Gina Rinehart may be Australia’s richest person, but she can’t buy Diamonds

Sascha: [00:00:02] From Equity Mates media. This is The Dive. I'm your host, Sascha Kelly. Last week, Australia's richest person, Gina Rinehart, sensationally pulled her $15 million sponsorship deal of the Australian Diamonds netball team. 

Audio Clip: [00:00:15] Squad member Danielle Vella expressed reservations about Gina Rinehart's company. Logo because of concerns over its record on Indigenous affairs.

Sascha: [00:00:24] It came after players voiced concerns about wearing a uniform that included branding from Rinehart’s company Hancock Prospecting. Gina Rinehart is no stranger to sponsoring sports organisations. She has existing relationships with Rowing Australia, Swimming Australia and the Australian Olympic team, amongst others.

Audio Clip: [00:00:42] Happy birthday, Ms. Rinehart. Thank you so much for your support over the past few years. I know I have struggled a lot with my serving, but without your help and support throughout many years, I wouldn't have done it without you.

Sascha: [00:00:53] It's Wednesday, the 2nd of November. And today I want to know, is the relationship between sporting organisations and their athletes changing? Is sports washing becoming more difficult? To talk about this today? I'm joined by the co-host of You're In Good Company. It's Maddy Guest. Matty. Welcome to The Dive. 

Maddy: [00:01:12] Thanks, Sash. Great to be with you.

Sascha: [00:01:13] I know you were a rowing champion in your day. 

Maddy: [00:01:17] Is that the lease term? 

Sascha: [00:01:19] Is that your sport of choice or are you a netballer as well? 

Maddy: [00:01:21] I would say I would identify more as a net bowler and then a big AFL fan. 

Sascha: [00:01:27] All right. Well, Maddy, let's get into the topic at hand. Can you give me a brief rundown of the Gina Rinehart and Australian Diamonds story, the Cliff Notes, so to speak? Who are the key stakeholders that we need to know about? 

Maddy: [00:01:39] Sash We'll start with the basics. Netball Australia is the main governing body for netball in Australia, affiliated to World Netball, which is the governing body worldwide. So earlier this year news broke that Netball Australia had accrued millions in debt throughout the pandemic and needed serious support in the form of a buyout or a funding boost in order to survive. 

Audio Clip: [00:02:02] Netball Australia has reportedly lost $7.2 million over two years with bank debts of around $4 million. 

Sascha: [00:02:10] Which brings us to last month when Netball Australia announced they'd inked a $15 million deal with Australian mining company Hancock Prospecting. 

Maddy: [00:02:19] Yes, somewhat of a lifeline. And the main thing to know about Hancock is that Gina Rinehart is the executive chair of the company, otherwise known as Australia's richest person. 

Sascha: [00:02:29] And she inherited the company from her father, Lang Hancock, and has been serving in that role since 1992. 

Maddy: [00:02:37] Correct. And the company has invested a lot of cash into Australian sport. It's the main sponsor of Rowing Australia, Volleyball Australia, synchronised Swimming Australia and Swimming Western Australia. 

Sascha: [00:02:48] So it sounds very straightforward so far, but money. I know you're eager to update me on what actually took place last week. 

Maddy: [00:02:56] That brings us to Donna Wallem, who made her debut for The Diamonds last week, just the third first Nations person to play for the national team in history and the first in almost 25 years. It was a historic occasion and a remarkable achievement. For while on her own, they began playing the sport professionally about a year ago, and she had an incredible debut, scoring eight goals from eight shots, including the match winning goal in the final seconds. What do you do. But unfortunately, the moment has been somewhat overshadowed in the media by an off court showdown relating to the Hancock sponsorship. 

Sascha: [00:03:35] Okay, so tell me what set off the dispute or controversy between these two parties? 

Maddy: [00:03:41] According to reports, while I spoke up at a team meeting prior to her first game expressing her discomfort wearing the Hancock Prospecting logo on her uniform. 

Audio Clip: [00:03:51] Just her culture sensitivities around the programme, around the partnership. She is obviously new to the group to come in here to actually just be herself and feel comfortable and strong. And I know that the girls are supportive of that. 

Maddy: [00:04:03] Now, the background here is that Jane, his father, who we mentioned earlier, made some very offensive comments in the eighties about First Nations people. So on those grounds, Wallem asked if she could be granted an exemption from wearing the Hancock logo on her uniform. While I'm reference Sonny Bill Williams, a rugby player who was granted an exemption from New Zealand Rugby and the Auckland Blues, allowing him to take over banking logos that were inconsistent with his Islamic faith, according to ABC reporting. After hearing Donnelly's objections, The Diamonds played without branding in their match against New Zealand late last week. While Hancock said in the statement there had been no expectation that the company logo would feature during games. It became a pretty big story. Not often is it that players are the ones standing up and objecting to sponsors. 

Audio Clip: [00:04:50] What do they say? Go woke and you go broke, right? And isn't Netball Australia about to learn that the hard way? 

