Why Brazilian football teams need to behave like companies

The English Premier League is the world’s richest and highest-profile league – grouping six of the top 10 most valuable clubs of the world. While part of its financial success is due to the billions of petrodollars poured in by oligarchs and millionaires with checkered pasts, the high level of professionalization of the clubs also comes into play. For starters, the clubs themselves own the league, not England’s Football Association. They negotiate broadcasting rights as a united front – and it has become the top source of revenue for the world’s most powerful teams.

According to consultancy L.E.K., Brazilian football teams should look to England as something to emulate. First, however, clubs need to change their entire organization model. Most of them are still social clubs, with paying members and multiple sports, such as basketball, volleyball, and swimming. In order to become more profitable, they need to become companies, in which football is treated separately.

Of the 20 Brazilian football teams analyzed by L.E.K., 14 posted losses in 2016 – either because they’ve spent too much on signings, or invested too much money on new stadiums. The problem is that no one is held accountable for their frequent poor decisions....