Fossil fuel companies sponsor sports teams to build social capital, not sell products

When an oil and gas company buys logo space on an AFL jersey, it isn’t trying to convince fans to buy its products.

Fremantle Dockers supporters cannot, for example, go to their local service station to buy a barrel of Woodside Energy oil or a canister of its liquefied natural gas.

This differs from the way most companies’ sponsorship deals are designed to convince consumers to buy their hamburgers, drink their beer and bet on their platform.

When Fremantle’s number one ticket holder, Tame Impala frontman Kevin Parker, wore the team jersey with the Woodside logo covered on tour during his team’s finals push, it reignited demands to drop the oil and gas sponsor over its contribution to rising temperatures.

This all raises an obvious question: if a fossil fuel producer doesn’t sell to the public, why spend millions putting its name on a footy jumper in the first place, and subject itself to public criticism?

‘Good feeling’

Companies like Woodside tend to sponsor sporting teams and community organisations to stockpile social capital, a reservoir of goodwill they can draw on to absorb the shock of inevitable public backlashes.

Fossil fuel companies, in particular, want to retain strong public support as they rely on state and federal policymakers – and sometimes local councils – to expand and operate. Community-led opposition movements can frustrate their projects.

This helps explain why extractive industries seek out highly visible sponsorship deals with the sporting teams closest to their operations.

The Australian business arm of Indian conglomerate Adani, known as Bravus, sponsors the North Queensland Cowboys, positioning its brand alongside a regional club near its coalmine.

Prof Emma Sherry, dean of school of management at RMIT University, says companies that have “complex relationships” with local communities often direct money to sports because they hope to build on fans’ emotional loyalty to their favourite teams.

“We often see that money go to the arts, and of course, we often see it in sport,” says Sherry, who specialises in sport management.

“What the companies are trying to do is use people’s love for their team to create a similar good feeling towards the company.”

None of this is in itself nefarious, as there’s an unwritten social contract that companies give back to the communities they work nearby.

But the issue is complicated when the high-profile sponsor is at the forefront of the carbon-emitting business, and is trying to use sport and other community activities to change views.

When Woodside and Fremantle renewed their long-term sponsorship deal at the end of 2024, the oil and gas company included an awkwardly worded claim that the two WA-based organisations both had a “focus on sustainability”.

That position recently became harder to defend after Woodside scrapped its long-term emissions and clean energy targets.

In response to the “Woodside, get off my chest” campaign calling for the sponsor’s removal, a company spokesperson said Woodside was committed to its partnership with the Dockers and was “looking forward to continuing our work together”.

An investigation by climate communication charity, Comms Declare, found that major coal, oil and gas companies are reaching children through schools, museums, science centres, sporting clubs, and other youth programs.

Many of the institutions that accept the companies’ funding are “operating under genuine financial pressure and are providing valuable services to children and families”, it found.

With sponsorship of 47 programs – including having its name emblazoned on the surf singlets worn by kids in the beach “nippers” program run by Surf Life Saving Western Australia – Woodside features heavily in the report.

‘We’ll have to stop playing’

The link between fossil fuel companies and sport is not new; oil and gas company Santos is a major commercial partner of the Wallabies and energy company Alinta Energy previously served as one of Cricket Australia’s main sponsors.

Yet fan unease is growing into a familiar backlash, much like the rising community resistance to promotional efforts by sports betting platforms.

Just as big tobacco once felt indispensable to rugby league, large commercial deals can make fossil fuel companies seem untouchable, right up until the culture shifts and alternative sponsors step in.

While the AFL grand final is forecast to be played in cool conditions on Saturday, large parts of Australia, including Victoria, have just emerged from their hottest winter on record.

Sherry says that growing climate awareness, particularly among younger fans, is showing sporting codes how a changing climate threatens their future.

“Sport relies on the natural environment to be successful. For example, we have heat policies, and if the temperatures keep going up, we’ll have to stop playing,” says Sherry.

“It is one of those things that’s becoming increasingly visible, not just from a sponsorship perspective, but also people realising that, if I’m in a snow sport and the snow melts, then my sport doesn’t exist.

“Or if I rely on grassy fields to play, and there’s a drought, I won’t be able to play.”