Cementing the role of D&I

Gone are the days of forming a directionless committee with a vague goal of “increasing diversity”. Now, D&I requires a measured approach supported at all levels of the business.

According to Christina Thakor-Rankin, principal consultant at 1710 Gaming Ltd and board advisory co-founder at All-In Diversity Project, D&I programmes can only succeed “by making it everyone’s business”. No halfhearted approach will work.

CHRISTINA THAKOR-RANKIN, PRINCIPAL CONSULTANT AT 1710 GAMING LTD, BOARD ADVISORY CO-FOUNDER AT ALL-IN DIVERSITY PROJECT

“Responsibility for having an organisation that is diverse and inclusive sits with the company, not a group that already sits outside of the company’s definition of a ‘typical’ employee,” she says.

It’s important not to burden already marginalised communities with the errand of fixing problems that directly impact them while other co-workers can go about their business as usual.

“D&I programmes work best where there are visible role models and where middle management – that key tier that is the gateway to senior roles – is fully supportive of the company’s D&I strategy,” Thakor-Rankin continues. “This has to be a shared burden, with the key decision makers and influencers being as vocal and involved as the people they support.”

Ani Akimyan, head of HR at Technamin says D&I programmes are fundamental.

“They’re the key to equality and fairness in the workplace,” she says. From this perspective, the workload is allocated fairly without burdening anyone.”

“In a truly inclusive culture where D&I programmes are implemented correctly, there are no borders or biases. This means that no community will go underappreciated or overlooked within the company, giving everyone the equal opportunity to contribute to its success while enjoying the resulting benefits.”

Making D&I programmes work

Justin Carter, SVP of regional operations at Penn Entertainment, cites a “village approach” to diversity.

JUSTIN CARTER, SVP OF REGIONAL OPERATIONS, PENN ENTERTAINMENT

“When I say that,” he explains, “I mean it includes everyone. It starts at the CEO and the board. It doesn’t work if we don’t have buy-in from the top down.”

“And then we get to the senior management level, and everyone has to have a vested interest in making it work. It permeates the entire organisation.”

Thanks to its leadership’s support, Penn has seen most of the company embrace diversity programmes.

“I have managers calling me asking to run programmes for the Pride parade or finding unique community events to get involved in,” Carter continues. “We’re not just driving things down from the leadership level. We let the organisation tell us what they want, and we’re set up to implement those initiatives quickly.”

Laura Da Silva, director of SG:certified has similar thoughts. According to her, it’s important to let the larger communities within a business take the reins and speak openly about what they want.

“We can succeed by involving employees in the planning and implementation process, providing resources and support for their participation, and being open to feedback and adjustments as necessary. It’s everyone’s job.”

For D&I programmes to succeed, they need to exist within a framework of wide-spanning investment and open dialogue. Everyone needs to believe in what the organisation can accomplish, and they must have the resources to make it happen without resistance.

Moving the needle

Building a D&I committee and getting investment at all levels is just step one. A big step, but still just the beginning.

Next comes the work of making meaningful change. We’ve already seen one example with Carter and the Penn Diversity Committee. But what does it take at a high level to implement significant change?

LAURA DA SILVA, DIRECTOR, SG:CERTIFIED

It’s not about simply ticking a box to say you have a D&I programme. It’s about using the resources available to a business to strike out and make an impact.

“Certain practices need to be in place to have a working mechanism for a D&I policy, starting with recruitment and the education of managers on the benefits of D&I culture,” says Akimyan. “Creating equal job opportunities for everyone, fair performance management, equal pay policies, promoting a sense of shared experience, and the celebration of different cultures and traditions are all actual practices that go beyond ticking a box and bear fruitful results for companies.”

“In today’s working climate, the more diverse and inclusive a company is in terms of employee background, the higher the chances of its success.”

Carter emphasises the importance of listening, harking back to his point about avoiding a top-down approach. Everyone has a voice and every voice is important.

“We’ve done things like ‘days of listening’ where throughout the company, we dedicate a week to just shutting up and listening to what people have to say,” he says. “And this is outside of your typical engagement survey, which we also do. It’s purely for listening. And you get some amazing stories.”

“And, you know, we’ve had leaders of our various properties and business units come back and say, ‘You know what, I didn’t even realise that we did this, and you know what, people didn’t like it. So we need to think differently.’”

Thakor-Rankin lists five ways a company can apply their D&I strategy to foster success.

