"Your job now is to stand by our new (Senior) Manager" – Football Governance Act introduces senior managers to football
30 September 2025
Just as Sir Alex Ferguson's famous exit proclamation heralded the start of a new era at Manchester United, England's Football Governance Act 2025 (the Act) kicks off a new era in the governance of the beautiful game. The Act establishes an Independent Football Regulator (IFR) with oversight over the top five leagues in English men's football (see our article here for an overview of the new regulator).
The Act borrows heavily from concepts in existing regulatory regimes, including the financial services sector. The extent to which the IFR will be inspired by financial services was made clearer in the publication of three consultation papers in September 2025, setting out the IFR's draft rules and guidance in respect of:
- CP 1/25: Owners, Directors and Senior Executives Regime;
- CP 2/25: Information Gathering and Enforcement; and
- CP 3/25: Sanctions.
Of the new rules, one of the proposals which caught our eye was the introduction of prescribed senior management functions (SMFs) for regulated clubs, and further proposed guidance on the IFR's application of the Act's "suitability test" for determining an individual's capacity to fulfil these roles. Those with experience of the financial services industry will recognise these concepts as echoing the Financial Conduct Authority's (FCA) Senior Managers and Certification Regime (SMCR).
While the financialisation of modern football is well documented, regulating football clubs in the same manner as financial institutions is novel. It represents a challenge for clubs to ensure that their governance arrangements are compliant with the new regime. We consider the IFR's proposals and the lessons we can learn from the SMCR.
SMFs: the new big 6
As part of a club's application for an operating licence under the Act, it will be required to set out the specified SMFs performed by each of the club's officers. Incumbent senior managers will not automatically be subject to the IFR's suitability test at the point that either the Act comes into force, or the club first becomes regulated (i.e. clubs that are promoted to the National League - tier 5 of the English league system - will be grandfathered into the new regime). Senior managers will become subject to the IFR's suitability test if a club intends to appoint them after this initial point, or if the IFR becomes aware of grounds for concern in relation to an existing senior manager.
The draft rules for the Owners, Directors and Senior Executives Regime propose six categories of senior manager for regulated clubs:
- SMF1 (Chair function) - the function of having responsibility for chairing the board of a regulated club, and overseeing its performance;
- SMF2 (Chief Executive function) - the function of acting in the capacity of a chief executive (or quivalent) of a regulated club for the conduct and management of the whole of the business of the regulated club;
- SMF3 (Chief Finance function) - the function of having responsibility for management of the financial resources, financial planning, and financial reporting of a regulated club, including reporting directly to the board of that regulated club in relation to its financial affairs;
- SMF4 (Chief Operations function) - the function of having responsibility for the internal operations of a regulated club;
- SMF5 (Director function) - the function of acting in the capacity of a director (or shadow director) of a regulated club; and
- SMF6 (Significant Influence function) - the function of having a significant influence on the management or conduct of one or more aspects of a regulated club's affairs in relation to its regulated activities.
It is the last of these roles that raises the most questions.
CP 1/25 explains that "[t]he IFR has decided to include this function to ensure that highly influential individuals are not able to avoid the regime by holding a role that is not specified in the other Senior Management Functions, whilst continuing to have a high degree of decision making authority or influence over the club’s regulated activities."
The description of the "Significant Influence function" looks very similar to the SMF7 (Group entity senior manager function) under the SMCR regime. In the financial services sector, this function (which only applies to the largest/most significant types of firms) is often used to pull high ranking executives within parent companies into a subsidiary's accountability regime (i.e. the shareholder's senior management). The inclusion of such a function within the football world will create challenges and will likely lead to inconsistencies in approach among different clubs. It raises questions such as how frequently an individual needs to be exerting influence on a club's affairs to be captured by SMF6 and whether having a "sign off" on key decisions will tip the balance into SMF territory.
