A Structural Relations Analysis of the Corporate Governance Practices and Performance Indicators of Brazilian Football Clubs

This article analyzes the structural relationships between the degree of adherence to good corporate governance practices by Brazilian football clubs and their respective performance levels: sporting, economic and financial. Using an exploratory approach, a structural model for the analysis of these relations was elaborated based on the recommendations of good corporate governance practices of the IBGC (Brazilian Institute of Corporate Governance). This model captured five dimensions of the level of governance of Brazilian clubs: disclosure, governing boards and their structure and functioning, property rights, ethics and conflict of interest, and social benefits generated. The governance scores (index) obtained for each club were used in analysis by means of two structural equations models to identify the relationship between these scores and performance variables. The study investigated the 27 clubs that make up divisions A, B and C of the Brazilian league, representing 134 million fans. Despite the low levels of governance practiced by Brazilian clubs, significant and positive relationships were found to exist between the governance construct measured and the sports performance variables and the economic and financial performance variables. Additionally, the variable "size" (measured by the number of fans) was inserted in the model and a positive and significant relationship was found with the degree of adherence to good governance practices.