Sunday, November 2, 2014

The Business of Sport and Foul Play

“But rules cannot substitute for character.”
Alan Greenspan (US Federal Reverse Chairman, retired

When we think about sport the words that immediately come to mind are sportsmanship, respect, fair play, integrity and clean competition. In fact, the various sports governing bodies have ethics that are meant to set the standards and uphold the integrity and reputation of the sport they are meant to champion and steward. And they have a code of conduct tied to their mission and intent. Here are a couple of lines from FIFA, NFL and the ICC, respectively: 

“FIFA is constantly striving to protect the image of football, and especially that of FIFA, from jeopardy or harm as a result of illegal, immoral or unethical methods and practices...” 

“All persons associated with the NFL are required to avoid "conduct detrimental to the integrity of and public confidence in the National Football League." 

“The overriding objectives of the Code are to enhance the reputation of the ICC, to foster public confidence in the ICC’s governance and administration of the sport of cricket worldwide and in particular to strengthen its authority to deal with corruption.”

All of their codes and rules sound rather impressive, and reading through any of them might leave one with the impression that these organisations hold themselves, their executives and players, to a high standard of excellence and integrity. These standards serve to enhance the reputation of their respective sports and set an example for the rest of us, most importantly for all the young impressionable minds that form the largest audience and fan base for them. I am referring to some the most iconic, powerful and recognisable sports governing bodies in the world from the International Olympic Committee (IOC) to Fédération Internationale de Football Association (FIFA); bodies that have been entrusted with furthering the growth and development of sport in a manner that is meant to always put the good of the sport and its athletes ahead of all other interests - personal, business or otherwise. Major sporting events often form the only common ground between sworn enemies, and also the glue that cuts across ethnic divisions within every nation. One cannot underestimate the importance of sport in our world. Where else would we see Iran take on the USA or a divided Afghanistan come together to root for their cricket team? In a world more divided and more divisive than ever before, sport has become the healthiest bond between societies, and a source of national pride and identity for legions of fans. This is the responsibility with which these men have been entrusted.

Not only are the men in charge of these governing bodies powerful in the world of sports, but also today many are counted among the most influential men in the world because of the nexus between business and sport. Sepp Blatter, the four consecutive terms President of FIFA, made #69 on the Forbes’ list of the most Powerful People for 2013. “Blatter is only the 8th President to have served in the more than 100 years of FIFA’s existence” (Source: Forbes). With all this influence and absolute power, it is no wonder that these organisations operate more like the mafia than a charity. For the recently concluded World Cup, FIFA demanded that the Brazilian government change a decade old law banning the sale of beer in stadiums because Budweiser was a major sponsor (Source: Latin Post). “Brazil spent an astounding $11 billion to host the FIFA tournament. FIFA officials have to be treated like royalty, and there have been accusations of bribery and other forms of corruption...and according to Brazil's Internal Revenue Service, FIFA is getting tax exemptions worth nearly $250 million dollars. Other estimates are even higher.” (Source: CNN). Also, there has been much media attention focused on how Qatar won the bid to host the 2022 World Cup. Qatar is a desert nation that has no football team much less a league to speak of, and temperatures that routinely cross 117 degrees Fahrenheit in the summer, when the event is scheduled. So far the fallout has been just one FIFA official, Jack Warner, resigning, and this only after the media released a tape of him encouraging FIFA officials to accept bribes ahead of the voting process for awarding the 2022 World Cup.

Something people may not be aware of is that all these sports organisations hold tax-exempt status. Yes you heard me right – these multi-billion dollar, for profit enterprises, have tax exempt status. The latest World Cup in Brazil generated more than $4 billion in revenue for FIFA. This is on top of declared cash reserve they have of $1.4 billion (source: Forbes Article). The IOC generated $5 billion in revenue between 2009 and 2012. The NFL generates close to $10 billion annually, the Professional Golf Association (PGA) tour nearly $1 billion (source: CNN article). The National Hockey League (NHL) reported record earnings of $3.7 billion this past season (source: CBS Sports Article). The Board of Control for Cricket in India (BCCI) recently joined the league of wealthiest sporting bodies in the world, with revenues of $1 billion for 2011-12 (source: Financial Express). All these sports organisations have been given tax exempt status, somewhat similar to charities, because they are considered private organisations whose primary purpose is to further the industry or profession they represent. They are similar to a local chamber of commerce or the hotel and restaurant industry associations. However, one fundamental difference is that many if these sports bodies have the right to represent countries on the international stage, and they also avail of tax payer funded facilities like stadiums and other public sporting infrastructure without paying for it. The BCCI in India has steadfastly refused to come under the purview of the Right to Information Act (RTI) on the grounds that it is a private body with charitable institution status.

