The Effect of Sponsorship to Sports Industry on the Intangibility of Sponsoring Companies of the Eletric Power Sector in Brazil

Abstract

This paper discusses the effects of sports industry sponsorship on the intangibility of sponsoring companies. The importance of the sports industry, the opportunity to propagate sponsor’s brand, as well as the tax exemptions allowed by the Social Responsibility Law, has encouraged the companies to gradually sponsor the sector in the most recent years. However, there are few studies that discuss the effects of this investment on the sponsoring companies. This work examines some of these effects, analyzing the intangibility of Brazilian companies in the electric power sector from 2007 to 2013. The sample consisted of 21 companies that have their shares traded on Brazilian stock market and which have Ibase social balance sheets. The nature of this study is quantitative and data were collected with the Economática® database, Ibase social reports, and reports published yearly by the companies, such as administrative, social and sustainability reports. Multiple panel regression was used, evidencing that the sponsorship of the sport industry was positively related to the intangibility of sponsoring companies. The results are relevant as they contribute to fill up the theoretical gap in which the strategy of sport industry sponsoring explain and can leverage the degree of intangibility of companies.