UKGC’s Tim Miller: social responsibility goes beyond “what your regulator tells you or what the law requires”

UK Gambling Commission executive director Tim Miller’s keynote on responsible gambling to the International Association of Gaming Advisors (IAGA) Summit this week followed hard on the heels of recent and highly publicised actions by the regulator against 888 and BGO.

So, it was hardly surprising that he took this opportunity to lay out what the UKGC expects of operators in a time when all evidence points to the fact that “the contract between the gambling industry and society is under pressure and rapidly needs attention”, according to Miller. This important keynote can be read in full below.

“Government by consent….policing by consent….gambling by consent?

The first two are probably more familiar concepts than the last. The idea that in a democracy a government only has legitimacy through the consent of the governed. That the police are there to serve and protect the public, rather than the state, and whose authority exists through public trust and acceptance.

But the concept of gambling by consent? Perhaps not a concept that has been given quite as much thought. The idea that there is some sort of agreement between society and the gambling industry that sets the ground rules for what gambling’s rightful place is within that society.

In Britain, the 2005 Gambling Act was, in effect, a contract between the gambling industry and the British public. One side of the bargain was the offer of one of the most liberal gambling markets in the world.

Where the industry would have greater freedom to innovate in the products they can offer; to operate in a flexible business environment; and to generate profit for their directors and shareholders.

And this wasn’t a one sided bargain. In return society expected gambling operators to take their social responsibilities seriously. These were primarily set out in the licensing objectives, ensuring gambling is fair and open; that it is crime free; and to protect vulnerable people from harm.

But as with many other legal agreements, the ‘clauses’ in that social contract were not just based upon strict legislative or regulatory requirements. Society included additional terms, terms that cover corporate behaviour, social responsibility, consideration of the public interest. Importantly, this contract contained a lawyer’s biggest nightmare… terms that are unwritten, implied and subjective.

Perhaps most challenging of all – the route for seeking redress if that social contract were to be breached would not be to a court of law but to the court of public opinion. Disputes would not be adjudicated on by a judge but would be determined by pressure groups, politicians and the media.

The idea of a social contract is not unique to the gambling industry. It exists for every area of business and commerce. There have long been unwritten rules about how businesses perform their role in society. And when society starts to feel that business is not playing by the rules we have typically seen regulatory intervention.

The establishment of the UK’s Food Standards Agency following the outbreak of ‘mad cow disease’ in the 1990s; the Dodd-Frank reforms in the United States following the financial crisis of 2007; or more recently, a new oversight regime in France in response to hundreds of deaths linked to weight loss drugs. All of these are examples of an expected regulatory response to fix a broken relationship between business and consumers.

But something new and different is happening. Across Western democracies we are seeing example after example of social contracts between business and society starting to break down. And instead of regulation being the natural response of choice, we are witnessing more direct action by society itself.

It can start small and localised- consumer boycotts of companies that are thought not to be paying their fair share of tax. It can then quickly begin to snowball into more wide spread action and demonstrations- the Occupy Wall Street movement in response to the behaviours and influence of the financial services industry. Finally, it can lead to an avalanche of discord and violence – as seen in anti-capitalism and anti-globalisation protests across the world.

Whilst gambling hasn’t yet been subject to the more extreme end of consumer action, there is growing evidence that public attitudes are starting to shift towards that direction. In just the past few weeks we have seen a call from Arsene Wenger, the manager of a high profile Premier League soccer team, for gambling to be banned altogether.

Think about it – a leading and influential voice, from a sport with deep links to gambling, suggesting that gambling may no longer have a place in society.

More widely, in 2008 the British people were asked whether they thought gambling was fair and could be trusted. Almost half the population agreed that it was, with 60% of gamblers taking that positive view. Fast forward to 2016 and only 34% of people agreed. Strikingly, over that period of time we saw the proportion of gamblers who felt gambling was fair and trusted plummet by a staggering 23%.

Dig into those figures in more detail and we see some very telling numbers. A growing number think that people should have the right to gamble whenever they want. Yet at the same time an increasing proportion of people thought there were too many opportunities to gamble and that gambling should be discouraged. Put simply there is still public support for the existence of gambling as a leisure activity but growing concern about the way it is being offered.

What clearer evidence could anyone need to argue that that the contract between the gambling industry and society is under pressure and rapidly needs some attention?

With this discussion of social contracts you could be forgiven for thinking that you were on the other side of Columbus Circle and had actually stumbled into Sociology 101 over at Fordham University. But understanding the broader social context that we all operate in is important.

Viewing responsible gambling through the lens of the wider relationship between business and society brings a different perspective on why it is so important for the industry to take their responsibilities seriously. To move away from the idea that the social responsibility agenda is driven solely by regard to what your regulator tells you or what the law requires and to focus more on what your customers, your communities, your society expects of you.

