Elsevier

Policy and Society

Volume 27, Issue 1, September 2008, Pages 55-68
Policy and Society

Gambling and corporate social responsibility (CSR): Re-defining industry and state roles on duty of care, host responsibility and risk management

https://doi.org/10.1016/j.polsoc.2008.07.005Get rights and content

Abstract

During the 1990s, states embraced legalised gambling as a means of supplementing state revenue. But gaming machines (EGMs, pokies, VLTs, Slots) have become increasingly controversial in countries such as Australia, Canada and New Zealand, which experienced unprecedented roll-out of gaming machines in casino and community settings; alongside revenue windfalls for both governments and the gambling industry. Governments have recognised that gambling results in a range of social and economic harms and, similar to tobacco and alcohol, have introduced public policies predicated on harm minimisation. Yet despite these, gaming losses have continued to climb in most jurisdictions, along with concerns about gambling-related harms. The first part of this article discusses an emerging debate in Ontario Canada, that draws parallels between host responsibility in alcohol and gambling venues. In Canada, where government owns and operates the gaming industry, this debate prompts important questions on the role of the state, duty of care and regulation ‘in the public interest’ and on CSR, host responsibility and consumer protection. This prompts the question: Do governments owe a duty of care to gamblers?

The article then discusses three domains of accumulating research evidence to inform questions raised in the Ontario debate: evidence that visible behavioural indicators can be used with high confidence to identify problem gamblers on-site in venues as they gamble; new systems using player tracking and loyalty data that can provide management with high precision identification of problem gamblers and associated risk (for protective interventions); and research on technological design features of new generation gaming products in interaction with players, that shows how EGM machines can be the site for monitoring/protecting players. We then canvass some leading international jurisdictions on gambling policy CSR and consumer protection.

In light of this new research, we ask whether the risk of legal liability poses a tipping point for more interventionist public policy responses by both the state and industry. This includes a proactive role for the state in re-regulating the gambling industry/products; instituting new forms of gaming machine product control/protection; and reinforcing corporate social responsibility (CSR) and host responsibility obligations on gambling providers – beyond self-regulatory codes. We argue the ground is shifting, there is new evidence to inform public policy and government regulation and there are new pressures on gambling providers and regulators to avail themselves of the new technology – or risk litigation.

Section snippets

Is gambling harmful?

The harms associated with EGM gambling put it along side tobacco and alcohol in terms of the need for special laws and regulations, a focus on potentially harmful effects of product consumption, licensing, and specific host training aimed at preventing harms; which under certain conditions of provision and use, result in detrimental economic, social and other impacts on users, their families and communities (Harrison, 2007, SACES, 2005). Some of the externalities of gambling (those often

The Ontario host responsibility duty of care debate and corporate social responsibility of gambling industry

In 2006 the Ontario Problem Gambling Research Centre released a report “Do Ontario and Its Gaming Venues Owe a Duty of Care to Problem Gamblers?” authored by William Sasso and Jasminka Kalajdzic, attorneys at Sutts, Strosberg LLP in Windsor Ontario (Sasso & Kalajdzic, 2006). Their revised version is mainly drawn on below (Sasso & Kalajdzic, 2007). This report (referred to as the Sasso and Kalajdzic report) examined a number of questions related to government/industry duty of care:

  • Whether the

Research on identifying problem gamblers on-site in venues

A controversial but important area for the gaming industry has been the issue of venue staff interventions when players manifest signs of distress or patterns of play associated with problem gambling. Doubts about staff interventions have been expressed regarding player privacy, the evidence base for associating certain behaviours with problem gambling and the accuracy/subjectivity of staff judgements. In the Ontario debate, Cameron argued that such interventions were problematic as industry

Using loyalty player tracking CMS data systems to provide management with high confidence identification of problem gamblers using new software to track and analyse player behaviour

Cameron makes a number of assertions regarding venue's capacity to identify problem gamblers and take steps to stop them gambling. She argues:

it would be difficult to establish proximity between problem gamblers and their hosts under the Childs criteria: the gaming industry does not and cannot control the risk of problem gambling; it cannot monitor the activities of problem gamblers because it cannot identify who they are; and it cannot prevent them from seeking and gaining access to other

Research on harm/protection dimensions of EGM machines

In some jurisdictions such as Australia, New Zealand and some provinces in Canada, gaming has reached the plateau characteristic of mature markets that are bounded by combinations of market saturation, regulatory limits to growth and government recognition of public concerns about harms. Where there are limits to the number of machines in a venue, or in a region, state or province; machine innovations target better return-on-investment (ROI) through quicker or more efficient throughput. From a

Globalisation and gambling harms –the international evidence

The research evidence cited above has implications internationally. It is not as if different jurisdictions have developed ideosyncratic products. Global suppliers of common-platform gaming products (VLTs, EGMs and slots) sell to multiple sites across the world. Transnational gaming corporations are expanding their casino networks and a diverse range of gambling products are percolating into different countries, drawing on a global gaming supply chain. State, regional or national jurisdictions

Conclusion

It is acknowledged that the harms associated with gambling impact wider than the individual and are manifested in impacts on families, workplaces, communities and in terms of broader issues related to wide-ranging economic, social and cultural impact; not all positive. Ten to 15 years after EGMs, VLTs Pokies, or Slots products were introduced for the first time into clubs, hotels and pubs in communities and into casinos, in a range of sites globally, researchers are now coming up with

Acknowledgements

The authors are grateful for the feedback provided by anonymous referees. Linda Hancock would like to thank the Dalhousie University Faculty of Management for its hospitality during a recent sabbatical visit.

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