Worcester City Football Club:  The case for change to a Community Benefit Society

Back on the 9th July 1928 Worcester City followed the lead of many other football clubs at that time by incorporating as a private limited company.

Worcester City Football Club had been formed in September 1902 when another Worcester based club, Berwick Rangers, went into liquidation. The Birmingham League agreed to let City take over Rangers’ fixtures. The Club moved to St. George’s Lane in 1905.

Admirably our forefathers were forward thinking and inserted certain clauses into the original constitution to try and retain the spirit and collective ownership of the club. A great example of this was the 1% rule;  no one person could hold more than 1% of the shares. It was an early attempt at bringing in fan ownership and protected the club from a single large investor taking a majority holding.

It is somewhat ironic then in keeping with the same spirit of collective community ownership, a policy the Supporters’ Trust has long held since its inception, that this very clause is preventing the Club becoming a Community Benefit Society (CBS). To become a collectively owned Club the CBS must control 50% +1 of the shares and so for this to happen there must be a change in the constitution.

A CBS exists to serve the benefit of the wider community. Assets are protected and held collectively. Money that the club makes must be reinvested back into the CBS. It has community objectives written into the constitution and is recognised by public bodies and grant funders as a community body that exists to achieve shared interests. Membership fees are kept low so it is inclusive to all and it advocates a one member one vote system irrespective of an individual’s ability to invest.

Under the CBS model the football club would be able to attract a wide range of grant funding for the development of a ground from amongst others The Big Lottery Fund, it will be able to issue community shares and have access to a range of other community funding initiatives. Ultimately the Supporters’ Trust believe a change in the club structure will create more opportunities. It will help encourage a greater number of people to get involved and to just feel part of the Club. A football club run by the community for the community.

The Football Association list Locality, Social Investment Business and Supporters Direct as organisations to contact to help move forward in this process. WCFCST is a member of locality, has already received SIB funding and is a member of Supporters Direct

So the 1% rule equivalent to a 3000 shareholding was radical and relevant in 1928 but of course this kind of shared responsibility and ownership only works if all shareholders take an active role and contribute. Of the 160,000 or so of allocated shares in the company, today there is typically 60,000 ‘active’ shares and consequently the business is controlled by around 30,000 i.e. 10 shareholders. It can no longer be heralded as fan owned.

The Supporters’ Trust firmly believe in the advantages of the Club becoming an open and transparent Community Benefit Society. They continue to pursue the planning appeal for the new stadium at Perdiswell as the best route to bring City home.

Over 100 sports clubs in the UK use the CBS model including many football clubs, AFC Wimbledon , Exeter FC, Motherwell in Scotland, Wrexham AFC and FC United of Manchester to mention just a few.

A CBS attracts new forms of investment such as Community Share offers, which have been used by other clubs to raise funds for projects (such as new grounds) As an example Lewes FC raised £200,000 of funding via a Community Share offer for their 3G training pitch, they also received substantial grant funding which was only available to a community owned organisation.

Another example is Bath City FC. Bath City Supporters Society (CBS) originally formed in 2003 to enable dedicated supporters of Bath City to acquire substantial community ownership of the club. In 2017, it achieved this goal after raising over £350,000 in a community share offer.

Supporters Direct have produced a detailed briefing paper on the Business Advantages of Supporter Community Ownership in Football which can be accessed by clicking here.