Here at the Alliance governance team, we’re always on the lookout for real-life examples of sports governance (both good and bad) to back up the principles espoused in the Voluntary Code of Good Governance. Whilst finding these examples isn’t exactly the most difficult job in the world, we can’t help but think that when it comes to exemplifying the consequences of poor governance, FIFA sometimes just make it too easy.
The Telegraph recently revealed that FIFA have lost another three major corporate partners, after Castrol, Continental and Johnson & Johnson all confirmed their respective sponsorship agreements were not renewed after expiring last year. These organisations join Sony and Emirates on the list of major sponsors to have abandoned FIFA since the end of last summer’s World Cup in Brazil.
Whilst the most recent three avoided public statements giving reason for their decisions, any objective observer would struggle not to connect their departure with the fiasco surrounding allegations of bribery and corruption during the 2018 and 2022 Men’s World Cup bidding process, and the handling of FIFA’s enquiry into said allegations.
This fiasco has only arisen due to a perceived lack of transparency and accountability within the senior governance of football’s global body. For a sporting organisation in the public eye, it is important not only to act with integrity, but to be seen to do so. Without the necessary transparency in their decisions, and a level of accountability which allows stakeholders to question those choices, any organisation risks becoming victim to allegations of impropriety, cronyism and conflict of interest.
Whilst the financial risks associated with this sort of behaviour in the majority of organisations will not match that of FIFA (the fleeing sponsors mentioned above form a large part of a sponsorship portfolio worth £250 million per year) it is still important for an organisation of any size to bear the risks in mind.
Principle six of the Voluntary Code of Good Governance states that; “The Board needs to be open and accountable to its membership and participants, and its actions should stand up to scrutiny when reasonably questioned”.
Whilst a majority of sport and recreation governing bodies in the UK (unfortunately) won’t have multi-million pound sponsors to worry about, every organisation should worry about the reputational damage the organisation could face in the eyes of its members and participants. Without accountable and transparent leadership, participants question their ability to trust the organisation, their decision to continue paying affiliation fees, and ultimately, their decision to partake in the activity at all.
Accountability and transparency is an important foundational principle in creating a well-governed and well respected governing body. Without it, an organisation faces untold reputational damage and risks losing valuable sponsorship and even more, valuable participants. Sadly, there is currently no better exemplar for this risk than world football’s governing body.
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