Crucial lessons for business as Gina Rinehart axes Netball Australia’s $15 million sponsorship over ‘woke politics’

Netball Australia is reeling after mining billionaire Gina Rinehart’s Hancock Prospecting withdrew $15 million in funding for the struggling sport, just the latest in a slew of major fossil fuel sponsorships under fire in Australia this year.

It came after a week of turmoil over the Hancock branding on uniforms — the players association had rallied around Indigenous netballer Donnell Wallam after offensive comments from Rinehart’s father Lang Hancock regarding Indigenous sterilisation resurfaced.

In a strongly-worded statement, Hancock Prospecting and Rinehart herself together concurred that it was “unnecessary for sports organisations to be used as the vehicle for social or political causes,” continuing that “… there are more targeted and genuine ways to progress social or political causes without virtue signalling or for self-publicity”.

Netball Australia has four months to find a replacement sponsor for Hancock, with Prime Minister Anthony Albanese saying he hoped a corporate would step in to support the female-oriented sport which took a major financial hit during the pandemic.

Fossil fuels shown the door

It follows the high-profile breakup between Tennis Australia and fossil fuel giant Santos earlier this year, just one year after the “multi-deal” was announced, with some speculating it may have been related to Tennis Australia’s UN Sports For Climate Action pledge.

It also comes after Aussie Test captain Pat Cummins, a climate advocate and one of Australia’s most influential sportspeople, vowed not to appear in any more ads for Cricket Australia amid the final year of Alinta Energy’s four-year sponsorship.

Just last week, fans including writer Tim Winton and former Western Australian premier Carmen Lawrence called for the Fremantle Dockers to ditch its major sponsor, Woodside Energy, arguing that “it is no longer appropriate to have a fossil fuel company as our major sponsor moving forward”.

Crisis communication expert Kristen Zotti says it could be the beginning of upheaval in Australian sports where big sponsors that seek brand exposure to major sport’s expansive crowds can’t just buy their way in.

“It’s incredible to see major Australian sporting codes saying no to cash from corporations who don’t align with their mission,” Zotti, who founded Zotts & Co, said.

“There’s a movement of brands who are leading with a purpose that’s becoming impossible to ignore. More than ever, people expect brands to behave responsibly, beyond short-term profit interests.”

The power of the halo

So what can businesses learn from this? Pure Public Relations’ managing director Phoebe Netto says that, even when the increasingly unfashionable fossil fuel giants aren’t involved, sponsorship can be a double-edged sword.

“On the one hand, you’ve got the massive audience-pulling potential of everyone’s favourite personality or team, but on the other, you’ve got a huge helping of brand risk,” Netto said.

It can be described as the halo effect, she continues.

“The tendency for positive impressions of a person or team to positively influence their opinion or feelings of something completely separate”.

But this effect works exactly the same in reverse, Netto warns — any backlash a major sponsor receives, so too does the recipient of that sponsorship.

“Not all publicity is good publicity — you want to consider how that brand will improve your reputation, not bring it down.”

So how can a business safeguard itself against the reputational damage of a sponsorship gone oh-so-wrong? Simple, Zotti continues: do your homework and choose wisely.

“Sponsorships send such a powerful message to your customers about who you are as an organisation so it’s critical that you look to partner with brands that best reflect that.”

‘Be prepared for risk’

Crisis communication expert Sally Branson Dalwood, of Sally Branson Consulting, agrees.

“Before engaging in any sponsorship, business or organisations need to do the deep work of being clear on what their goals are, and where their business values are positioned,” she said.

“At the core, ‘reputation’ comes back to how businesses and organisations work within a framework of values and share these values externally.”

When it comes to sponsorship, like any business strategy, Branson continues, you’ve got to be prepared for risk.

“For anyone thinking of sponsorship, they need to be really clear on their reputation strategy, so if any issues arise, they’ve got clear steps forward to manage and mitigate any issue that may arise.”

Unfortunately, in the case of Hancock Prospecting, it seems it’ll be Netball Australia that suffers the greatest from the sponsorship withdrawal, not the billion-dollar Rinehart company.

“They don’t need to grow through sponsorship or have brand awareness,” Branson said.

“Their motivation for sponsorship is different from most other organisations. The simple explanation is that Netball Australia became more trouble than it was worth.”