The global sports economy could be worth as much as $8.8 trillion by 2050, up from $2.3 trillion today, however climate and environmental risks could put much of this growth at risk, a report by Oliver Wyman has found.
Oliver Wyman‘s report, Sports for People and Planet, which was undertaken alongside the World Economic Forum, suggests that the global sports economy is set to enjoy compound growth of 10% over the next five years, to be worth $3.7 trillion by 2030, however escalating climate and nature risks, along with rising physical inactivity, threaten up to $517 billion of this revenue.
If current trends continue, potential losses could be worth as much as $1.6 trillion by 2050.
‘Investment and risk’
“As well as exploring key growth drivers that are shaping the global sports economy, this report identifies three distinct pathways that reflect sport’s unique impact, including championing resource stewardship, placing sport at the heart of cities and catalysing purpose-driven capital flows,” commented Tony Simpson, partner and sports practice leader at Oliver Wyman. “This analysis has the potential to help organisations with investment and risk, as well as with insurance considerations that support this industry.”
It also identifies four potential growth drivers: the expansion of sports tourism, the development of sport as an asset class, the growth of women’s sport and increased participation from emerging economies.
Environmental concerns
Among the environmental risks identified by the report are heat stress, extreme weather and rising pollution levels, which have already impacted competitions, spectator experiences, and community wellbeing initiatives.
These risks are heightened by the ‘resource-intensive’ nature of many sporting events, along with infrastructure and travel requirements, which result in significant carbon emissions, water use and waste generation.
“Sport blends economic power and cultural influence in ways few other sectors can match,” commented Sebastian Buckup, managing director, World Economic Forum. “This paper illustrates how public, private and civil society leaders can harness that potential to shape a new model of prosperity that delivers not only financial returns, but healthier societies and thriving natural ecosystems – outcomes that are imperative for sustained economic growth and societal well-being.” Read more here.
