BrandArena: What Does FIFA Corruption Scandal Mean To Sport Business?

Wednesday 3 June 2015

What Does FIFA Corruption Scandal Mean To Sport Business?

Sepp Blatter, who has served as president of FIFA soccer’s governing body for 17 years, is set to resign. The announcement comes just days after allegations of corruption pertaining to his administration came to light.

Blatter, who is considered one of the most powerful people in global sports, announced his resignation on Tuesday via a speech delivered at the FIFA headquarters in Zurich, New York Times reports.

According to the reports: Last Wednesday, police raided a five-star hotel, where seven soccer officials were arrested and held for extradition to the United States on corruption charges.

The arrests were followed by a detailed explanation by United States Justice Department officials on their investigation into FIFA. And from there came an initial dismissal by FIFA of the widespread nature of the charges; a defiant Mr. Blatter winning re-election to a fifth four-year term as president and his claiming that he would pilot FIFA’s battered boat “to shore”; a linking by United States officials of Mr. Blatter’s top deputy to a series of payments that are believed to be bribes; and, finally, just before 7 p.m. Central European Time on Tuesday, Mr. Blatter’s announcement that he would step down from the organization he has served, in various roles, for 40 years.

According to Goal on Wednesday, June 3, the outgoing Fifa president Sepp Blatter is being investigated by the Federal Bureau of Investigation (FBI).

A number of figures have since expressed interest in the role, including former France midfielder David Ginola and Prince Ali Bin Al Hussein, the rival he defeated in Friday's election.

Elections to replace Blatter are set to be held between December and March.

Football is a multi-billion dollar business. It has intricate ties to political and private interests. This means rich opportunities for corruption. Yet across the sporting sector, most deals and decisions take place behind closed doors. This allows corruption to go unchecked and unpunished. But what does the whole corruption saga mean to the biggest world sport?

Corruption inevitably leads to a diminished business climate when the public trust is put at risk. Reputation and efficiency of the round leather game business suffers as it increases inequality.

Estimates show that the cost of corruption equals more than 5% of global GDP (US$ 2.6 trillion, World Economic Forum) with over US$ 1 trillion paid in bribes each year (World Bank).

As a governing body, FIFA need to conduct fear and fair election come December and March. The body needs to lead by example and ensure transparency in order to regain the game lovers' trust.

In conclusion, there is a need for check and balance because "absolute power corrupt absolutely".

Image credit: shutterstock

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