China sponsors punish Australian Open for Peng Shuai stance

Tennis Australia could be set for a whole new world of pain, both to its finances and to its reputation, after the handling of a controversial protest.

While Australian Open organisers backpedalled on a decision to ban spectators from wearing T-shirts emblazoned with the words, “Where is Peng Shuai?” Tennis Australia (TA) could now face a backlash from Chinese sponsors, costing them millions in support.

Video emerged on the weekend of security and police requesting a fan at Melbourne Park to remove their shirt highlighting the plight of the Chinese tennis star.

Peng, a former Wimbledon and French Open doubles champion, sparked worldwide fears when she “disappeared” after making allegations of sexual abuse against a former top-ranking member of the Chinese Communist Party.

Two spectators wearing ‘Where is Peng Shuai?’ T-shirts are pictured in the stands on day nine of the Australian Open. Picture: Paul Croc/AFP

But the fallout from TA’s handling of the situation isn’t over.

Sports industry analyst and author of Sporting Superpower, Mark Dreyer, who is based in Beijing, warned it is impossible for Chinese brands and broadcasters to separate politics and business from sport.

“These things are seen as just incredibly sensitive and non-negotiable from a Chinese perspective,” he told the Australian Financial Review.

“We’ve seen in the past that sponsors will just pull out en masse if there’s something they don’t like.”

In 2018, TA inked a five-year deal with Chinese distillery Luzhou Laojiao, which would include prominent signage on the Rod Laver and Margaret Court arenas.

Then-chief revenue officer Richard Heaselgrave described it as “one of the largest deals that Tennis Australia has ever negotiated”, hinting that it was worth the same as a five-year sponsorship with car marker Kia, which was rumoured to top $85 million.

There has been global concern over Chinese tennis star Peng Shuai after she seemed to disappear following an allegation of sexual abuse against a former top-ranking CCP member. Picture: Mal Fairclough/AFP

Back in 2018, TA chief executive Craig Tiley added it was “far and away the most significant deal we have ever done in China”.

“Indeed, it is one of the biggest partnership deals we have done. It helps us push very strongly into the next phase of our global business growth,” he said, as the organisation hopes to cement the grand slam as one for the Asia-Pacific region.

But the issue with Peng has made balancing the relationship with China against reputational issues a tricky one for TA, according to Mr Dreyer, with the financial gains potentially not worth the risk to the organisation’s public perception.

“If you take the money, then you’re seen … as pandering towards the Chinese government line, and that in turn creates a huge backlash overseas, as you’re alienating your original audience and fans,” he said.

Australian human rights campaigners Drew Pavlou and Max Mok at the tournament in Melbourne. Picture: Paul Crock/AFP

He added that organisations are having to make a choice between China and the rest of the world.

“And as big as the China market is, and as much as everyone wants to be connected to the China market, it’s still not bigger than the rest of the world combined,” he said.

Chinese brands also have form with pulling out of sponsorship if they are not happy, a situation that happened in the US basketball league’s NBA, after someone from the Houston Rockets tweeted an image that read “Fight for Freedom. Stand with Hong Kong” in 2019.

While the tweet was deleted and an apology given, the Chinese broadcaster CCTV, which currently partners with Tennis Australia, responded by stopping showing NBA games.

Back in November, the UK urged China to provide ‘verifiable evidence’ about the ‘safety and whereabouts’ of tennis star Peng Shuai. Picture: Paul Crock/AFP

Meanwhile Chinese sponsors, such as smartphone maker Vivo and the coffee chain Luckin Coffee also pulled out costing the NBA millions.

“That was 2019 and the NBA is still trying to recover its business,” Mr Dreyer said.

“The commercial repercussions, aside from anything else, are significant, they’re often immediate, and they’re long lasting.

“The parallels (with the Australian Open) are very clear.”