Ani Akimyan, head of HR at Technamin

“First, a genuine commitment to D&I and sharing it with everyone, inside and outside the company,” she says. “Next, communicate expectations to everyone in the company, whether it’s a D&I policy or part of your mission statement.”

“Third, develop a framework of internal policies and practices to ensure those expectations are brought to fruition. Fourth, support the initiative with ongoing training, education and awareness. And finally, measure, assess and evaluate. Move forward and change your targets if something isn’t working properly.”

D&I takes effort. It takes change and reframing. It takes support and resources.

It’s hard work, but it’s worth it.

Read part one here.

GAN launches strategic review following FY22 revenue growth

GAN said growth across both its B2B and B2C segments helped revenue increase during its 2022 financial year, while the provider was also able to report a rise in revenue for the final quarter of the year.

With GAN looking to build on this success, the business said it would now launch a strategic review to assess a “range of strategic alternatives” that could improve shareholder value.

While GAN said the intention is to complete the process in a timely fashion, there can be no assurance that the review will result in pursuing or completing any transaction, while no timetable was set for completion of this process. 

“As part of our commitment to improving our returns for shareholders, we have launched a formal strategic review process to evaluate options available to hasten our path to better profitability metrics and a more attractive return profile,” GAN chief executive Dermot Smurfit said.

“We hope to complete this process in a timely manner and will certainly provide updates as appropriate.”

Q4

Looking at GAN’s performance last year and beginning with the fourth quarter, revenue in the three months to 31 December 2022 amounted to $36.9m (£29.8m)/€33.8m), up 15.0% on the previous year.

Breaking this down, B2B segment revenue increased 25.9% year-on-year to $14.1m, due to a rise in platform and content licence fee revenue from existing clients and new launches by existing and new customers.

B2C revenue also jumped 18.8% to $22.8m, helped by a 49.0% rise in the number of active customers, with GAN noting a significant increase in the Latin America market.

Turning to costs, operating expenses were 389.0% higher at $182.4m, with the mainly due to a $137.1m non-cash impairment charge. GAN also noted $1.2m in other costs, which left a pre-tax loss of $144.3m, in contrast to the $6.6m loss posted in Q4 2021.

GAN received $3.4m in tax benefits, meaning it ended the quarter with a $147.7m net loss, compared to a $6.9m loss in the previous year. However, adjusted EBITDA loss improved from $6.0m to $400,000.

Full year

As for the full year, revenue in the 12 months to 31 December 2022 was up from $124.2m in 2021 to $141.5m.

B2B revenue climbed 18.4% to $54.0m, with GAN putting this down to a rise in platform and content licence fee revenue from organic growth within the US real-money igaming business.

B2C segment revenue also climbed by 11.3% year-on-year to $87.5m again primarily due to active customer growth in Latin America.

Operating costs jumped 115.3% to $334.0m, mainly as a result of $166.0m in impairment charges, while after also accounting for $1.0m in additional income, pre-tax loss stood at $193.6m, compared to a $30.8m loss in 2021.

GAN received $3.9m in tax benefits, meaning net loss for the year reached $197.5m, in contrast to $30.6m in the previous year. Adjusted EBITDA amounted to $6.0m, up from a $2.8m loss in the 2021 financial year. 

“Our fourth quarter continued to show strong B2C KPIs as we grew active customers by nearly 50%, Smurfit said. “We also ended the year with solid momentum in our B2B sports betting business as we announced our partnership to support WynnBet at Encore Boston Harbor and had a highly successful launch last month. 

“This marks our third GAN Sports client in the US and we maintain a healthy pipeline of potential future partners for the platform.

“At the same time, it has become apparent to us that the capital requirements to gain market share for initiatives such as SuperRGS as well as in certain competitive markets for sports betting like Ontario, Canada do not provide a path toward achieving an acceptable ROI in a reasonable period of time. 

“As such, we have elected to allocate capital away from these endeavours and toward more appropriate growth strategies. Accordingly, we are focused on leaning into the value that GAN Sports has demonstrated thus far and being a market leader in emerging Latin American markets through our B2C operations.”

Africa: How local operators can outmanoeuvre the power players

The Africa opportunity is significant, but the jurisdiction has been something of a sleeping giant until recently with some operators hesitant to get in on the action. This has changed in recent months, with the likes of 888, Entain and Bet365 finally making their move.

Some operators have been cautious about Africa due to the challenges the market presents. There are plenty of hurdles to clear, from infrastructure to data costs and the significant number of feature phones still in circulation. Regulations can and do change, too.

