Here’s how Man City’s governance caused this nightmare

Man City’s bad governance has been exposed. The club can fight all it wants, but events like this will always shine the spotlight on its leaders. 

If you haven’t seen this story yet, to put it simply, one of the most improved, most successful teams in soccer’s most lucrative league has been found guilty of serious breaches of financial rules. 

From an all-time low in the late 1990s, the club has risen to become a major power in British sports – sometimes through on-field moments of victory that made TV history – but it now appears that much of this journey coincided with severe and intentional wrongdoing, according to an independent commission that released a 40-page summary document in September 2026. 

In short: Man City is found guilty of funnelling money from its owners into the club through sham sponsorship deals, to the tune of nearly GBP900 million. 

Based on the extensive documents we now have available, showing us the extent of the mismanagement, the only conclusion is that governance is at its heart.

• The club began a bounce back in the late 2000s, under new ownership of Sheikh Mansour bin Zayed Al Nahyan, via the Abu Dhabi United Group (ADUG). A massive restructuring followed. 
• Mid-2010s: Team victories started coming in, both in domestic competition and across Europe. Some of the winning moments captured on screen were nothing short of pure sporting euphoria. 
• However, in 2018, German publication Der Spiegel’s published an investigative series documenting years of financial rule-breaking, including contract manipulation and fraud around sponsorship funds. 
• Mid-2020s: Following a formal referral and extensive investigation, the Premier League charged Manchester City with 115 counts of financial rule breaches, misrepresenting accounts, and failing to cooperate with official inquiries. An independent disciplinary commission later found the club guilty on 114 out of 115 charges.

Corporate governance – or at least good corporate governance – is supposed to establish clear processes for guiding a business, ensure it respects the rules, balances the wishes of different stakeholders and, crucially, mitigate risk. 

Everything about Man City’s current predicament highlights flaws in these areas – flaws that were not only allowed to continue, but grow. Any good team of corporate leaders is able to balance ambition with compliance, oversight and control. In Man City’s case, one was consciously decoupled from the other. It’s a basic recipe for disaster. 

The traditional “lines of defence”, like risk management and internal audit – which are supposed to be independent and heavily influential in business decision-making – were made subordinate to executive strategy. That strategy was only towards expansion. 

The tone at the top normalised this expansion at the expense of anything else – a blatant “we do what we like” attitude that bulldozed through the idea of internal checks and caution. 

Moreover, where other corporate scandals are fed by leaders simply failing to do their duty, this one has gone a level further, as the summary report shows consistent intent to misrepresent the origin of funds crucial to the club’s growth and success. It hammers home just how powerless proper governance processes were to stop such extensive wrongdoing.

One word: independence 

The club’s board should have maintained a healthy degree of independence from the overly ambitious strategy to be able to question it, and stop it in its tracks whenever necessary. 

This is a formula we see all the time in publicly traded companies with diverse ownership. Man City – like most English football clubs – has no such structure. It is privately owned, meaning the small pool of primary stakeholders have much more freedom to fill the crucial bodies like the board with whomever they want. 

In a lot of cases, this means filling the board with “yes-people”, individuals who share common interests and will sign off on executive decisions without serious questioning. 

It’s perfectly legal and fine if it works well. Obviously, though, in this case, it ultimately failed catastrophically. And no matter what different leaders might say about the arrangement, it is not good corporate governance for the modern era.

Man City’s board had the following fatal flaws in its independence: 

• Key board members held concurrent senior roles within the executive organs of the Abu Dhabi government, creating conflicts of interest through blurred lines between who owned the club and who was its operating entity. This ultimately mattered a lot when it came to the origins of the investigated funds. 
• A lack of independence on the board meant there was no serious capacity for independent audit – internal oversight of all funds and whether they complied with fair-market principles and Premier League rules. 
• The focus on rapid growth went unchallenged for several years, during which other more independent governance setups would have questioned decisions multiple times. Man City’s hierarchical governance eliminated any possibility of necessary checks and balances.

Not in a hurry. The club has maintained that it is innocent and has promised to be “relentless” in challenging the results of the investigation in whatever way it can. 

So, while the guilt isn’t final, it seems the club’s leadership are set on the position they’re taking: they’ve done nothing wrong, there are no flaws in its governance structure, and therefore it won’t pursue any kind of boost in board independence unless it is forced to. 

While it might seem like a shocking position after being found guilty of 114 or 115 charges, the small pool of owners means it’s easier to adopt these positions and present a united front. 

The problem is that privately owned entities like Man City often have a much wider pool of non-controlling stakeholders – in this case, the fans of both the club itself and those rival clubs who feel that City’s success is the result of cheating. 

Scandals like this destroy trust among those stakeholders. Making no attempt to change once the results are known is a big risk for winning back that trust.