And that change of thinking brings a whole new sense of urgency for industry to fully deliver on its social responsibilities. Because when you don’t meet the requirements of law and regulation- then your businesses risk enforcement action and penalties. However, when you don’t meet the expectations that society places upon you then your entire industry risks its very future.

And society is expecting more and more from businesses. In your own organisations this sea-change in consumer behaviour may not have presented itself yet. But be under no illusions, it is coming. There is no industry, no commercial sector that will be able to escape the tide of consumer expectation. Society wants to change the terms of its contract with the gambling industry. The question is ‘Are you ready’?

To help in answering that question I want to focus upon three areas, which given the right attention and genuine commitment, could make for a more sustainable relationship between gambling and society

1. A relationship that is well balanced
The first is to build a relationship that is well balanced, where obligations and responsibilities are shared fairly and appropriately, although not necessarily equally.

A responsible approach to gambling is a partnership, a partnership between both gambler and operator. But my challenge to you today is whether that partnership is being shared fairly? Is there too much expectation on the gambler to be responsible and not enough on the industry?

Is there too much focus on providing tools for consumers to manage their use of gambling products and not enough on ensuring that gambling products are sufficiently safe in the first place? Are we thinking too much about ‘responsible gamblers’ and not enough about ‘responsible gambling’?

In Britain, when we talk about actions to address gambling related harm our attention is often drawn to self-exclusion schemes. Self-exclusion is widely accepted as an important harm-minimisation tool for people who have recognised that that they have a problem with gambling.

We are seeing some very positive developments in this space. From April of last year all land based operators were required to take part in multi-operator schemes for their sector. This allows an individual to self-exclude from multiple operators with just one request.

The remote gambling sector are developing a similar scheme which is planned for roll out later this year. Importantly, awareness of self-exclusion is increasing, with 43% of gamblers either having used or knowing how to use this tool.

Now, I wouldn’t want what I say next to be seen as being unsupportive of these efforts. Indeed, I am an enthusiastic advocate of self-exclusion. It provides consumers, who are struggling to control their gambling, with a valuable tool. But the onus still remains on the gambler to accept that they have a problem and to take positive steps to act to protect themselves. It focuses upon helping the gambler to be responsible but does little to make the gambling product itself safer.

Yes, personal responsibility is important – it should be supported and encouraged through methods that empower consumers to take greater control of their gambling. But to place all the expectation on gamblers to be responsible risks overlooking industry’s own responsibility to focus on safer gambling.

Just look at other industries. We expect people to use medications responsibly by following the directions on the bottle- but we also expect and regulate to require that pharmaceutical companies bring new drugs to market that are sufficiently safe for use. And over time society expects companies to use research to develop increasingly safe and effective medicines.

We expect people to drive cars in a responsible way by following the rules of the road- but we also expect and regulate for motor manufacturers to develop new vehicles that meet required safety standards. And over time society expects manufacturers to exploit new technologies to make ever safer vehicles.
A social contract sees both parties having responsibilities.

The consumer to use products responsibly and industry to develop products that are sufficiently safe to use and that, over time, become safer still. But the expectations from society are usually that industry does the heavy lifting and leads the way.

And the expectations from society will undoubtedly be no different for gambling. Yes, there is broad acceptance that people should gamble responsibly and not spend more time and money than they can afford. But equally society will demand that the gambling industry takes the same innovative approaches, creativity and technology that leads to engaging products and turns those skills and resources to also deliver a consumer offer that is increasingly safe to enjoy.

2. A relationship that has real impact
The second area that could lead to a stronger relationship between society and gambling is more clearly and effectively demonstrating when and how social obligations are being met. With any ‘contractual’ relationship both parties need a mechanism for establishing that the terms have been met. This relationship, between gambling and society, is no different.

One of the criticisms that I hear of the industry’s approach to social responsibility is that businesses are too focused on doing things and not focused enough on doing things that work. That operators are too eager to put a tick against an item in a business plan but can’t so easily demonstrate the impact that those actions have.

The consequence, if this view becomes widespread, is that people will think that the gambling industry is only paying lip service to their responsibilities. That they care more about trying to keep the regulator off their back than they do about actually meeting their obligations to society.

I'm not convinced that this is a fair way to characterise the whole industry. Certainly in my time at the Gambling Commission I have met many people in gambling businesses, at all levels and in different roles, who clearly care passionately about doing what’s right for their consumers and for their communities. People who, yes, want to create products that are engaging and profitable but who also want to do this in a way that is safe, responsible and ethical.

