The last nail in the European Super League coffin? JP Morgan PULL their £3.5BILLION backing of the doomed breakaway and say they ‘misjudged’ it after English clubs pulling out saw their sustainability rating get downgraded to ‘NON-COMPLIANT’
- The American bank have pulled out of backing the European Super League
- The Premier League ‘Big Six’ clubs were the first to withdraw on Tuesday night
- Other clubs in Spain and Italy have followed but some failed to bow to pressure
- But after seeing their rating drop to ‘non-compliant’, JP Morgan have pulled out
JP Morgan have pulled out of their £3.5billion backing of the European Super League after plans for a breakaway competition fell through this week.
The Premier League ‘Big Six’ were the first to withdraw from the Super League on Tuesday evening, just 48 hours after they formed half of the founding members of the new competition.
But protests from fans and pundits around the country at grounds and on social media eventually saw Manchester City, Manchester United, Arsenal, Liverpool, Chelsea and Tottenham pull out.
JP Morgan have pulled out of their £3.5billion backing of the European Super League
Protests from fans and pundits saw the Premier League Big Six withdraw two days after it was founded
WHY DOES JP MORGAN’S SUSTAINABILITY DOWNGRADE MATTER?
Sustainability ratings agency Standard Ethics downgraded JP Morgan’s credibility rating from ‘adequate’ to ‘non-compliant’ earlier this week after integrity issues were raised about their role in the European Super League.
The agency cited the ‘serious negative effects’ of the Super League plan on the bank as the reasons behind the downgrade, just hours before the breakaway league collapsed after English clubs pulled out.
JP Morgan’s boss, Jamie Dimon, earlier this month added ‘reputation was everything’ to companies like his own and underscored the great importance of ‘community’
Atletico Madrid and clubs in Italy have since pulled out of the controversial breakaway too, though Real Madrid and Barcelona have failed to bow to pressure and remain part of the league.
But in a blow to the LaLiga duo’s hopes of staging the competition as soon as August this year, the American bank has now revealed is it withdrawing funding for the Super League.
In a statement, JP Morgan said: ‘We clearly misjudged how this deal would be viewed by the wider football community and how it might impact them in the future.’
‘We will learn from this.’
According to The Guardian, JP Morgan’s bankers committed £2.8bn (€3.25bn) to the ESL plan, mainly for a payment of between €200m and €300m to each participating side.
The statement comes just a couple of days after sustainability ratings company Standard Ethics downgraded the investment bank’s credibility rating from ‘adequate’ to ‘non-compliant’ after questions were raised about their integrity following the initial announcement of their backing of the Super League.
Standard Ethics rates companies by evaluating their sustainability and is modelled on credit-ratings agencies, but the agency did not absolve the 12 clubs involved in their role in the creation of the Super League of any blame either.
‘Standard Ethics judges both the orientations shown by the football clubs involved in the project and those of the US bank to be contrary to sustainability best practices, which are defined by the agency according to UN, OECD and European Union guidelines, and take into account the interests of the stakeholders,’ a statement said.
The agency cited the ‘serious negative effects’ of the plan on the bank as the reasons behind the downgrade, and which were all highlighted further by UK Prime Minister Boris Johnson, his Italian counterpart Mario Draghi, and France’s President Emmanuel Macron.
Manchester City were the first to officially withdraw before the other five teams joined them
JP Morgan’s boss, Jamie Dimon, earlier this month added ‘reputation was everything’ to companies like his own and underscored the great importance of ‘community’.
‘To a good company, its reputation is everything,’ Dimon wrote in his annual letter to shareholders. ‘That reputation is earned day in and day out with every interaction with customers and communities.
‘When I hear examples of people doing something that is wrong because they could be paid more, it makes my blood boil – and I don’t want them working here.’
JP Morgan suffered as a result too, with their rating dropping from ‘adequate’ to ‘non-compliant’
The company charges a fee to some corporations to grade them based on their performance in environmental, social and governance matters, albeit JP Morgan’s rating was unsolicited.
While the American bank have therefore suffered reputational damage, they appear well placed to take any financial hit that may come their way having reported a record £10.3bn ($14.3bn) profit in the first quarter of this year.
The first fiscal quarter of 2021 began on New Year’s Day and ended on 31 March.
However, any punishment meted out to the clubs involved has yet to be decided, with reports in Spain claiming Champions League chiefs want to kick Real Madrid out of this year’s semi-finals and ban them and Juventus for a year for being the Super League’s ring leaders.
Meanwhile, Chris Sutton called for the Premier League ‘Big Six’ to be hit with a 12-point deduction and a ban on competing in Europe following their plot to join the Super League.