As lucrative as it can be, the Olympics still proves to be an extremely expensive event for most countries to host, according to census pulled from 500 business executives.
Discussing the business of sports and the coming Olympics at the Global leadership summit held by London business school, 67% of the audience, including corporate finance leaders, agreed that the cost of hosting this prestigious event is much too high for most countries around the world. It is estimated that London’s Olympics 2012 is costing the around $17 billion (9 billion, just as the Beijing Olympics of 2008 is reported to have cost close to $40 billion (20 billion).
Even as countries around the globe struggle to cope with the financial turbulence of current, the cost of organising such a major event may be too prohibitive for many countries. The main concern for many is likely to be centred on monetary issues and financial management, although bidding to host the Olympics concluded before the start of the global recession.
Whilst many felt that the costs of the event were too steep for most countries, a 67% of others at the event also believed that the investments generated off the back of the Olympics games is substantial and highly beneficial for the host country.
Speaking at the event was Andrew Scott, professor of Economics at London Business School who chaired a team on the impact of major sport events. According to Professor Scott, “”There’s a lot of evidence to suggest that hosting an Olympics boosts trade significantly. It’s a wonderful symbol of a country’s commitment to the world and to trade.”
The census carried out with business executives who attended the global leadership submit also revealed future predictions in the sporting industry. Many believed that Asia with receive the most growth in sports in the next 10 years, with UK and Europe witnessing 4% growth, followed by Russia with 2% and America 1%.
According to survey, football was predicted to receive the highest growth over the next five years, by 44% of the audience, while rugby received 14% of the vote followed closely by 13% vote for basketball.
The event which attracted some of the most innovative minds in sports, business and corporate finance such as, Andrea Agnelli, chairman of league-winning Italian football giant Juventus, and Sean Fitzpatrick, Founder, Front Row Leadership and former New Zealand All Blacks captain, was centred around business and sports, educating on the similarities shared by both industry.
Professor Andrew Scott and London Business School academic colleagues, including Lynda Gratton, Professor of Management Practice were joined by Sir John Armitt, Chair of Olympic Delivery Authority, and Beth Comstock, Senior Vice President & Chief Marketing Officer, GE.