Knives Out For The Gunners

As Arsenal players recover from their season's nailbiting finale, the club's shareholders find themselves embroiled in a burgeoning scandal over their links to one of Asia's most notorious companies.

As Arsenal players recover from their season's nailbiting finale, the club's shareholders find themselves embroiled in a burgeoning scandal over their links to one of Asia's most notorious companies. And they deserve every last drop of opprobrium, thanks to their capitulation to greed at the expense of due diligence, ethics, and the reputation of the football club they own.

In my final year before selling my own Arsenal shares, I attended the AGM at the Emirates, and listened to the club's finance director as he bragged of "building a massive presence in Asia". He reeled off a list of achievements to date in their eastwards march: "Arsenal credit cards in Hong Kong, sponsorship deals with Tiger Beer, and tie-ups with football teams in Vietnam", noting the sharp increase in revenues such a strategy was expected to deliver over the coming years.

But now the chickens are coming home to roost, as a PR disaster looms on the back of Arsenal's latest Asian adventure. The club has developed strong links with Doan Nguyen Duc, the venal tycoon behind HAGL, one of Vietnam's largest companies. Thanks to their new-found friendship, Duc has won the concession to be the main distributor for Arsenal merchandise in Vietnam, and the cosying-up to one another has even led Duc to convince Arsenal to play a friendly in Vietnam in the close season.

All in line with Arsenal's plans for global domination (of the corporate kind at least, even if the players have lately struggled to emulate such glory on the pitch). All in line with what shareholders expect of a company dedicated to extracting profit wherever it can, and all in line with the soulless state of top-tier football clubs in the Premier League era. But a devastating report just published by Global Witness into land-grabs and deforestation across Cambodia and Laos has dragged Arsenal's name through the mud thanks to the raft of allegations against HAGL and owner Duc.

The culmination of a year's on-the-ground investigation, Global Witness have exposed the ruthless way in which rubber companies have operated illegally and seized indigenous people's land, before stripping forests bare and using the land for rubber plantations. The report reveals international backers for companies such as HAGL, including Deutsche Bank and IFC (the private lending arm of the World Bank), who have seemingly as little regard for ethics or the environment as the boards of HAGL et al themselves.

That Arsenal should find themselves caught up in such a furore is a problem all of their own making, and the barrage of criticism already aimed their way in both the national press and on dedicated Arsenal forums should serve to inform the directors quite how large a PR crisis is in the offing. The club's response so far has been to plead ignorance, promising to approach HAGL to ascertain its response to Global Witness's allegations.

As the days tick by, the anger grows, with petitions from fans springing up calling for a swift severing of ties between their club and the rapacious Duc, including cancelling the upcoming exhibition match in Vietnam. As lifelong Arsenal fan and petition-organiser Nic Schlagman put it, "Arsenal have spoken for years about Financial Fair Play, about firing £50 notes onto the lawn, about the right way to run a club. This partnership undoes years of hard work, of careful branding and sensible financial control... They need to walk away from this partnership and find better friends in Asia for the thousands of fans we have there. If you take the shine off the brand it will hurt you in the pocket before too long".

While optimists would hope Arsenal perform a swift volte-face in the face of such damning evidence, realists know the board will be swayed less by moral choices, and more by whatever their advisers come up with after a quick cost-benefit analysis. Lost revenue in Asia is easy - and painful - to quantify; bad PR and press opprobrium, whilst equally undesirable, is far more oblique, and thus may prove a somewhat less bitter pill for the club's owners to swallow.

But even if Arsenal don't tear up their deals with Duc, they will certainly be forced to think twice about future tie-ups, and will seek to be wise before the event to avoid a repeat of this week's heavy censure. Global Witness's efforts, coupled with the power of the British press and the equally fierce response from many of the club's fans, have dealt a sizeable blow to Arsenal's veneer of respectability. Other clubs would do well to examine their own similar deals, before they too are caught turning a blind eye to abuse just to boost their balance sheets.


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