Then there is also the cultural factor, with significant differences between African countries and ultimately the entertainment and betting habits of the people in each. But by overcoming these challenges, operators can leverage the tremendous potential on the table.

Christophe Casanova, COO and co-founder, Honoré Gaming

Local experience

This applies to smaller operators as well as the titans of the industry. In fact, the local tier-two and tier-three brands are incredibly well-placed to deliver an experience that not only meets but exceeds player expectations in each market.

Their local experience can be their greatest advantage, especially those with a retail betting footprint. Bettors across the continent still like to wager in person, and if they do bet online or via mobile, they prefer to do so with a brand they know and trust. But this means operators must now deliver a compelling multi-channel betting experience, starting with retail.

It goes without saying that localisation is key here, too. But what features do retail bookmakers need to provide in order to engage players? These are some of the most important:

Booking code – African bettors like to place 8+-leg combos, so tools that speed up bet placement are essential. Booking codes do this. Event IDs and bet types are given codes which are printed onto coupons to help bet shop cashiers place bets faster. Coupons must be optimised so that they contain the maximum amount of information but use the minimum paper as this is expensive in Africa compared to other markets such as Europe.Book a bet – internet and data costs are incredibly high in most African countries, so operators need to allow bettors to prepare their bet slips within their retail shops and then validate them at cashier machines. This feature is also used by influencers on social media when promoting operator brands. This share your bet feature is available via Honoré’s retail product, allowing its operator partners to leverage the power of influencer marketing.Rebet – African bettors like to place “close bets” where one or two selections from their 8+-leg combo are modified. So instead of creating a new code or having to add up to eight bets separately, a rebet feature makes it much easier for the player to re-wager. With the rebet feature, the agent can add all pending bet lines of an existing bet slip and then amend them based on the player’s modified selections.

Technical difficulties

Of course, the retail offering is just one part of the experience and operators need to ensure their online and mobile sportsbooks are as heavily localised for each African country they target.

The biggest consideration is undoubtedly the technical landscape they must navigate. While this differs from market to market, broadly speaking they will have to contend with limited bandwidth and high data costs for consumers.

This, combined with feature phones still being in circulation, means that front ends must be stripped back with all the bells and whistles removed. A super lightweight Android app is also a must as this is the operating system that dominates mobile devices across the continent.

Despite the technical limitations, players still expect a comprehensive sports betting experience including a good selection of markets and odds – this is a critical point of difference for operators and puts tremendous weight behind having a marketing-leading trading division.

Loyalty pays

They also expect bonuses, and to be rewarded for their loyalty. Again, a localised approach is required here.

At Honoré Gaming, we’ve developed a loyalty scheme specifically for the African market. It takes a level-up format with players able to earn reward points for every bet they place – the higher the expected margin of the bet, the more points the player receives. 

There are six levels in total and the system has been designed in a way that ensures between 20% and 30% of active players can clear at least the first level of the scheme each month. 

Players are always able to see the number of reward points they hold as well as how many more points they need to reach the next level. They can also see how many points they could earn based on the active bets they have placed. 

What’s more, the scheme considers the average number of bet lines that African players place, which ranges from seven to ten depending on the country, and the day-to-day philosophy that most players adopt which is why it provides weekly redemption and not monthly redemption.

Entering the market

Payments are also a key consideration. Huge swathes of the population remain unbanked and those that are, tend to prefer mobile banking solutions such as M-PESA. Gateways, therefore, need to allow for cash deposits and include a wide range of local banking methods.

These are relatively easy challenges to overcome, and the local operators who do and leverage their knowledge and experience of the market will be able to claim a significant share of the wallet in each African country they target.

The big boys may have made their play, but local operators can outmanoeuvre them by combining their understanding of the market and player preferences with a multi-channel platform that provides the flexibility they need to succeed.

Christophe Casanova is the co-founder and chief operating officer of Honoré Gaming. His career started in investment banking before he co-founded Casanova and Associates, a statistical modelling and algorithm development company with a focus on football matches, tournaments and events. He set up Honoré Gaming with his brother Cyril in 2013.

ITIA bans tennis umpire for life over manipulation breaches

Carrero, who is from the Dominican Republic, was ruled to have committed 16 breaches of the Tennis Anti-Corruption Program (TACP) across a total of eight matches.

He was also found to have manipulated match scoring in a handheld device to facilitate guaranteed betting wins on specific points in matches at ITF M15 tournaments held in the Dominican Republic in November and December 2019. 

Carrero had been provisionally suspended by the since 1 March last year while the case proceeded, though the formal sanction means he will be permanently prohibited from officiating at or attending any sanctioned tennis events organised or recognised by the governing bodies of the sport.