Subjective judgement is required to determine whether it applies in any particular case. A particular focus will be on its application to shareholders who may be viewed as essentially calling the shots at a club (despite not having a formal role on the club's executive team or board). There is also overlap between SMF6 and one of the tests to determine whether a person is considered a club "owner" in Schedule 1 of the Act – namely, "that the person has the right to exercise, or actually exercises, significant influence or control over the activities of the club (in whole or in part)".
This is significant as the Act places different requirements on individuals depending on whether they are acting as "owners" or "officers" (including senior managers) of regulated clubs. For example, officers of clubs must possess the requisite competence to fulfil their role by reference to their qualifications, experience and training (as discussed further below). This standard is not applicable to individuals who are solely classified as owners of clubs.
Depending on how broadly the significant influence function is interpreted and enforced, this blurring of the lines between ownership and acting as a senior manager may act as a barrier to potential new owners of regulated clubs wielding significant influence at their club if they do not meet the requisite suitability requirements. For example, would an actor or musician purchasing a club be prevented from wielding significant influence by virtue of their supposed lack of relevant qualifications, skills and training relevant to running a football club? Ditto for a Euromillions jackpot winner living out a childhood dream by purchasing their local club.
The point also leads to questions about whether the creation of this function risks undermining important principles of corporate governance. Does defining somebody with significant influence as a senior manager of a club undermine the traditional distinction between a shareholder, on the one hand, and the board of directors, on the other? And is it necessary? Many would argue that shareholders, as key stakeholders of the club, should be consulted by executives and directors on critical strategic decisions even if those decisions are ultimately taken by the board and implemented by the SMFs that are exercising day-to-day management control.
Suitability: a different kind of fitness test
Prospective senior managers at regulated clubs must satisfy the officer fitness criteria mandated by the Act, namely that they have the requisite:
- honesty and integrity;
- financial soundness; and
- competence.
Again, those in the financial services world will recognise these concepts from the FCA's "fit and proper" regime applied to those fulfilling senior management functions under the SMCR.
However, the proposed consultation guidance in relation to the IFR's interpretation of these criteria differs in specificity from the FCA regime. For example, both the IFR's proposed guidance and the FCA's fit and proper guidance focus on the impact of criminal offences in the context of suitability. However, the FCA's guidance gives examples of specific offences that may be problematic in this context (such as dishonesty offences), whereas the IFR's draft guidance is far less prescriptive (simply referring to criminal offences, or serious criminal conduct). It notes that that the IFR will not automatically find that someone is unsuitable if they have been convicted of a criminal offence.
This approach gives the IFR discretion, and reflects a general sense that the IFR is trying to give itself leeway to develop its approach. However, discretion creates legal uncertainty. This will no doubt lead to challenges where an individual's criminal conviction leads to a negative suitability determination. We have seen that when the financial services regulators have sought to ban individuals from performing roles in the industry (predominantly on the grounds of integrity), the application of the fit and proper guidance has often come under the microscope.
Negative suitability assessments by the IFR are subject to an appeal process. The IFR will first notify the individual that they are "minded to" find them unsuitable, and give the individual at least seven days to make representations on the proposed finding. The individual may then request the decision be reviewed by an internal reviewer at the IFR, who has 28 days to consider the decision. Decisions of the internal reviewer are then ultimately appealable to the Competition Appeal Tribunal.
Given that the ultimate result of the IFR determining that an individual fails the officer fitness criteria is denying them (or removing them from) a senior position at a football club, it can be expected that any negative determinations will be subject to strong challenges from clubs and individuals.
Kick-off approaches
The three consultations close on 6 October 2025, giving respondents little over a month to provide feedback on the IFR's proposals before final rules are subsequently released. A report published by Fair Game, an advocacy group, into the readiness of clubs for the introduction of the IFR found that only four clubs are considered as "regulator ready". Therefore, clubs should consider their governance arrangements in light of these proposals to ensure they are match fit ahead of the regime's implementation.
