ESG – Compliance and Sustainability by Jonna Danlund, Head of Sustainability at Betsson Group
The iGaming industry prides itself on its continuous work for safeguarding consumers. Whilst many not involved in the igaming industry will assume this is due to stringent regulatory requirements, igaming organisations are investing more and more into expanding player protection teams and implementing tools that serve to exceed, not just meet, the requirements of the regulator. The industry cares not just about its reputation but the safety and welfare of its customers also. To run a long-term, sustainable business, having customers who gamble in a healthy way is key.
The ‘duty of care’ concept, or the recognition that organisations must keep stakeholders safe, is not new. This obligation used to be limited to the actual workplace – keeping your employees or customers safe at the office or place where you offer your services. However, over the past years, the online entertainment world (including the igaming industry) has expanded this duty of care to its customers – i.e. ensuring players’ safety whilst using online sportsbooks or casinos.
Compliance is a critical business issue, one that shapes the ESG framework. It is also heightened by the stark reality of facing hefty fines, reputational damage or losing customer trust through non-compliance. Enhanced compliance is the lynchpin of any ESG strategy and a crucial part of any sustainable igaming business.
Protecting vital business infrastructure and assets, as well as players themselves and keeping on the right side of the regulatory fence, is viewed by some organisations as a box-ticking exercise driven by legislative requirements. But compliance is a moving target, and no business is impervious to the compliance challenges that this hyper-connected digital world presents.
For businesses looking to scale quickly, enter new markets, expand across geographical borders and diversify their client base, governance and risk management must be on top of the business planning agenda. The amount of contextual data available to igaming businesses from a consumer’s digital footprint is phenomenal. It’s imperative to recognise that technology plays a transformative role in all aspects of compliance and to understand how this ties in with an organisation’s overall approach to a robust ESG framework.
There’s a distinct opportunity for igaming organisations to turn compliance from a necessary regulatory-driven process into a value-added function and leverage the benefits of responsible and sustainable practices. For any ESG strategy, organisations must collectively view compliance as an asset instead of a hindrance.
Educating the workforce is imperative for the employees to be the first line of defence. Having skilled resources with a deep understanding of the benefits of compliance and how this links to sustainability is paramount. Clear roles and responsibilities, a competent and confident workforce that fully understands the material risks and implementing effective training methods help to improve responsiveness to business needs and regulatory requirements.
The regulatory landscape and rising customer expectations are paving the way for the digital transformation of compliance. The application of cutting-edge technology, the automation of critical processes and advanced analytics play a pivotal role in improving risk management and effectiveness. Compliance isn’t just about keeping player data safe to avoid fines or having a well-documented KYC process. It’s a case of building public trust in the igaming industry, attracting positive media attention, increasing transparency and managing reputational risk.
The convergence of compliance and sustainability through an overarching ESG framework will deliver opportunities for increased efficiencies, rapid innovation and enhanced corporate social responsibility. In a saturated market where competitive differentiation and brand management are critical, compliance remains a centrepiece of a sustainable and profitable business.
The igaming organisations focusing on establishing a robust ESG framework and creating C-Level roles to oversee the implementation of such with purpose and passion are enhancing their influence in the industry. There’s a huge opportunity to differentiate services based on trust, and the link between customer loyalty and higher revenues is tangible. Good compliance is good for business.