Article originally published in the Philadelphia Business Journal on June 9, 2015
FIFA, the governing body of international soccer, suffered a significant blow to its reputation May 27, when the U.S. Justice Department issued a 47-count indictment against 14 FIFA officials and sports marketing executives.
The indictment charges these individuals with bribery exceeding $150 million, racketeering, wire fraud and money laundering over many years, including bribes to award the 2018 World Cup to Russia and the 2022 World Cup to Qatar, a Middle Eastern country with little soccer infrastructure and where temperatures can exceed 110 degrees. Not ideal conditions to play soccer. Other countries have also launched investigations into 2018 and 2022 World Cup host country selection process.
Football, as the sport is called outside the U.S., is the world’s most popular game, generating billions of dollars in gate fees, broadcast rights and advertising dollars. Rumors have been rampant for quite some time about the corruption within FIFA, which controls the decisions regarding of who financially benefits from the game.
In a statement released by Loretta Lynch, the U.S. attorney general, she stated, “[The corruption] … spans at least two generations of soccer officials who … have abused their positions of trust to acquire millions of dollars and kickbacks. … Today’s action makes clear that the Department of Justice intends to end any such corrupt practices, to root out misconduct, and to bring wrongdoers to justice…”
Sepp Blatter, president of FIFA, was indignant at the indictments. He replied, “The Americans were … [a candidate] for the 2022 World Cup and they lost,” suggesting that the action of the U.S. Justice Department was a result of that loss. He didn’t deny the corruption, only criticized those who brought it to light. Did he think that would enhance his reputation as president of FIFA?
Eric Zillmer, athletics director of Drexel University and guest commentator on ESPN, said, “So here we have the attorney general of the United States, where World Cup soccer is not as popular as it is in other countries, issue an indictment against FIFA officials. It is as if Blatter received a red card by an American referee.”
The magnitude of the money involved makes the sport ripe for corruption. Michael Garcia, the chairman of the Investigatory Chamber of the FIFA Ethics Committee and a former U.S. attorney for the southern district of New York, investigated the selection process for the 2018 and 2022 FIFA World Cup host countries. Garcia resigned his position in December 2014 when FIFA refused to make public his entire report. In its place, FIFA issued a summary of the report. Garcia stated, “[The summary report contained] … materially incomplete and erroneous representations of facts and conclusions.” One can only surmise that the refusal of FIFA to release the entire report of its own internal investigator indicates the extent to which FIFA will go to hide the truth of what really occurred during the selection process for the 2018 and 2022 World Cup.
Two days after the indictment was handed down, Blatter was reelected as president of FIFA, and then four days later, unexpectedly stepped down. He said he wanted to be viewed as taking the “high road,” stating, “I do not feel that I have a mandate from the entire world of football…” He is planning to stay in his current position until his replacement has been chosen, an event that is months away. Many governing members of FIFA are insisting he step down now, since the corruption occurred on his watch.
Blatter should have taken the high road and withdrawn from the election when the scandal broke. Better yet, he should have responded long ago to the rumors of rampant corruption that has plagued FIFA for years. He didn’t care about the organization’s reputation, nor did those members of the governing body of FIFA who elected him. One wonders the extent to which they financially benefited from the corrupt system.
So, what are the leadership lessons learned as the FIFA scandal unfolds? Tone at the top are the ethical standards by which an organization operates, and it is clear that Blatter did not set the proper tone and tolerated a culture corruption within FIFA. The investigation by the U.S. attorney is not over. It remains to be seen whether Blatter was directly involved in the corruption.
One thing is for sure – as the attorney general conducts her investigation, plea deals will be offered in exchange for evidence against the leaders of FIFA. We have seen only the tip of the iceberg. The facts will eventually come out regarding Blatter’s involvement and the involvement of corrupt FIFA officials and those corrupt individuals with whom they did business.
Blatter’s reputation and legacy have been permanently tarnished, regardless of the findings of the continuing investigation. He practiced leadership at its worst. Leaders, think about your reputation and the legacy you want to leave, and let those decisions guide the tone at the top and institutional culture you want to be remembered for.
Stan Silverman is a writer, speaker and advisor on effective leadership. He is the Leadership Catalyst at Tier 1 Group, a firm of strategists and advisors for preeminent growth. Silverman is vice chairman of the board of Drexel University, a director of Ben Franklin Technology Partners of Southeastern Pennsylvania and former president and CEO of PQ Corporation. Follow: @StanSilverman. Connect: Stan@SilvermanLeadership.com. Website: www.SilvermanLeadership.com