May 27, 2015 4:31 PM
FIFA's commercial partners urged to make their voices heard
The Associated Press
LONDON (AP) FIFA's sponsorship paymasters are facing mounting calls to put pressure on soccer's global governing body to clean up its act and fast following Wednesday's arrest of seven officials.
Companies like Coca-Cola, Visa and Adidas have in recent months shown a growing willingness to voice their concerns publicly about FIFA's string of scandals, which have spanned from past allegations of corruption to the abuse of laborers building World Cup venues in Qatar.
Wednesday's developments, which have also seen Swiss prosecutors open criminal proceedings into FIFA's awarding of the 2018 World Cup to Russia and the 2022 tournament to Qatar, should prompt them to demand change, according to a leading official at a global non-governmental organization.
"If you are putting many, many millions of euros into a business, then you definitely have a right and responsibility to demand that you are not tainted," said Cobus de Swardt, the managing director of campaigning group Transparency International.
De Swardt said Wednesday's developments should act as a "wake-up call" for everyone involved with FIFA, including the companies themselves, to push for big changes to the governing body's structures and practices. To start with, he said Friday's FIFA presidential election should be postponed and the current leader, Sepp Blatter, should be urged not to run again.
"FIFA needs a new start," said de Swardt. "These scandals have taken place under Sepp Blatter's watch."
The range of companies involved more or less directly with FIFA and the soccer world is large.
FIFA's partners, which are companies that support the soccer body through long-term contracts, include Adidas, Coca-Cola, Visa, Gazprom and Hyundai/KIA Motors. They have the right to use official FIFA trademarks in their advertising campaigns, exposure in and around stadiums and protection against ambush marketing.
There are second-tier sponsors, too, such as Budweiser and McDonald's, who pay to be involved during and around the World Cup tournaments themselves.
Beyond those corporations, there are companies that make deals with national soccer associations. Nike, for example, pays to have the Brazilian national team wear its shirts.
Though Nike was not referenced in the Department of Justice indictment, a "multinational sportswear company headquartered in the United States" is mentioned with regard to bribery allegations involving Brazil.
Without directly referencing the speculation that it is the multinational company, Nike said it was concerned by the "very serious allegations" and was cooperating with authorities.
"Nike believes in ethical and fair play in both business and sport and strongly opposes any form of manipulation or bribery," it said.
There are also marketing agencies that buy up the media and marketing rights for different FIFA competitions and in turn sell broadcasting and merchandising rights to media companies and corporations. One such company is Traffic Sports USA, which was named in the U.S. charges Wednesday.
Because of their more direct connections with FIFA, the body's sponsors and partners are among the most exposed to damage to their brands. Whether they will push FIFA more remains an open question, and so far none have come out with an aggressive criticism.
The reason: there's too much at stake. Corporations with long-term connections to the World Cup know that ending their relationships with FIFA could hand over to rivals what is, alongside the Olympic Games, one of the crown jewels in sports marketing.
"We've already seen sponsors making more noise than they ever used to," said Nigel Currie, an independent U.K.-based sponsorship and branding consultant. "But big sponsors get an awful lot of exposure and they'll be wary: if they pull out, one of their rivals will step in."
That doesn't mean sponsors will sit back as quietly as they have for years during previous FIFA scandals. Of late, they have been more and more vocal about problems.
Last week, for example, Adidas, Coca-Cola and Visa urged FIFA to push Qatar to improve conditions for migrant workers as the small Arabian Gulf country prepares to host the 2022 World Cup.
And at last summer's World Cup in Brazil, the sponsors of Uruguay striker Luis Suarez were quick to voice their aghast at his biting of Italian defender Giorgio Chiellini.
Without commenting directly on Wednesday's incident, Adidas, FIFA's oldest partner, said it's "fully committed to creating a culture that promotes the highest standards of ethics and compliance, and we expect the same from our partners." It urged FIFA to "continue to establish and follow transparent compliance standards in everything they do."
And McDonald's said it "takes matters of ethics and corruption very seriously and the news from the U.S. Department of Justice is extremely concerning. We are in contact with FIFA on this matter."
Currie thinks those involved commercially with FIFA could make their voice better heard if they acted together to urge a clean-up of FIFA's system.
"I think we'll see the pressure mounting in coming days," he said. "Sponsors don't like uncertainty or scandal; they want to be involved in something clean."
The views of the sponsors aren't something that FIFA can unilaterally ignore. They provide almost a third of FIFA's revenues. Recent figures showed that the organization generated $5.7 billion in 2011-2014, which encompassed the Brazil World Cup, with sponsors and commercial partners contributing almost $1.6 billion.
"When a business sponsors an event or association such as FIFA, it is effectively tying part of its brand with them," said Peter Walshe, Global BrandZ Director at London-based Millward Brown. "There needs to be a fit and when trust issues threaten the organization, the sponsor will need to monitor whether that will have a negative effect on the trust of the brand."
Mae Anderson in New York has contributed to this report.