By Jeff Najjar
Sports remains one of the most popular recreational activities in the world and generates annual revenues of more than $145 billion. Corruption in sports is not a new phenomenon, with match-fixing, illegal transfer of players, money laundering, and rigged construction contracts for stadiums and international tournaments commonly occurring in international sports. However, the recent indictments of nine current and former Federation International de Football Association (FIFA) officials on charges of racketeering and money laundering have brought the systemic culture of corruption in global sport bodies to the forefront of international attention.
The FIFA scandal is not unique in international sports corruption. For example, the leadership of the FIVB—which oversees international volleyball—has faced years of corruption allegations. Additionally, the International Wrestling Federation (IWF) and the organizations that govern international handball and cycling have faced similar allegations of corruption. Although international efforts to combat corruption have made substantial progress, international sports bodies reside within a global governance void that falls outside the scope of current international anti-corruption regimes.
International and domestic sporting events are big business. For instance, the Sochi Winter Olympics were estimated to have cost $51 billion. However, sports organizations are commonly afforded “non-profit” or “non-governmental organization” status in many jurisdictions. The non-profit or non-governmental status allows organizations such as FIFA to operate with minimal effective external oversight. The lack of effective external enforcement is facilitated by countries such as Switzerland and the United Arab Emirates, which have historically afforded organizations favorable tax breaks and legal status. Despite occasional threats by Swiss politicians to increase efforts to eliminate corruption, there has been little substantive change in preventing corruption until the most recent indictments of the nine current and former FIFA officials. Despite the lack of accountability, corrupt organizations such as FIFA can be reformed in a similar fashion to how the global community responded to the doping scandal with the Tour de France.
In 1998, the Tour de France was marred by a doping scandal, known as the Festina affair, when the winning team was found with banned steroids, syringes, and other doping related products and paraphernalia. The Festina team’s director, doctor, and nine riders were all arrested. At the same time, the International Olympic Committee (IOC) was involved with a scandal over bribes given by the Salt Lake City organizing committee, which had been awarded the 2002 Winter Games. Although the Festina affair had raised global awareness toward scandals and corruption in sports, the institution best situated to respond to the doping scandal was itself ironically involved in a bribery scandal. Therefore, reform had to come from another source. The global governance void in this particular scandal was filled by the creation of the World Anti-Doping Agency (WADA), which is co-governed by sports organizations and governments. WADA became part of international law when it was formalized under the international treaty, the United Nations Education, Scientific, and Cultural Organization in 2005. More than 170 nations are party to the treaty, including the United States and have become widely successful as a global governance regime.
International authorities can address situations such as the FIFA scandal by using a similar approach. A treaty framework can establish cooperative and coordinated international policies to combat corruption in sports that allows countries to engage in shared approaches to investigations and sanctions. The success of this cooperative approach has recently been demonstrated by the joint efforts of U.S. and Swiss authorities in prosecuting FIFA officials. Moreover, this cooperative model can be strengthened through the establishment of a reform mechanism to fill the global governance void, such as the creation of an international agency like WADA.