Interview with Stan McCoy

April 25, 2024
Stan McCoy, President and Managing Director, EMEA Motion Picture Association. Stan McCoy, President and Managing Director, EMEA Motion Picture Association.

Unleashing the Potential of the Creative Industries

Creative industries are gaining increasing recognition by policymakers and the private sector as a driver of growth and a source of employment. According to UNESCO (2021),  creative industries generate roughly $4.2 billion in revenue, with an estimated multiplier effect of 2.5x through direct and induced impacts. However, it is widely recognized that the sector has not yet reached its full potential in many developing nations. To support creative industries sector development, IFC is mobilizing financing for the private sector and advisory and policy dialogue with governments. 

During the 2023 Annual Meetings, IFC hosted an engaging panel discussion titled  “Unleashing the Potential of the Creative Industries”. Following the live event, Stan McCoy, President and Managing Director, EMEA Motion Picture Association, spoke with IFC to provide additional insight and continue building the pool of knowledge within the space.    

At the Annual Meetings discussion, you mentioned that the film production business is about managing intrinsic and extrinsic risks. You also said that smart public policy is an important part of managing extrinsic risks, like regulations. What risks arising from regulations do you often see?

Four key risks come to mind.

The first is disproportionate or arbitrary regulation. Simply put, complicated and arbitrary regulation can make it impractical to do business. As an example, you could ask yourself how easily a film producer can get permission to close a street to shoot a car chase. Is the process simple and transparent? Some other examples include dictating how businesses invest, over-regulating business contracts between different players, or a general lack of stability and predictability in how laws and regulations are administered. 

The second risk is inadequate incentives for investment. The film, TV, and streaming industry is a global powerhouse of around €540 billion. A key takeaway for policymakers should be that this industry can generate jobs and economic vibrancy, if we just give it the right incentives.

A third risk is weak regulation regarding piracy. Allowing illegal services to go unchecked can really destroy the market for lawful distribution.

Skills availability within the workforce also comes to mind as a risk. A film producer supervises their own workforce, but producers do not control extrinsic government policy factors, such as education and training, which determine whether there will be a well-trained pool of local carpenters, electricians, hairdressers, caterers, truck drivers, and all the other trades and professions that are essential to making film and television. These professions often need to be contracted locally and are essential to production. 

To address the risks mentioned above, what types of public policies have you come across? 

I’m a fan of what I like to call “boring” public policies. 

For example, film and television is a business of intangible assets, so it needs a stable copyright system to protect those assets. Multilateral treaties need to be transposed into national law, and courts need to interpret and apply copyright law in a predictable way. 

Fiscal incentives similarly need to function in reality just the way they exist on paper. At the end of the day, the advertised numbers often matter less than creating investor confidence that the system really works.

Finally, when pirates steal intellectual property, rights holders need to be able to rely on law enforcement, courts, and government agencies to uphold the rule of law. This might take shape, for example, as transparent due process for the blocking of pirate sites. 

These policies may sound mundane, but the path to vibrant creative sector businesses is paved with straightforward, no-drama policy choices.

What role do you think fiscal incentives play in attracting projects to new filming locations? What types of incentives make a location particularly attractive?

Production incentives play an important role in the global production industry. They can provide producers with the cornerstone of a finance plan and play a decisive role in where productions are sited. 

Most film and television projects go through a process we call “greenlighting” to assess their potential.  Choice of location and production costs are an important part of that process. To influence the process, governments increasingly consider production incentives as an efficient and strategic tool to attract high-value inward investment. For example, a recent study showed that when HBO shot the second season of The White Lotus in Sicily, that single production alone contributed €38 million to Italy’s economy and created 1,500 local jobs. 

As to what kind of incentives work best, the short answer is the stable kind. Of course, large producers particularly like to see a high percentage and a broad scope of spending counting toward the incentive, with any incentive caps set at a high level, relative to other jurisdictions. I have seen that shortcomings on these issues often get addressed and incrementally improved over time. But, first and foremost, it is key that incentives operate as reliably as clockwork.

Do intellectual property rights, censorship, and content freedom also play a role in decision making? 

Yes! Freedom of expression and media freedom are one of the foundations of our industry. Another critical foundation is strong and stable copyright protection. Without copyright, even the most robust storytelling culture will fail to foster a thriving creative industry. Copyright and intellectual property laws have guided and protected the world’s creators and artists, allowing them and their business partners to seek just compensation for their hard work and creativity, and stimulating innovation. 

Concerning censorship, we have had a great experience with industry self-regulation in the United States, where MPA operates the movie rating system, which does not censor, but empowers parents with information to make wise choices. Beyond that, three key considerations for any system are transparency, predictability, and the imperative to respect fundamental human rights.

How do you view the opportunities and challenges for growing the creative sector in developing countries?

The opportunities are tremendous. The reservoir of creativity and innovation is deep, and the entrepreneurial spirit is strong, as we saw so vividly during the discussions on Unleashing the Potential of the Creative Industries. 

At the same time, there are challenges. The biggest single challenge is piracy, which too often dominates the market in developing countries, creating a massive disincentive to bring legal offerings to those markets. Nonetheless, the legal offer is growing, and it will grow faster still if it can be complemented with a combination of antipiracy actions. Going after commercial-scale pirates and education campaigns will encourage consumers to get their film and television from legitimate sources. There is a video with famous Burkinabe actor Issaka Sawadogo that I really like and that acts as an example of the latter.