However, finding examples of social responsibility measures whose impact has been properly assessed is difficult. That’s not to say that existing actions have been unsuccessful in making gambling safer. It is simply a recognition that the evidence either way is limited.

Again, in the area of self-exclusion there will be a need to carry out proper evaluation of the impact and effectiveness of such schemes. This has started to happen in a limited way with an independent evaluation of the betting scheme showing that 83% of people agreed that it had been effective in reducing or stopping their gambling.

But more needs to be done on evaluation. Whilst we are firmly of the view that this responsibility lies with the industry, as the regulator we also have a role in supporting this and will be developing some high level principles that industry can use when commissioning their own evaluations.

The need for clear frameworks for measuring and demonstrating the impact of harm minimisation activity cannot be overstated. Without such frameworks the public simply will not trust that you have a genuine commitment to safer, more responsible gambling. And without trust gambling’s place is society continues to weaken.

Much of what I have said so far perhaps paints quite a gloomy picture about gambling’s future place in society. The risks are real; attitudes are shifting. However, this also presents a genuinely exciting opportunity. An opportunity not just for the organisations that we work for but an opportunity for each and every person sat in this room today.

3. A relationship built on understanding
Which brings me to my third and final point. Building better understanding between industry, consumers and wider society is the key to establishing a new social contract that is mutually beneficial; jointly agreed and reasonably long-lasting. A relationship that all parties feel a sense of ownership over and in which they feel they have a voice. A relationship where concerns about the safety and risks of gambling are acknowledged, respected and acted upon.

Quite simply this means speaking and listening to each other. Not lobbying the politicians, not placating the concerned, not distracting the critical but direct, open and genuine engagement:

• with your customers
• with problem gamblers
• with treatment and healthcare providers
• with community and faith groups
• with charities.

To truly understand the views, needs and frustrations of society don’t turn your focus to the regulator. Turn your sights to your consumers- ask them what they think about the service they receive; listen to the complaints they make; act upon the feedback they provide.

And turn your attention to your communities- understand the impact that gambling can sometimes have; hear what their perceptions are of your companies and your products; reflect upon their criticisms and misgivings about gambling.

Within your organisations think how you can best hear the voices of your customers and your communities. At the Gambling Commission our statutory licensing objectives have long embedded the interests of consumers at the very centre of what we do. Our increasing focus on putting the consumer at the heart of regulation also means we have to do more to make sure that people are heard.

We are spending more time working with community and advice groups. We are ensuring that our Board meets with people who have a wide range of views and experiences of gambling. We are taking steps to make it easier for both us and businesses to hear the consumer voice through more effective and accessible industry complaints processes.

These are some of the things we are doing- we hope and expect businesses regulated by us to also pick up the challenge of listening to what consumers and the wider public have to say.

And whatever your role – whether you work for a regulator; a gambling operator; a treatment provider- whatever your position in your organisation, we can all, as individuals, be a part of that conversation.

Because ultimately, creating an environment where gambling is clearly seen to be fairer and safer is something that we should all take an interest in. In the end this should be personal – gambling related harm can affect us all.

Whether it’s us or someone we know that develops a gambling problem; whether we face higher taxes to meet the societal costs of problem gambling; whether our local healthcare systems struggle to respond to the public health effects of gambling. The consequences from gambling related harm has an impact on everyone.

So don’t wait for your own organisations to act. Each and every one of us in this room can do something today to build a better relationship between gambling and society. Talk to your family; talk to your friends; talk to your neighbours. Because when it comes to creating safer, more responsible gambling we all have a stake; we all have a voice; we all have our part to play.

There is a famous, perhaps apocryphal, story that really brings this point home. In 1962 President Kennedy was visiting the NASA Space Centre. During the visit he noticed a janitor sweeping the floor. He interrupted his tour, walked over to the man and said,

'Hi, I’m Jack Kennedy. What is your role here?'

'Well, Mr President, I’m helping to put a man on the moon,' the janitor responded.

When I get home from work my daughter always asks me what I did today. My answer is often a version of 'A lot of meetings', 'A lot of reading', or 'A lot of writing'. I suspect for many of you it’s a similar response. But wouldn’t it be great for us to say something more positive, more satisfying, more inspiring?

What I am saying today is that we can do just that. By all playing our own individual part in supporting this industry to meet its obligations to society we have that opportunity to go home at the end of the day and with real conviction and passion say…

'Today, I helped to make gambling safer.'”

Related articles: 888's UK licence faces Gambling Commission review
UKGC issues £300K advertising fine to BGO
UKGC issues warning over video game gambling
UKGC terminates Run Lines’ gaming licence
Regtech and problem gambling: putting tech to work responsibly (paywall)
UK regulatory waters will require careful navigation in 2017 (paywall)