Audio Clip: [00:04:57] I feel so proud of them standing up for what they believe in and it feels like such an opportunity now for another sponsor to swoop in and look awesome. Right? 

Audio Clip: [00:05:06] What did Mrs. Rinehart do wrong? Was deserving of people going on and those just a whole range of people from the diamonds. 

Sascha: [00:05:13] All of this led to Rinehart deciding to pull the deal. She didn't condemn the comments her father made in the eighties and she also released a statement slamming the team for, quote, virtue signalling, end quote. We should mention that the Victorian Government has announced it will step in and pick up this sponsorship deal. They're going to provide the 15 million to Netball Australia to support the game from grassroots to the elite level. 

Audio Clip: [00:05:37] We are really thrilled today to be able to announce a four and a half year sponsorship deal where Visit Victoria will become a significant sponsor for the Australian Diamonds netball team. 

Maddy: [00:05:47] I have to say as a proud Victorian and big netball fan myself, I think this is an excellent investment by the Government. 

Sascha: [00:05:54] It's just good to know that someone stepped into the fray, isn't it, Maddy? So let's move back to Hancock Prospecting and Gina Rinehart as both have been accused of this, Tom, that we've talked about a little bit already and that is sports washing. And this isn't the first time that this claim has been levelled at them. So let's dig into it. What exactly is sports washing? 

Audio Clip: [00:06:16] She has a reputation for maintaining a relatively low profile, but made a rare public appearance in these commercials aired during the Olympics. The ads celebrate her donations to the Australian Olympic swimming team. 

Maddy: [00:06:32] So in short, it's when an individual group, corporation or country uses sport to improve its reputation and public image. The Beijing Olympics in 2008 and the 2014 Sochi Winter Olympics were seen as classic examples of countries using sport to fix a so-called image problem. So whilst the term itself is relatively new, sports washing is actually a phenomenon that arguably extends back as far as the 1934 football World Cup, which was hosted by Mussolini's fascist Italy, or the 1936 Olympics hosted by Hitler's Nazi Germany.

Sascha: [00:07:08] And sports washing is really about how powerful sport is in reaching a large audience, which continues to be amplified through globalisation and then also just how accessible sport is now via streaming services and social media. 

Maddy: [00:07:24] That's right. But these days we should really think of sports sponsorship as more of a co-branding relationship. Whilst it's obviously attractive for corporations to try and win the hearts and minds of consumers by their affiliation with sport. The transfer of value goes both ways. The sport or sports team is also impacted positively or negatively by the brands that they align with. 

Sascha: [00:07:45] And that brings us full circle in this story. Large audience means larger dollars, right?

Maddy: [00:07:51] You're not wrong that the sport sponsorship market is booming with record amounts of money flowing into marketing with athletes, sports teams and sporting events. According to Brand Essence Research, sports sponsorship is expected to reach over 140 billion Aussie dollars in the next five years. 

Sascha: [00:08:09] That's massive. 

Maddy: [00:08:10] And in the same way that environmental and social governance or ESG is becoming increasingly important for investors and company leaders alike. The same can be said for sports clubs, who today are focussing more and more on the ethical implications of sponsorship on both their own. Image and their athlete.

Sascha: [00:08:28] That's such an interesting point, Marty. The ESG movement just seems to be infiltrating all aspects of our lives. I do want to unpack that. But first, let's just take a quick break. 

Maddy: [00:08:51] Welcome back to the dive. I'd love to say a big thanks to everyone who has left us a five star review, including this really kind to enrich that great podcast. Sascha does a great job finding interesting stories that do. 

Sascha: [00:09:02] Well. I don't actually find all the story that's a little behind the scenes a secret. It's the full team who work so hard. Which brings me to the fact that I'm joined today by Maddy from your own good company who wanted to talk about this idea of sports washing. Because we've been digging into the story about Gina Rinehart pulling her $15 million sponsorship deal from the Australian Diamonds netball team and some of the history around this term. Maddy, you made an interesting point that the tide might be turning in terms of the relationship between sports organisations and the athletes and the reflection of ESG in this arena. What other instances have we seen lately where players have stood up and said that they don't support or want to play because of these sponsorship deals? 

Audio Clip: [00:09:48] We have learnt that progress has been made both on paper and in practise. The kafala system has largely been dismantled. Working conditions have improved and a minimum wage has been established. 

Maddy: [00:09:59] Well, just last week we saw the Socceroos become the first World Cup team to speak out against Qatar, the host of next month's FIFA World Cup.

Audio Clip: [00:10:08] Whilst the reforms established in Qatar are an important and welcome step, the implementation remains inconsistent and requires improvement. 

Sascha: [00:10:16] The Socceroos being Australia's national soccer team, is that right?

Maddy: [00:10:20] Correct. Or football?

Sascha: [00:10:21] Sorry.

