Recent weeks have seen the commencement of the all new Extreme E "climate-aware racing series", the Man Utd women's team playing their first game at Old Trafford and discussions of a Premier League-wide social media boycott in response to continued racial abuse of players online. 

Your favourite sports team might not be the first thing that comes to mind when thinking about ESG, but it is undeniable that they are entangled with all aspects of the topic. 

Depending on the sport, the environmental limb may be the least obvious - the sports economy not necessarily having a large carbon footprint. But one only has to think of the presumably fairly hefty energy bill of running large stadia and expansive training facilities to identify one area of "E" focus. Others include numerous flights to events across the world, the use of water in the maintenance of hallowed turfs or the waste created by the continuous stream of frequently updated replica kits, often high in plastic content. The fast growth of e-sports adds another E dimension to the equation.

The social and governance angles are easier to identify. 

On the social side, diversity and equality have long been high-profile topics, on which some progress is being made but, as recent events continue to show, there is much more to do. 

Looking again at the merchandise on offer from your sporting organisation of choice, there is also a need to focus on supply chain management, which brings with it the concerns of labour standards, human rights and health and safety. There have been numerous headlines in recent months around fashion and retail brands to demonstrate that these are topics worthy of attention. 

From a governance perspective, it would be all to easy to point to transparency and business ethics in the same sentence as the upcoming football world cup next year. But there are also points to note in relation to culture and whistleblowing in light of the allegations that have come out in recent years around treatment of (particularly young and/or female) sports stars.

But why is this relevant? No one is expected to stop following their childhood team simply because they don't use renewable energy (although I encourage looking at Forest Green Rovers, dubbed the "world's greenest football club" by FIFA and owned by Ecotricity owner Dale Vince).

There are two points I would make. 

First, the ESG megatrend is demonstrating the potentially high cost of getting "ESG" topics wrong and there are increasingly high expectations from civil society and NGOs on how companies do business. 

Secondly, the Forbes list of the world's most valuable soccer (please read football) teams was released yesterday which revealed an increase in value of those teams of, on average, 30% over the past two years (and this is despite Covid-19). This performance demonstrates real investor appeal (and it is worth noting that as of March 2020, 25% of all NBA franchises were PE-owned). However, investors themselves are coming under increased pressure to move towards sustainable business. 

Both of which mean that if sports organisations want to continue receiving financial and popular backing, they will have to ensure they are embracing the world of ESG and, in the words of Nico Rosberg, they must also embrace purpose.