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Dr Dan Parnell

FOOTBALL, SPORT, SOCIAL CHANGE, POLICY, MANAGEMENT

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Agents

Football agents should not be sent off – they just need a better set of rules

Originally published on The Conversation.

The war for talent is raging across the world. From Silicon Valley to Zhongguancun, organisations and institutions battle to recruit the best the world has to offer. So why is the football labour market viewed any differently to that of other industries and sectors? Surely demand for star players should be no different to the demand for product designers, data scientists and programmers.

Yet in light of the current controversies surrounding issues such as third-party ownership (TPO) and accusations of greed, and due to its mass market global appeal, football is different.

It seems strange then, that so little is known about the inner workings of the football machine – and in particular, those mysterious agents who grease the wheels, move the cogs and, apparently, make vast sums of money in the process.

Agent Jorge Mendes (left) on the red carpet. PA

Football agents make some of the biggest deals in football, sometimes profiting hugely from the talents of their superstar clients. Their role can be defined as “representing clubs and players within the context of contracts or transfer negotiations”.

Essentially, they are middlemen. But their role is increasingly growing to include responsibilities traditionally undertaken by the football club, such as being sold to another team. This raises the significant possibility of conflict of interest, when agents and clubs disagree about the player’s career path. Muddying the waters further is a hierarchy of power and division of labour within the role of agent so that some smaller agents work under the orders of the more powerful few.

So where do these agents come from? In a report on the big five leagues, just over half of agents had already worked in the football industry. Of these, 23% had a playing career, 13% scouted for players, 7.5% worked as a football manager and, 5.5% were sporting directors.

At the top of the profession, are the powerful few described by the media as “super agents”. Jorge Mendes is considered by many to be top of the pile, with clients including Cristiano Ronaldo, Diego Costa and Jose Mourinho among the £625m worth of contracts he has secured.

But given the current lack of transparency and regulation, all the agents and their dealings are difficult to identify, although they are viewed as the most powerful men in football.

Despite the significant number of people registered as agents in professional football, their presence is not evenly spread. A recent report highlights that representation in Europe’s five big leagues (England, Spain, France, Germany and Italy) is so highly concentrated that half of those leagues’ footballers are managed by only 83 football agents or agencies.

These increasingly powerful upper hierarchy of agents operate globallyacross divisions, leagues and continents.

Agent Jorge Mendes and the number of his transfers (thickness of lines) between clubs (circles), up until June 2016Widdop, Parnell and Asghar, Author provided

Public and industry opinion towards football agents remains hostile – Napoli’s owner, Aurelio de Laurentis, has described them as the “cancer of our world”. The media frenzy often directed at agents is adding pressure across the football industry to better regulate them. But football intermediary Jonathan Booker claims that it is those in football leadership, not the agents themselves, who have stood by and let this status quo continue.

And what about the agents themselves? Despite the fact that they should have a key voice in the debate about their role, you rarely hear from them. As part of our research we have interviewed football agents and intermediaries operating across the UK, Europe and beyond.

One of them explained that TPO has become common practice as a direct result of the economic recession, which led to financial institutions withholding loans, overdrafts and other financial benefits to clubs. He also argued that “the advantages [of TPO] can be multilateral”, explaining:

The buying club can obtain a player who will make their team better without having to pay the full amount the selling club is asking for. And the investor, whether that is an agent or consultant or company, will look for a return on that investment.

Addressing concerns about the impact of agent deregulation by FIFA in April 2015, he continued: “What does football expect? To become a coach in a professional club you need a relevant, often nationally accepted qualification. To become an agent you need to simply pay a small [£500] fee. This has created a context whereby a huge influx of agents have appeared, lacking due knowledge of regulation and impacting upon the system by continually approaching players with misplaced promises whilst trying to gain a living.

“It has opened the gate to the rogue agents that give all agents a bad name.”

FA as agents of change?