Here in America, the NFL Commissioner Roger Goodell, who incidentally was paid a $44 million salary in 2012, was recently caught on the wrong side of a domestic abuse case involving one of the league’s star players. It seems Goodell may have lied about information that was previously disclosed to him, in order to cover-up the seriousness of the incident. It is possible he withheld evidence (the player got a two game suspension for knocking out his pregnant fiancé and then physically dragging her out of the lift unconscious) to protect the image of the league and the massive revenues brought in from its sponsors. Turns out that during Mr. Goodell’s seven year plus tenure there have been more than fifty reported incidents of domestic violence involving players and a total of six game suspensions handed out by him; hardly the zero tolerance policy one would expect to fit the serious nature of these crimes. Yet, Mr. Goodell has refused to step down over his clear mishandling of a very serious matter or for his less than stellar track record in dealing with this crime during his tenure (Source: NYTimes).

In India, the current ICC Chairman and BCCI President, Mr. N. Srinivasan has also been acting with complete impunity and with total disregard for the ethics he has sworn to uphold. He failed to act when an illegal match-fixing scandal engulfed the Indian Premier League. This despite the fact that his own son-in-law was indicted as one of the prime accused in the case, and it concerned a team that he owned. The fact that the head of a governing body can also be the owner of a team, in the league he governs, should be sufficient grounds to disqualify him from holding any post; it is a blatant and obvious conflict of interest. However instead of apologizing and doing the right thing, Mr. Srinivasan has dug in his heels and unabashedly challenged anyone to oust him.  It was not until India’s Supreme Court stepped in and severely reprimanded him that he was forced to step aside (albeit temporarily) as President of BCCI. The court called Mr. Srinivasan’s refusal to step down “nauseating.” Meanwhile, he has just been elected as Chairman of Cricket’s international governing body, the ICC.

These are just three examples from the sordid world of sports governing bodies and the cancer that seems to plague their leaders today. Corruption seems to be rife across the board with reports of bribery at the IOC, doping cover ups in both baseball and cycling, and even sex and drug fueled orgies to win contracts for Formula One racing. With the sheer amount of money being generated through lucrative TV rights and sponsorship deals, the influence it has brought with it has absolutely corrupted these men. Today their actions are making political crony capitalism look like amateur stuff. There is an urgent need to save the future of sport by cautioning and holding these men accountable for their conduct. We need to remind them again who they are here to serve and be clear that even as non-elected representatives their behaviour is important in preserving sports’ reputation and integrity.

We must all demand that these men be worthy of upholding the principles and values of the sports they represent, and that they are able to discharge their duties with humility, integrity and honour; always putting the good of the game ahead of their own greed and personal ambitions. It seems all these men have forgotten their purpose. So drunk on power have they become that they believe they can operate with complete impunity and function with zero external scrutiny or governance. Sport has the unique power to unite people and bring nations together. Sport, like the eternal flame, must be the beacon of hope and fairness in the world. With great power comes great responsibility.

2 comments:

  1. This is why I don't attend or watch sports...why should I support these zealots. I hope you reach many spectators with this information so that they may take control and not contribute to their overstuffed tax free pockets, then maybe things will change. It all starts from youth games...I already see how the shadiness is passed onto the hearts and minds of our future players. I witnessed just last week a soccer coach intentionally instructing his defense player to stick close to the goal while our teams players were noticeable further up the field (ref doesn't call offsides with 7years olds and younger). When our coach spoke to their coach about this he said it was strategy...already teaching his players how to be sneaky!

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  2. It's no more about the love of sport. It's the business of entertainment. And like all corporate bodies, sports associations, too, pay lip service to the values in their vision and mission statements

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