Specific breaches of the 2019 TACP included D.1.d, whereby no covered person shall, either directly or indirectly, contrive, attempt to contrive, agree to contrive, or conspire to contrive the outcome, or any other aspect, of any event.

The ITIA also flagged section D.2.b.i, which relates to how anyone approached over match manipulation or related activity should report this to the ITIA as soon as possible. 

European Parliament committees approves raft of new AML/CTF legislation

The first piece of legislation is the EU “single rulebook” regulation, which aims to standardise AML/ CTF policy amongst a number of different domains. The bill includes provisions on crypto-currency, new financing methods such as crowdfunding, company ownership, “golden” passports or visas and on the conduction of customer due diligence.

MEPs within the committees overwhelmingly backed the text of the regulation at 99-8, with six abstentions. Under the new rules, a provider of gambling services will be required to apply due diligence upon the collection of winnings, the wagering of a stake, or both, when carrying out transaction that amount to at least €2,000.

“golden” passports and visas are to be banned

 “We cannot tolerate the corrupting influence of dirty money in our political system any longer,” said Spanish MEP Eva Maria Poptcheva. “In the wake of Qatargate, Parliament heard this message loud and clear.

“Dirty money is not just a threat to our democracy, it also fuels inequality and injustice,” she added. “Ordinary citizens struggle to make ends meet while criminals prosper with the complicity of systemic corruption. This has to end.”

New caps are to bet set up on certain kinds of transaction – which a €7,000 cap for cash payments, and a €7,000 cap for cryptocurrency transfers where the customer cannot be identified.

Possible gambling exemption

The regulation does allow for member states to exempt certain gambling services from the new rulebook “with the exception of casinos”. This may be done on the basis of proven low risk, or the small scale of the business’s operations.   

In order to qualify for an exemption, EU Member States will be required to carry out a risk assessment looking at possible AML/ CTF vulnerabilities and mitigating factor if the gambling service, the risks linked to the size of the transactions and payment method and the geographic area where the gambling services are administered.

While it is not clear exactly how this will work in practice, it may mean that jurisdictions that are on or have been on the radar of international money-laundering watchdogs like the Financial Action Task Force (FATF) may find themselves subject to an increased AML/ CTF burden.

Updating of 6AMLD

The second item in the legislative package is an updating of the 6th Anti-Money Laundering Directive (6AMLD), which was first issued in 2021. The new text contains provisions harmonising the supervision and operation of Financial Intelligence Units (FIU), which are government bodies set up on the member state level to “prevent, report and combat” money laundering and terrorist financing.

In order to detect money laundering schemes and freeze assets in time, FIUs and “other competent authorities” are to be given access to information on beneficial ownership, bank accounts and land registers.

Information on certain goods considered attractive for criminals – such as yachts, planes and cars worth over €200,000 – is also to be aggregated on the member state level. FIUs are to cooperate with each other internationally, as well as with the new EU-wide money-laundering organisation set up as another provision of the new legislation.

“We are losing the battle against money laundering, which costs society up to two trillion US dollars annually worldwide,” said MEP Paul Tang. “That is why parliament worked together on finding effective ways to fight money laundering, by demanding the registration of expensive cars, boats and planes and by obliging the disclosure of all goods stored in free zones.”

Establishment of new authority

The final piece of legislation concerns the European Anti-Money Laundering Authority (AMLA), which is to be given supervisory and investigative powers to ensure compliance with AML/ CTF obligations.

The new organisation is to monitor threats from within and outside the EU and classify a number of financial and credit institutions by risk level. The body will be able to mandate companies and people to hand over documents and other information, conduct on-site visits if approved by a judge, and impose sanctions amounting up to €2m, or 0.5-1% of annual revenue for breaches to the rules.

The AMLA will also be able to fine entities up to 10% of total revenue for the preceding business year.

“We need to draw a clear distinction between national supervisors’ powers and the direct supervisory powers of AMLA,” said MEP Emil Radev. “In addition to directly supervising selected entities, AMLA will promote high standards, convergence, and the creation of a common culture among national supervisors.

“It will also help us overcome problems arising from a lack of coordination between various national supervisory authorities and Financial Intelligence Units. In the end, we hope that the newly created authority will guarantee more financial security in a cross-border environment where risks have been constantly growing.”

While progressing through the committees is a significant step forward, the package still needs to be approved by the Parliament. MEPs will begin negotiations on the legislation after the April plenary.

