Establishing financial stability and fair play regulations in Lithuanian Basketball League

Abstract

Sport is a major part of world’s economy. The uniqueness of sport is its competitiveness and the uncertainty of outcome. If levels of mentioned factors are high to maintain this uniqueness, big revenues will keep generating. Economic and sports scientists have been exploring ways how this competitiveness could be curbed and one of the most common schemes to do that was the introduction of financial const mechanisms in leagues regulations. The research problem addressed in this paperwork is to find out if and how the establishment of financial stability and fair play regulations (FSFPR) could improve the levels of Lithuanian Basketball League’s (LKL) competitive balance and contribute to financial sustainability of the league’s participantst. The object of the thesis is the financial stability of professional basketball league, while the aim is to present potential improvements for such regulations. To reach the final aim of this paperwork, following objectives were set, such as: to make theoretical and empirical analysis of scientific literature related to the theme of this thesis, to perform an analysis on the levels of competitive balance and examine the existing financial regulations in LKL, while comparing it to three European basketball leagues, finally, to explore the views of General Managers who currently work in LKL system. Field analysis part has incorporated a mix of research methods. Qualitative and quantitative approaches were applied to collect and analyze primary and secondary data focused on the research problem, which gave a descriptive and analytic issue viewing. The analysis made in part one and part two has provided with following results and conclusions. LKL levels of competitive balance are very low compared to top European leagues. Furthermore, it has also showed that comparing it a lower raked domestic basketball league the levels of competitiveness are behind it too. LKL has the least evolved financial regulations among other three leagues. Compared to them it is lacking transparency, codification, clarity, financial control subject, overdue control, budget control rules and disciplinary system, which causes concerns in regards of leagues future. Views of General Managers in LKL clubs only confirmed these findings by acknowledging the problems or ignoring the needs of changes. Finally, after indicating facts and excluding existing problems a systematic 3R approach was suggested, how FSFPR in LKL could be revised, re/established, and refined.