In the UK, the picture appears bleak, contradictory and dominated by big money. While we have strong calls by the FA for tighter local regulation, the Premier League is pushing for an easing in youth (aged 14-15) player regulation. This will no doubt heat up the chase for younger and cheaper players and will open up the disturbing reality of child trafficking and exploitation, when agents arrange ownership of very young players from developing countries. There’s no suggestion that the Premier League condones trafficking or exploitation of young players.

While agents call for global leadership and governance from FIFA to get rid of the rogue elements from their industry, many observers (and insiders) are treating this is a long-term aspiration (given they have enough to deal with already!). In the interim, the FA has an opportunity to lead and demonstrate a gold standard of practice, by heading up a coalition of stakeholders including the Association of Football Agents, the Premier League, English Football Championship and leagues, Players Football Association and government.

Complete transparency on all transfer and financial sensitivities, a formal and enhanced accreditation process and a national programme of education and training would allow the FA to protect its assets, repair its integrity, and position itself as a leader in football regulation.

The ‘Networked’ rise and power of the Football Super-Agent

By Dr Paul Widdop, Dr Dan Parnell & Tony Asghar

 

This summer, even for the hedonistic consumption of the Premier League, was unprecedented. Spending topped one billion pounds, with Manchester United breaking the World transfer record, in the region of £95million for Frenchman Paul Pogba.  Many within the football world were left dismayed that United payed so much for the Juventus player who the left the club for nothing in 2012. More disheartening for fans is the reputed 30% or if we conservatively round this down, the £20million fee super-agent Mino Raiola will collect.

Whilst football agents, the games infamous middle men, have been around since the early 1960’s , the term super-agent is only a recent arrival into the lexicon of association football. As money has flowed into the game, a powerful few have amassed enough resources to move from mere Agents to the grander media christened term ‘Super-Agents’.  Empirically of course it is difficult to typologise super-agents given the somewhat blurred boundaries, but we are told they are the most powerful men in football, not mangers, players, leaders of the games governing bodies, but agents.

However, what are we to make of super-agents and their networked world. Are they to be demonised as neo-liberal capitalists, fuelled by finance and commerce at odds with the cultural meaning of football as social institutions, or do they play a pivotal role in the production process, using there connected worlds to produce a global game.

It is somewhat easy to place all footballs ills at the doorstep of these business men. As Tony Asghar Managing Director of Revolution Global Sports Consulting Ltd and Masters in Sport Directorship student notes:

It is clear that the media and public perception of the role of the football agent has been dramatised as “the root of all evil” the people who “take money out the game” and “only think about themselves” , however on looking behind the curtain the role of the agent who represents a club in the transfer of player (buying or selling) or represents the player in negotiating an employment contract are necessities not only in football but in global commerce.

In this article, using a Social Network Analysis (SNA) we critically explore the networked rise of super-agents and how these structures give them power, resources and a means to restrict and skew the market. In doing so, we aim to provide both academic and industry insight.

 

The rise and role of the Super-Agent?

How did we get to this situation, where a powerful few have engineered a market-trading environment that not only facilitates a specific role for itself (agents), but one which would not function without them given their centrality to this market.  We consider that the rise in super-agent is fundamentally a network phenomenon.

We are interested here in whether this network takes away or restricts rational choice and constrains the trading market conditions, and ultimately whether this is positive or negative. Whilst it is difficult to define super-agents, it has been noted that a few represent the many, which has given rise to more networked with better connections than others (Poli, 2016). For Tony Asghar:

 “…the term Super-Agent has been tagged for a small number of agents (businessmen) who have created a business model which is clever and effective and is beneficial to the clubs who are working with them.”

However, it is clear that through their networks, super-agents have taken power from others and have created more for themselves. Perhaps the embodiment and archetypal manifestation of this is Portuguese businessman Jorge Mendes and his GestiFute networked empire.

Before exploring the networked nature of the GetisFute empire and its implications for global football, it is important to put the market and the agents role into context.

