Leading Åland Island-based operator Paf, Chief Executive Christer Fahlstedt has implemented betting’s most transparent social responsibility mandate questioning standard practices that have governed incumbents operations to date.
Paf’s leadership directive hit news headlines home and abroad, however, Fahlstedt tells SBC that facing the industry’s most urgent agenda, his executive team has simply accepted its responsibility challenge head-on…
SBC: Christer thanks for this interview. How is Paf progressing on its responsibility agenda announced at the start of 2019?
Christer Fahlstedt: It has developed according to plan and with tougher local regulation, in Sweden especially we have seen quite a big change in our player base. We have received very good feedback from our customers and it has also been positively received by our employees. Having said that, it is still very clear to us that we have a very long way to go before we have a customer base in line with what the public think is an OK max loss. You don’t get many cheers when you say that player can “only” lose €30,000 per year in our company.
That is still an obscene amount of money to everyone who is not an insider in this industry. Someone mentioned €500 per month as a socially acceptable level…to get to that level and still be profitable we have a lot of work to do.
SBC: Leading Paf you have placed transparency at the forefront of operations and player engagements, why is this such an important discipline to deliver on?
CF: Our industry’s biggest issue is that we lack credibility in the eyes of the public and the authorities. The only way to remedy that is to be open and honest. I think we have quite a big task ahead of us here. There is also a big gap in terms of knowledge of how this industry works, we need to educate policymakers and media to get a balanced and constructive dialogue. To achieve this we need to talk facts and not shy away from the tough topics.
SBC: Furthermore you have sanctioned a number of casino-specific limitations… Put simply, has casino become a problematic vertical for the industry and its incumbents?
CF: I think this is a perfect example where we need a more balanced discussion. All gambling is dangerous to a degree, some types are more dangerous and some less, so comparing and contrasting verticals is difficult. To say that sports betting is safe and slots are horribly dangerous is not true and way of oversimplifying things.
At Paf we have roughly 15% of our GGR coming from sports betting, when we look at our biggest customers – where we have the highest risk of addiction – we see that they also have 15% of their losses in sports betting. From our data sports betting is as dangerous as slots. With the strong trend towards 24/7 live offering and ever faster markets (next throw-in, etc) we have to realize that sports betting cannot be compared to the situation 10-15 years ago.
SBC: Seeking to install progressive values across Paf operations, how hard has it been to challenge industry norms and set thinking related to care-of-duty on customers. Are the operator’s SR challenges a question of testing legacy values?
CF: Well, as an executive team, we do feel that we have gained the industry’s attention on social responsibility. We have a clear ambition to try to influence the industry in what we believe is the right and only direction. To do that we need to create noise and stir-up debate and discussion on a complex issue impacting multiple parties. However, I must admit that I have a great deal of sympathy for the execs of this industry. I have the luxury of having an owner who understands the long-term value of responsibility over short term profit motives governing a number of operators – that is very different to the situation faced by most other CEOs out there.
SBC: The industry’s 2019 agenda has been dominated by operators launching internal ‘corporate responsibility agendas’, as a sector stakeholder, do you feel that this is creating an unbalanced dialogue on the subject matter?
CF: This is a question, that I think we need to be really careful on. We don’t have many more chances in the eyes of the world around us and we must be honest and sincere in our efforts. I am sure this is almost always the case – but I am curious why everyone needs artificial intelligence to spot gambling addiction? I mean…come on really… have these operators ever looked at the deposit pattern of an addict? You don’t need artificial intelligence to spot that, you need just need to make an honest attempt to find it and it will literally jump out and kick you in the face. If we hide behind AI and other buzzwords and get caught not spotting the obvious then we are on the path to be labelled “tobacco” and will lose our last friends and supporters.
SBC: For 2019 and beyond what debate/discussion should be propositioned by industry leaders in solving SR dilemmas? What should be on the table?
CF: Compulsive gambling must be handled at the national level. It won’t help if one out of 35 operators restrict a player with an addiction. We must provide the authorities with the blueprint of a national deposit limit scheme. That way all operators will be in an equal situation and everyone will experience an equal drop in revenues. We can then protect the industry’s profitability by the fact that everyone will have less money to spend on acquisition and the media spend will drop. Today there is too much incentive for individual operators to take risks if we don’t move towards a unified system we will again be caught-out by bad actors and this could simply become a vicious circle.
SBC: Finally, what do you believe will follow this ‘age of responsibility’ for industry incumbents… What’s next for incumbents and will the industry ever gain closure on this subject matter?
CF: I believe that the sector will never gain closure on this matter. Gambling is like alcohol – for the amusement of the masses and the destruction of the few. This will always be a cause for debate. I read somewhere that this industry is at the crossroads between Alcohol and Tobacco. Before we have managed to stay well clear of Tobacco there will be no item even remotely as important as responsibility. But gambling is fun (just like I personally thing alcohol is) and when we have managed to stay clear of Tobacco we can start looking at becoming an entertainment industry.
Christer Fahlstedt – Chief Executive – Paf