Study finds gaming operators lack transparency in community contributions

A recent study sponsored by the Macau Foundation, conducted by the Asia Pacific Association for Gambling Studies (APAGS), has shed light on the information disclosure practices of Macau’s major gaming operators over the past decade.

The study, which evaluated the Corporate Social Responsibility (CSR) practices of these operators from 2012 to 2021, highlighted several critical areas where transparency was lacking, raising concerns about gaming operators’ contributions to the local community.

The study, led by Zeng Zhonglu from the Center for Gaming and Tourism Studies at Macao Polytechnic University, used data primarily sourced from the Macau SAR Government’s annual policy reports, annual reports, and Environmental, Social, and Governance (ESG) disclosures of the six gaming companies, along with their websites and financial results.

One of the key findings of the study was the limited transparency in information disclosure practices by Macau’s gaming operators. Specifically, the study identified gaps in disclosing sensitive information related to the employment of local workers, the proportion of local workers in management positions, and the amount of procurement from local small and medium enterprises (SMEs). These areas are crucial as they represent the tangible contributions of the SAR government and Macau society to the gaming companies.

“Without specific data, it is challenging to make accurate assessments,” commented Zeng Zhonglu, as cited in media reports.

The study’s data was collected before the new gaming law came into effect on Jan. 1, 2023, which imposes more rigorous requirements for measurement. However, the research team believes that the study provides a systematic case for quantifying the fulfillment of social responsibilities by gaming companies.

Another significant aspect highlighted in the study is the lack of responsiveness by gaming operators to stakeholder expectations, particularly those of the government. Zeng Jia, a co-author of the study, stated, “our analysis reveals a pattern where gaming operators often delay or provide inadequate responses to stakeholder expectations, particularly in areas critical to social responsibility and community engagement.” The study segmented the government’s requirements, including economic diversification, support for SMEs, responsible gaming practices, and the promotion of local workers, with the latter showing the weakest response from the six gaming companies.

Despite the transparency deficiencies and lack of proactive responsiveness, the gaming operators have made substantial contributions to Macau’s economy. Sands China Ltd emerged as the largest taxpayer among the gaming operators, contributing approximately MOP218.3 billion (USD27.3 billion) over the past decade. This financial support plays a critical role in bolstering Macau’s government finances during economic challenges. Following Sands China, Galaxy Entertainment Group contributed MOP195.4 billion (USD24.4 billion), and SJM contributed MOP190.9 billion (USD23.9 billion). Melco Resorts & Entertainment, Wynn Macau, and MGM China also made significant contributions.

In terms of employment, the study revealed that the six gaming operators collectively employed 80,808 local residents in 2019, accounting for 28.7% of Macau’s local workforce. SJM employed the highest proportion of local employees (24.1%), followed by Sands (23.1%) and Galaxy (18.8%). Despite the challenges posed by the pandemic, the number of local employees slightly decreased to 76,265 in 2021, still representing 27.2% of Macau’s total employment.

While the study focused on the period preceding the operators’ latest 10-year concessions, awarded in 2022, which require a more hands-on role in Macau’s economy and residents’ day-to-day lives, the research team believes their findings provide a strong case for quantifying the fulfillment of social responsibilities by gaming companies. Victoria Chan