2 billion in annual television rights and advertising. This wealth, coupled with a lack of accountability to any public body, creates opportunity for corruption to flourish. The instances of corruption surrounding the World Cup bids were not related to the television rights, but once the culture of corruption has become ingrained in the organization, it can seep beyond the boundaries of internal corruption. The World Cup corruption was ultimately both at work -- internal vote-buying from bin Hammam and a susceptibility on the part of other members of the executive committee to seek money for votes from external bodies such as British officials seeking the 2018 World Cup (Sharp, 2011).
Another critical issue that contributes to corruption in international sport is the lack of understanding of how corrupt practice become ingrained in an organization, and either an unwillingness or inability to address the issue. FIFA has an inept ethics committee that must be prodded into action by investigative journalism; its leadership is unfazed by corruption allegations and the organization still lacks transparency. Part of this could be attributed to neoliberal ideals that cause the organization to want its members to be of high ethical standards, and therefore makes the organization reticent to carry out due diligence. The reality, however, is that different cultures are prone to corruption to different levels, and as a result any international organization needs to build safeguards into its system. If the organization is unwilling to have external safeguards -- democracies have the voting process and open media as theirs; corporations have shareholders and external regulators -- then it must have stringent internal controls against corruption.
Outcomes of Corruption in International Sport
The reason controls should be strict is that the outcomes of corruption in sport are far from trivial. The first outcome is that sponsors will be less likely to be involved at the sport. This not only hurts an organization like FIFA, which can withstand the loss of capital, but also smaller, affiliated organizations. In the wake of the recent scandal, Coca-Cola and Adidas both expressed concern about the scandal and cast their long-term relations with the sport in doubt (The Independent, 2011). The withdrawal of funding from FIFA and other soccer organizations hurt poor nations in particular, as they often rely on funding from international bodies for their sporting programs. This is an especially high risk when the scandal is directly tied to such programs. British officials were asked for a bribe for the 2018 bid, with some of that money going to fund a program in Trinidad & Tobago (Sharp, 2011). With a direct tie between work that theoretically benefits athletes in the developing world and corruption, the ability of those athletes to receive funding in the future is put in jeopardy.
Another outcome of corruption in international sport is the waste of money and the mistrust of the process. The nations that applied to host the World Cups did so in good faith, and ultimately their future participation in the program hinges on their ability to interact with FIFA in good faith down the road. The organization relies on ticket sales and television revenues from Western nations primarily, and those are the same nations who lose money bidding on events they have no chance of hosting, and whose publics are offended by the corruption that they see in the organization. FIFA, for example, might be able to bank on Europeans continued support despite the corruption because of the sport's popularity there, but it is unlikely to enjoy continued support in nations that are less fascinated by soccer but are financially important such as the U.S., Australia and Japan. The IOC faced a similar dilemma with respect to the figure skating scandal -- the Winter Olympics relies on television ratings from two major sports -- figure skating and hockey -- to drive rights revenues, and in particular from the U.S. And Canada. The figure skating scandal was a direct threat to the financial viability of the Winter Olympics because it would have reduced the revenue potential of broadcast rights in the key North American market.
A third outcome of corruption in international sport is that it reflects poorly on the nations involved. Corruption is a global problem, with strong negative impacts on economic progress. Negative outcomes associated with high levels of corruption include decreased trade flow, decreased foreign direct investment, lower per capita income (Davis & Ruhe, 2003), lower labor productivity, lower worker compensation levels and lower productivity growth (Soon, 2006). Corruption in sport receives a disproportionate amount of press coverage. The FIFA scandal in particular receives coverage in the UK, the U.S. And Australia, all countries with losing bids. Corruption in sport receives more coverage than incidents of corruption that are country-specific or industry specific, because such stories have a broad public interest and are international in nature. Whereas a nation accused of corruption in, say, a mining contract, will only see its reputation damaged in that industry, a nation involved in corruption in FIFA or the IOC will see its reputation damaged around the world, by a wide swath of potential investors. The corruption reinforces the perceptions that people have of many nations, and can dissuade investment in those nations. For example, Qatar will face scrutiny for its corruption right through the 2022 World Cup event, and if that event is not perfect the nation will spend decades shaking off the impact of such high profile corruption. The problem with corruption in sport is that it has a much broader impact than simply on the organization involved -- the perception of corruption trickles through an entire nation's economy.
There are a number of recommendations that can be made with respect to eliminating corruption from sport in the future. The first is to admit that corruption not only is possible but occurs regularly. The evidence that has emerged in the wake of the FIFA investigations is that corruption is endemic. The IOC has faced corruption scandals more than once, and Fisman (2010) argues that corruption in figure skating still exists despite the best efforts to remove it. Neoliberal ideals argue that multinational organizations will eventually move towards a common set of ethics, and this is true. But it is necessary to recognize as a matter of principle that this common set of ethics will not necessarily be those of the nations with the highest ethical standards. Even the United Nations is not free from bloc voting, and the trading of financial aid for support in its various bodies. It must be recognized from the outset that if the ethical standards are to be those of the nations whose standards are highest, that steps will need to be taken to ensure this happens. Those nations cannot simply, by the fact of their existence or their presence in the room, impose their ethical standards on delegates from nations with vastly different cultures and responses to corruption.
The second recommendation is that organizations adopt higher levels of internal control. FIFA, for example, has an ethics committee, but that committee's executive is comprised of members from countries with terrible ethical records. Whether coincidence or not, the committee has overlooked all questionable ethical practices until tremendous public pressure was brought to bear, primarily by British media outlets. FIFA also has a set of ethics guidelines, and the ethics committee has strong enforcement powers. The guidelines should be clear, and members joining the organization should be given full ethics training so that they are fully aware of the ethical standards to which they will be held to account. In addition, the ethics committee should be comprised of members with impeccable ethics records, even if this means precluding some countries from involvement. Lastly, the organization should have an oversight group with respect to specific processes such as voting. Had there been a more coherent set of criteria on which to base votes for World Cup sites, the members may not have been able to sell their votes so easily. Qatar, for example, could not have won the Cup on account of the searing temperatures to which the players will be exposed.
The third recommendation is that international sporting organizations have greater transparency to external stakeholders. As present, neither the IOC nor FIFA have a high level of accountability to even their constituent bodies, such as national Olympic committees or football association, let alone to media, fans, governments and other external stakeholders. With greater transparency comes greater accountability, especially when coupled with strong enforcement mechanisms and the willingness to use them. It is important that those who would commit corrupt acts realize that their individual actions will be subject to scrutiny -- this may dissuade all but the most corrupt from committing these acts in the first place.
The fourth recommendation is that leadership of international sporting bodies take responsibility for the ethical climate in their organization. At present, there is no accountability among the leadership of FIFA, and very little at the IOC.…