What is the role of an Agent

Agents can be described as those with the role of representing both clubs and players within the context of contracts or transfer negotiations, dealing with players image rights and carry out recruitment activities such as scouting (Poli, 2016). However, the actual role of agent (and intermediaries) has blurred boundaries. Fundamentally they are middlemen yet their role is increasing taking over responsibilities that were traditionally undertaken by the club. As Asghar notes:

“…representing the player in a contract negotiation requires payment whether it is a registered intermediary or a lawyer, whilst the credibility of a lawyer is not in question in most part (mostly due to the time spent educating themselves).

The role of an intermediary negotiating raises suspicion of lining their pockets. Intermediaries who are credible and have experience should only be looking for the best deal for their client and if this is matched by the club then the player is paid and the club may pay the agent fees on behalf of the player.

This is no different to any representation in entertainment, Media or other industry.”

Asghar believes the public scrutinise the role of agents for the most part because they don’t know exactly what they are being paid for:

“…most people agree that no person should sign a contract of any kind without seeking advice. Football players are no different. Perhaps the experience of an agent (who knows the market rate of salaries, knows how to structure a deal, knows the valuation of the player…) can be a lot more advantageous than an educated lawyer who may not have that experience.”

Asghar is also keen to raise awareness of all agents, not just those at the top of the pile:

“It is also important to note, that at present the public perception of agents who are making millions at the highest level of transfers does not alleviate for the majority of agents. Especially those moving players who are (i) free of contract (out of a job), (ii) not playing within a team, (iii) fell out with a manager and/or other reasons whereby time and effort are carried out (without payment) and not highlighted within the media.”

Jorge Mendes – a man at the top of the pile

Despite the significant numbers registered as agents, the market especially in the big European leagues follows somewhat of a power law distribution, i.e., more players are registered with a fewer number of agents. These agents gain further power and control becoming super-agents. We turn now to GestiFute and Jorge Mendes.

The rise in super-agents we believe is a network manifestation. The GestiFute networked business empire is illustrated below, it is an ego-net of Jorge Mendes.  To put this graph (network map) into context, the circles (nodes) represent football clubs and the line linking the two (an edge) represents a transfer between clubs (the players that Mendes represents).

The circle size is weighted on a measure of how often a circle falls along the shortest path connecting two other circle (football clubs), such that they might ‘broker’ between these parties (i.e., betweeness centrality). The lines (or transfers) are sized by number (or sum) of transactions between two clubs/circles. That means, the more transfers between the same clubs the greater the size of line.

sec-session-1

What does this tell us?

This is a basic sociogram and helps to understand the complex network structure that exists. The network of Mendes is complex. However, we identify six points to consider in this brief insight into this ego-trade network of a super-agent (up until June 2016).

  1. This is a truly global network covering approximately 88 football clubs across 15 countries, involved in 500+ transfers. Portugal still remains the heartbeat of the organisation, but Spain is becoming important in this network.
  2. Examination of the graph metrics show that there are relatively short lines linking a few football clubs. This perhaps makes trading patterns more predictable.
  3. The three giants of Portugese football, FC Porto, Benfica, and Sporting Lisbon are the most central in the network and the powerbase of the organisation. Interestingly, there is relatively very little trade directly between these three, indirectly this is different. That is, players don’t move from FC Porto to Benfica to Sporting Lisbon, and so forth.
  4. Smaller provincial football clubs play key brokering roles in this network. For example smaller clubs in Portugal, for example Maritimo and Rio Ave FC. It appears that almost serve to be used as a trading hub, whether older players getting one last transfer, or a test bed for two years of a young star before being traded off in the football circus. This will be possibly at odds with the traditions and beliefs of the supporters.
  5. This clearly demonstrates the network nature of this industry and gives initial insight into how these agents have become all-powerful.
  6. Finally, whilst it is interesting to see the football clubs that are part of the Jorge Mendes network it is also interesting to note those that are not. Leading us to raise further questions. What impact does this have on them when they are trading? Is the market restricted for these organisations? What about the economics of rational choice? Perhaps a better way to understand this market is transactionally or relationally – through the lens of relational sociology.