Maddy: [00:10:23] 16 players released a video message reading lines from a collective statement outlining their concerns with the nation's human rights record. This included their treatment of foreign workers and restrictions on the LGBTQ community. Those players also had the support of the broader squad, as well as Football Australia, who released a separate statement declaring that the tournament has been associated with suffering for some migrant workers and their families and this cannot be ignored. 

Sascha: [00:10:51] So we've seen the Socceroos coming together to speak out about human rights. What about examples of individual athletes taking a stand? 

Maddy: [00:10:59] Well, Sascha, the captain of the Australian cricket team, Pat Cummins, has been in the news recently voicing his concerns about the team's sponsorship with one of Australia's biggest polluters, Alinta Energy. 

Audio Clip: [00:11:11] Not just I suppose, you know, every organisation has a responsibility to do what's right for the sport. 

Maddy: [00:11:17] Cummins has publicly declared that he won't be participating in any publicity for the energy company. It's worth noting that Cricket Australia has also announced that they'll be ending their contract with Alinta this year, which is earlier than expected, although they have said that this is nothing to do with Cummins' stance on the issue.

Sascha: [00:11:35] Alright, so those are two Australian examples that we've talked about. What about on the global stage? Are we seeing this play out there as well? Pun intended. 

Audio Clip: [00:11:45] I'm Alyssa montano. I'm an Olympian. I'm a national champion. And I've been one of the top three runners in the entire world. And I'm a mother.

Maddy: [00:11:56] We sure are. It wasn't long ago that tennis superstar Serena Williams spoke out about not his decision to freeze sponsorship payments for pregnant athletes in May of 2019. Several athletes came together, led by American track star Alicia montano, to make a video calling Nike out over their treatment of pregnant athletes. Montano described the extreme lengths that she went to, including taping her abs together to ensure that her contract wasn't cancelled after her pregnancy for not meeting Nike's lofty performance standards, this video ultimately led to Nike reversing its decision. 

Sascha: [00:12:32] So the Australian diamonds aren't the first or even the only example of this term of sports washing. But it does come in a period where the temptation to take these huge money deals has never been higher. Let's talk about live golf, the Saudi backed golf tournament, and potentially a new cricket tournament, which is also backed by the Saudi sovereign wealth fund.

Maddy: [00:12:54] You're right. We did an episode on live golf specifically a few months ago, but sports washing can accomplish its goal in a few different ways. The most straightforward one is through owning a prominent club or hosting a mega event like the World Cup. It allows state or company leaders to promote themselves in a positive light with reputation enhancing messaging over a sustained period. This can be as simple as burying undesirable Internet search results through sheer volume and relevance. Let's take guitar as an example. If you Google Qatar and the first page of results all pertain to the World Cup. Fewer people are going to make it to later pages where you'll find results pertaining to human rights violations. In other words, they're able to sort of distract away from the moral violation that the sport's watching addresses. 

Sascha: [00:13:41] So that's one way that sports washing works overshadowing the negative issues with the excitement and the enthusiasm for these. Major sporting events. What else is there?

Maddy: [00:13:52] Yeah. A similar yet distinct effect is that of minimising the moral violation, for example, by relegating it to a position of relatively less prominence than the mega sports event, rather than causing fewer people to be aware of or attend to the issue. Minimising changes the context in which the violation comes to people's attention. Making it seem less urgent, extensive or important. Even more worrying, perhaps, is that sports washing could have the effect of normalising the issue. The ramifications here are that certain audiences cease to even view the moral violation as a violation at all. 

Sascha: [00:14:27] It is crazy to think that this is effective, but I can completely understand how it is. Well, using people's love of sport to diminish what we could otherwise agree is a fairly serious issue when something of urgency and importance completely agrees.

Maddy: [00:14:41] Sporting events and clubs are often associated with such a powerful array of positive emotions. That feeling of being surrounded by other supporters and watching your favourite team succeed, it really is something else. The fact is, sport provides an arena in which people readily engage with one another, form communities, and reinforce each other's shared emotions. And when these emotions are aligned with the owner of your beloved sports club or the host of a cherished event, it's easy to see how sports washing can create such a halo effect. 

Sascha: [00:15:11] A really interesting topic. Thanks so much for unpacking it for me today, Maddy. If you've enjoyed this episode, then please tell a friend about it. Take a screenshot, share it, tag us on socials. We love to hear about it and we love to thank you publicly. And it's just the best way for our podcast to grow. If you've just joined us for the first time, then welcome. Go check out our back catalogue. Matty also appeared on an episode called To Help Me Feel Better About Inflation, and she certainly did just that. So if you're a fan of Matty's, then go check out that episode or make sure you subscribe to your in good company, which Matty Carr hosts. Remember, you can follow us on Instagram at the Dive Up Business News. You can contact us by email thedive@equitymates.com And you can subscribe wherever you're listening right now so you never miss an episode. Maddy, thanks so much for joining me today. 

Maddy: [00:16:00] Thanks, Sash.

Sascha: [00:16:01] Until next time.