A Word From Your CEO

GH listens to Todd Greenberg so you don't have to

A hard concept to sell

While the campaign to introduce private capital to the Big Bash League is in at least public abeyance, it ticks over elsewhere. At the weekend, Joe Aston released a podcast interview with Cricket Australia’s CEO, Todd Greenberg, on his website Rampart - which, by the way, Et Al recommends, as there is nobody quite like Joe in exposing Australian business’s numerous vanities and hypocrisies.

Unfortunately, the interview was recorded before the fur really flew at the Junction Oval and Jolimont, but it is worth checking out for the insight on Greenberg’s thinking. He also goes interestingly into some of his own background, and discusses something for which I’ve always admired him - his steadfastness as a partner when wife Lisa was battling chronic alcoholism in the 2010s:

No, that was something I kept completely to myself. And in referencing that time, probably one of the learnings would be not to isolate yourself as much. I took all that on myself at the time, so no one knew. It was a matter for Lisa and I to deal with. You know, I've got a huge admiration for Lisa, this is her story to tell. But she made huge changes in her life, and as we sit here today is about to celebrate eight years of sobriety. So I'm enormously proud of that. But at the time, there's pretty difficult moments, you know, you're dealing with an issue at home, you're dealing with an issue at work.

It is not the same, of course, but the way Greenberg describes Australian cricket also has a semblance of addiction, in it being conditioned to ever-expanding wants.

One is we have significant revenues, but we've got a lot of mouths to feed. There's a huge number of distributions that need to be made across the entire sport, and that continues to get more difficult year on year as expectations grow, and the types of things we want to invest in continue to rise. So, more revenue will help, but I think finding efficiencies and making sure we put our money where our investments are needed is critical.

For Greenberg the solution is what’s being called ‘privatisation’, but is more precisely a species of asset recycling, of the kind in vogue with state governments much of the last decade. Greenberg stresses the ‘future fund’ that CA envisions as the prime repository of proceeds released from essentially selling future revenues.

Well, the primary amount of that money, Joe, is designed to create what we call a future fund. So, in other words, Cricket Australia's balance sheet’s pretty ordinary. We spent a lot of money in COVID to make sure the game continued. So, the idea being for the first time in our sports history, and a windfall of cash won't be distributed. So the idea that we don't distribute it to players or we don't distribute it to states, we hold that centrally, we diversify our income, we use the interest generated off that investment to power the rest of the sport, and then when we get to 2031 and we renew our broadcast deal, we've got a diversification of our revenue stream, and we've got a little bit more leverage at the table in order to make sure you get the best deal for the sport.

There’s a few things to say here. Firstly, that cricket must be the only sport around still complaining about COVID, in the timing of which it was actually pretty fortunate - the England Cricket Board, whose season was beginning as the blight descended, had it a great deal worse, and Australia never had to confront the rigmarole of suspending a season or staging a Test match in an empty stadium. Secondly, Greenberg provides no detail on how the windfall would be invested (‘And so, whoever holds the keys to where that money is invested, let's put that to one side’), how it can be guaranteed that after discounting for the players’ cut the return could be guaranteed to outpace inflation/the BBL’s endogenous growth trajectory, and how it looks for CA to go short cricket and long, say, equities and data centres. Thirdly, anyone watching the states bicker among themselves over the BBL would be pardoned reservations about their ability to manage a quantum of money.