 

From an Agents perspective

From his deep knowledge of the industry, and understanding of the conventions and trading conditions of the market, Tony Asghar has somewhat of an alternative understanding of the network.

For Asghar:

“Jorge Mendes has created a network of players, clubs and managers with whom he has gained trust and respect as to being the man who can produce the best players for their clubs.

Mendes is a corporate head-hunter or talent finder who is no different to a Head-hunter is Silicon Valley or Hollywood as the “go to guy” to get the deals done.

There are other similar models by other agents working with a group of clubs and managers at lower level which again is bred by trust and ability rather than open a free market network to the ever increasing intermediaries after the de-regulation of FIFA agent regulations in 2015.”

Indeed, Asghar highlights that agents have an important contribution to the game:

“The issue of owning third party rights of players also comes into the world of the so-called super-agent, and although this is prohibited in the UK, FIFA and UEFA have still not regulated this type of transfer and Mendes and others have offered the service by purchasing a percentage of the player to allow the buying club to invest a more reasonable sum.

Like the banks and financial institutions used to provide loans for these fees, the super-agents are able to assist because they have the funds and more importantly have the experience and know the market and can make a calculated risk on their investment when moving a player say from South America to Europe and knowing he may accumulate club and international appearances and then be ripe for selling on to EPL or other top league for profit.

Therefore the commodities that players are becoming in the eyes of clubs and club owners are major financial investments and yes for every Pogba deal there will be a Falcao, some will work some will not.

The super-agent is becoming powerful but they are also becoming a necessity to the oligarch owners to make financial investment decisions on players, however managers will always have the say on players in order to create a winning team, and rightly so and in my experience most top level managers will not be swayed or overruled by a super-agent (if the player is not right for him), that will never happen.

Super-agents will be an exclusive and small band of football/business/relationship/social experts and even an agent who finds, nurtures a client that gets catapulted into super stardom then the super-agents are waiting to strike and offer that player into their exclusive club and why would the boys original agent say no, if he is getting a seat in the super-agents room, if only for a short time and not on the hard seats at the back of the room.”

The future

Clearly the network here only relates to Jorge Mendes and the players he represents. Therefore, this is not a clear portrayal of how the market is structured. Yet this does offers an insight into the networked characteristics of trading between clubs that warrants further investigation and critical thought.

This throws open questions of rational choice and utility models. In that clubs in the network, might be restricted by who they can trade with and for whom, whilst those clubs outside the network have barriers to entry into the market, given that this is an example of one of many super-agents in the market place.

What does this mean for smaller clubs? Are they destined to become small brokers or feeder clubs to the game’s elite? Will their players trading at the behest of external powers, or super-agents? It appears that power is ultimately being taken away from them as a single entity. They are at the behest of neoliberal forces that have significant access to resources and therefore power.

In a further development straight out of a text book example of Michael Porters five forces, the Fosun group who have a minority stake in GetisFute and heavily connected to Jorge Mendes  have entered into a new market and purchased a Football Club, it will be fascinating to view events unfolding at Wolverhampton Wanders founded in 1877. Indeed, it will be fascinating to see how Mendes and the Fosun group use Wolves to for their commercial gain.

At present elite level professional football continues to develop and extend its commercial power, whether in the English Premier League or in emerging football markets within the Global South. As such, we should expect the role of the super-agent to become more prominent as they grow their network and most certainly in their power to influence player transfers in football.

Perhaps the final word should be that of Asghars:

“The market is such that to have your club bring the biggest and best players, they need to call on the most expensive people and experts to provide the service. The culmination of transfer fees this window has exceeded 1bn and is excessive, however the market is dictating this and I don’t see it slowing down in the near future. A slow for deals at the top end or a slow for discretionary support at the bottom end”.

To contact the authors email: Dr Paul Widdop: p.widdop@leedsbeckett.ac.uk

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