IOC makes funding commitment to combat manipulation in Olympics

The funds will be made available to the Olympic Movement Unit on the Prevention of the Manipulation of Competitions (OM Unit PMC) to reinforce monitoring around the Olympic Games and Youth Olympic Games.

The IOC said the new fund will also expand the number of monitored events organised by International Federations (IFs) and multi-sport event organisers, as well as consolidate the worldwide education and awareness-raising activities of the OM Unit PMC.

Established in 2017, the OM Unit PMC works with the Olympic Movement, as well as with external stakeholders including governments, law enforcement and sports betting entities, to tackle manipulation in Olympic sports.

The Unit has established model rules, an awareness-raising campaign and an intelligence system for the entire Olympic Movement. Its work is based on a three-pillar strategy of regulation and legislation, awareness-raising and capacity-building, and intelligence and investigations.

The IOC itself has been active in the prevention of competition manipulation since 2006 and in 2015 created the Olympic Movement Code on the prevention of manipulation of events.

The most recent edition of the summer Olympic Games took place in Tokyo, Japan in 2021, one year later than planned due to the Covid-19 pandemic. The next summer Games will be hosted in the French capital of Paris next year.

The 2022 Winter Olympic Games were staged in Beijing, China, with the next edition to take place across the Italian cities of Milan and Cortina d’Ampezzo.

Allwyn hails growth strategies as revenue and earnings climb in 2022

The past 12 months proved transformational for Allwyn, with highlights including securing the fourth UK National Lottery licence in September. This is due to commence in February 2024 and run for a period of 10 years.

Allwyn also struck a series of major acquisition deals including Camelot UK Lotteries, current operator of the UK National Lottery, with the deal completing last month. In December, the group also agreed to acquire US-facing Camelot LS Group and finalised the deal earlier this month.

In addition, Allwyn in April 2022 agreed with a subsidiary of OPAP to acquire its 36.75% interest in the business activities of Kaizen Gaming outside Greece and Cyprus, completing the purchase in December. 

These acquisitions, Allwyn chief executive Robert Chvatal said, will help drive further growth across the group as it seeks to build on its success of recent years.

“I am pleased to report that Allwyn achieved another year of strong financial results in 2022, reflecting our continued successful execution of our organic and inorganic growth strategies,” Chvatal said.

“These results demonstrate how much the business has progressed in the last several years, with both total revenue and EBITDA growing by over 90% since 2019 – during which time we also deleveraged by more than 1x adjusted EBITDA, significantly increased our ownership in our existing businesses, and strengthened our platform and increased our strategic optionality and diversification through securing entries into the UK and US markets. 

“While delivering this strong performance, we have remained focused on our responsibilities to all our stakeholders and on safer gaming.”

Preliminary results

Publishing preliminary figures for its 2022 financial year ahead of releasing the full results next week, Allwyn revealed that consolidated total revenue increased 23.8% year-on-year to €3.22bn (£2.83bn/$2.50bn).

Of this total, €3.81bn was attributed to gross gaming revenue, which was 24.0% higher than in the previous year. Allwyn said its record performance reflected strong growth across all geographies and product lines.

The increase, Allwyn said, was primarily driven by its online channel, as well as by a strong performance of its casinos business in Austria and internationally, which was impacted by the Covid-19 pandemic in 2021.

The group noted that the acquisitions of Camelot UK and the Camelot LS Group closed after the end of the period, while the increase of its interest in Kaizen did not impact the results. 

Aside from revenue, adjusted EBTIDA also increased, with the €1.17bn reported in the 2022 financial year being 20.8% ahead of €966.8m in the previous year. Growth was primarily driven by the strong revenue growth, with margins broadly stable in all markets.

“Overall, I am very pleased with Allwyn’s financial and strategic performance in 2022 and the start of 2023 and believe we are well placed for the next chapters of our growth story,” Chvatal said.

“I would like to thank the entire Allwyn team for their hard work and for seizing opportunities to progress our strategic priorities and am very much looking forward to working together with them and with new colleagues from Camelot in 2023.”

Allwyn is due to publish its FY22 results in full on 3 April.

Fanatics, Hard Rock and PointsBet pledge support to RGC

Launched last September, the group is committed to establishing industry-led responsible gambling standards, with Bally’s, BetMGM, DraftKings, Entain, FanDuel and MGM Resorts International among its other members.

Each operator is required to align their activities with the 12 principles set out by the RGC, with their actions to be reviewed externally by a panel of experts who will provide guidance for future initiatives.

Read the full story on iGB North America.