The troubles at FIFA have shocked the sporting world and shone a powerful media spotlight on the universe of sports racketeering. The U.S. Department of Justice has called FIFA ‘The Enterprise’, as if it were an organised crime syndicate. It also issued 47 indictments against 25 conspirators. Under pressure from U.S. authorities, Swiss officials raided FIFA’s Zurich offices and started their own investigations.
The Americans pounced because many of FIFA’s alleged crooked deals involve major international marketing contracts with U.S. companies. But why are the Americans going after FIFA? The U.S. action has led to investigations of soccer corruption in Trinidad, Brazil and other countries.
The administration of sport is often overseen by ex-athletes with little prior experience in management [...].
As the U.S. Justice Department pointed out, according to FIFA, 70% of its $5.7 billion in total revenues between 2011 and 2014 was attributable to the sale of TV and marketing rights to the 2014 World Cup. Indeed, the scale of cash in major sporting events has now reached vast proportions, from the estimated $50 billion spent by the Russians on the Sochi 2014 Olympic Winter Games to the countless billions that Brazil will spend on this year’s Summer Olympics.
In addition to the arrogance of their leaders, many international sporting associations — despite the vast revenues they receive from business deals — enjoy not-for-profit legal status without mandated public reporting requirements. In many cases, they are also headquartered in countries that do not have a governmental tradition of looking at the ethics of such organisations.
A further critical obstacle to reform concerns the types of people who run major sporting associations. The new TI report’s editor, Gareth Sweeney, notes: ‘The administration of sport is often overseen by ex-athletes with little prior experience in management, operating through very linear hierarchical organisational models. While these models may have worked in the past, many international sports organisations (ISOs), regional confederations and national sports organisations (NSOs) have simply not kept pace with the huge commercial growth of the sector, and have even chosen not to adapt in order to protect certain self-interests, including high salaries, bonuses and virtually limitless tenures.’
[...] many international sporting associations — despite the vast revenues they receive from business deals — enjoy not-for-profit legal status without mandated public reporting requirements.
To make things worse, fans who support various sports with their money have no power. They may detest the match-fixing and riots in the streets, as they have done in some Asian countries over cricket corruption, however they show no signs of abandoning their favoured sports as a substantial protest. That fact is cynically exploited by the ‘managers’ of international sports.