added. Because if you can’t measure the value, where was the figure of £3m plucked from?
Even if the KSE consultants charged £2,000 a day you could rack up 1,500 days to get to £3m. That’s six full time consultants every working day of the year at two grand a day. What are they doing, Ivan? You must be able to tell us SOMETHING they’ve done.
Already we’re nearly at the end of another season, and another financial year for Arsenal will end in three weeks (31 May). So the Board must know by now whether KSE have once again provided these mysterious services in the current financial year. The next Supporters’ Forum meeting is next Monday, 11 May. I wonder if Ivan will be good enough to tell us the answer. Then if it’s ‘Yes’ we can wait with bated breath for Stan to tell Sir Chips what to give him, I mean for Sir Chips to pluck another figure from the air, no I mean for Ivan to carefully calculate the value of services provided by KSE so they can be fairly recompensed. Just like last year.
I am not so naïve as to think there ever were any services. I just wish Ivan had more of a conscience so he didn’t treat fans and Arsenal’s small shareholders like imbeciles and come out with this tripe.
Please don’t waste my time and yours by responding that ‘It’s Kroenke’s club, he can do what he wants’, or ‘No one would care in any other form of business’, I’m not interested. If that’s what you think then you’re part of the reason this happens, and why football CLUBS are no longer run as clubs – ie for the benefit of members. I know it’s how things happen. And just like politics or anything else, unless people object it will always be how things happen.