The Blog

Fifa: Shame on the Brands Making Corruption Possible


The American FBI swooped down and arrested seven top officials of the world football body Fifa in Switzerland yesterday. Even though it is a story from the world of sport, enormous sums of money and corruption are involved, so football (or soccer in the USA) is dominating the global news agenda.

But in an emergency meeting today, Fifa president Sepp Blatter said that he couldn't be held responsible for every action that takes place inside the organisation and that he still intends to stand again in the presidential election tomorrow. Fifa elects a president in the year after every World Cup competition and Blatter has been president since 1998, although he has worked at Fifa since 1975.

Figures from across the football world have called for Blatter to stand down. If this level of corruption were uncovered inside a government department then the minister responsible would be expected to step aside - likewise the CEO of a private sector firm undergoing this much turmoil - but Blatter defies all expectation of how an executive should behave.

But the real scandal lies outside Fifa in the private sector. Fifa's main product is the World Cup and this enormous competition requires big sponsors. It is brands such as Coca-Cola, McDonald's, Budweiser, Adidas, and Visa that bankroll Fifa and their World Cup competition.

These sponsors could demand change. They could kick Blatter so far from the presidency that he doesn't land in Russia until the next World Cup is complete - but none of them have. The closest any of the sponsors appear to have come to stepping away from Fifa is a warning from Visa suggesting that they might need to "reassess" their sponsorship.

Overall the message from the brands is that they are disappointed, but they will all continue to support Fifa. Why?

Because they all know that an air of corruption has hovered over Fifa for decades. Blatter has been accused of buying votes for his presidency position going right back to his first election. There is nothing new in generally suggesting that Fifa is an organisation that needs to be reformed, but the public ignore this whiff of corruption when the World Cup comes around every four years. The former head of branding at Visa even blogged about this yesterday saying:

"ARE YOU MAD? The FIFA World Cup is the most popular sporting event in the world. People love it. They don't care about the corruption. Yes, really. They know it has been going on for decades."

If the public ignore the way that Fifa is managed then the brands are happy to ignore it too. Visa says they are disappointed in Fifa, but they will not just pull their sponsorship because then Mastercard will take it. Likewise Coca-Cola is scared that the official beverage of the next World Cup will be Pepsi - and Budweiser knows that the fans would be just as happy to drink Heineken. In fact, most would prefer it.

The real scandal of this Fifa affair is that every business school in the world spends time and effort teaching business students that ethical decision-making is central to doing business today - particularly cross-border global marketing and branding. However, the reality is that every major brand supporting Fifa is prepared to hold their nose so they can ignore the stench of corruption, because they are terrified that a competitor will snatch their place at the World Cup.

Shame on all the CEOs of the Fifa sponsors. If they joined together and included their major rivals in a group that publically declared they would not sponsor Fifa until after the next World Cup then perhaps world football would have time to clean up its act. But the reality is that money talks.

The message from companies such as Adidas, Visa, and Coca-Cola to MBA students the world over is to just ignore business ethics 101 - it means nothing once you leave the classroom.

Before You Go