Recently I spent some time in the Kingdom of Bahrain with representatives of the sports industry based there who were keen to gain a greater understanding of sports governance and leadership. They say that timing is everything in sport so I can't pretend I wasn't disappointed by being able to add the recent shenanigans at SportAccord and FIFA into the discussions. By the end of my time there – with Marius Vizer and Sepp Blatter both having fallen on their metaphorical swords before I even had time for an extra portion of hummus – my Bahrain audience members were running a sweepstake on who might replace them and indeed on who might resign next in the world of sport.
Who knew governance could be such fun?
Governance was one of the areas that we looked at closely when determining the recent SportBusiness Ultimate Sports Federation winners. The category winner for governance itself was the IOC in recognition for its efforts with Agenda 2020 but many of the international sports federations (IFs) that scored well were particularly proactive and transparent when it comes to the matter of governance. FIBA scored well in this category, as did the FEI by ticking all the right boxes when it comes to accountability and quite frankly, some good old-fashioned honest engagement with their key stakeholders.
With some IFs still relying on an element of self-assessment when it comes to governance, our discussions in Bahrain turned to the human element of sport and whether people can ever truly be relied upon to do the right thing when it comes to declarations of self-interest or previous wrongdoings. It doesn't take a rocket scientist to figure out that people with bad stuff to hide tend not to want to fess up about it. Doh.
In Switzerland – where many of the worlds IFs are based after all – they have recently decided to toughen up in this regard by introducing a new law. The Swiss Federal Council passed a mandate on 13 December 2014 that will require banks to closely monitor the accounts of the heads of IFs for any suspicious activity. "Banks will also have to closely monitor the accounts of members of the Federal Parliament, the Federal Council and international sporting federation officials," read a statement.
The law (13.106) implements the 2012 recommendations of the Financial Action Task Force (FATF), which are designed to combat money laundering and terrorist financing. It re-classifies the heads of international sporting federations as Politically Exposed Persons (PEPs).
The FATF defines a PEP as somebody "entrusted with a prominent public function". As such, it recognises that many PEPs "are in positions that potentially can be abused for the purpose of committing money laundering (ML) offences and related predicate offences, including corruption and bribery". Due to this danger, FATF Recommendations 12 and 22 require countries to ensure that financial institutions and other professions implement measures to prevent "misuse of the financial system and non-financial businesses and professions by PEPs, and to detect such potential abuse if and when it occurs".
The heads of international sporting federations were previously exempt from money laundering measures, as they were considered heads of private organisations under Swiss law. Switzerland also plans to introduce legislation making bribery and fraud in sport a criminal offence. Although bribery of public officials is currently illegal in Switzerland, private bribery is only punishable on demand, and then only if it is linked to an act of unfair economic competition.
"FIFA was an organisation with the same status as a yodelling association in a mountain village," declared Roland Büchel, an MP with the Swiss People's Party (SVP), who had long campaigned for reform. Whether Sepp Blatter starts rhapsodising harmoniously on the merits of goat herds come the end of 2015 when his successor is found however remains to be seen.