FCPAméricas Blog
Corruption and Football, and Reforming FIFA
2.09.2013
No region in the world might have more passion for football (soccer) than Latin America. And where there is passion, there is money. And where there is money, there is corruption.
One example of corruption in football might be FIFA, the International Federation of Association Football. It is the federation of 209 national football organizations. It oversees the World Cup. For years now, the organization has been plagued by accusations of greed, corruption, and abuse.
How can problems arise in such an organization? Consider FIFA’s marketing power. Football is the most popular sport in the world with an estimated fan base of more than 3.5 billion fans. As a result, FIFA’s marketing contracts are high dollar. This creates the opportunity for FIFA to award them based on kickbacks.
Countries might also seek to buy votes during the World Cup hosting decision process. In addition, those in leadership roles might buy votes to stay in control. Tickets to the best events could be distributed in return for favors.
The media is not the only one highlighting FIFA’s problems. Corporate partners, like Coca-Cola, Adidas, and Visa, have complained about the negative press and what it does to the game itself. Even Argentina’s Diego Maradona has offered his two cents: “FIFA is a big museum. They are dinosaurs who do not want to relinquish power. It’s always going to be the same.”
How can FIFA minimize the risks of such abuse? With a good internal governance structure. Wrongdoing is much harder to accomplish when controls are in place.
The good news is that, in 2011, during a flurry of adverse press, FIFA’s Executive Committee established a governance reform project, asking leading anti-corruption expert Mark Pieth to build an Independent Governance Committee (IGC) made up of compliance experts throughout the global. After a thorough review, the IGC made sweeping recommendations for reform.
Some of the recommendations, such as the establishment of an Ethics Committee and an Audit & Compliance Committee with an independent chair, and an updated Code of Ethics, were approved at FIFA’s 2012 Congress. But others remain. For example, the IGC recommends that: all members of the Executive Committee and Standing Committees be subject to integrity reviews in a centralized way; the Chair of the Audit & Compliance Committee participate at all committee meetings, including the Executive Committee; Executive Committee terms of office be limited; the bidding and decision processes for hosting decisions and marketing and procurement activities be redesigned; and, compensation and benefits be transparent.
The bad news is that convincing the FIFA Congress to adopt the remaining reforms will take leadership from the Executive Committee, and the Committee no longer seems very interested. In a report issued this week, the IGC complains of being sidelined. Rather than take on the proposed reforms directly, the Executive Committee has referred them to an ad-hoc group made up of heads of the regional groups. One IGC panel member stated: “I am just stunned by the pushback we are getting for issues that should be no-brainers.” When the Executive Committee should be vocalizing its support and endorsement, it seems to be stonewalling.
The FIFA Congress meets next in May 2013. That offers little time to generate the support needed to adopt these serious governance reforms. It would certainly be a shame if the most important sport in the world looses its chance to clean up.
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© 2013 Matteson Ellis Law, PLLC
Post authored by Matteson Ellis, FCPAméricas Founder & Editor
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