The way sport is governed has been put under the spotlight as stakeholders become increasingly vocal due to repeated failures
ICSA’s first venture into the area of sports governance came in 2016, when in January the Advanced Certificate in Sport Governance and Administration was launched. At this time the sector was only coming to truly realise the scale of the challenge ahead because repeated failures at all levels of sport globally, some of them extremely high profile, meant the broad range of stakeholders were becoming increasingly vocal.
This was not of surprise to me however as I had been working in the area of sports law since 2011. However, what had really opened my eyes to the realities of trying to govern sport, was my appointment in January 2014 as a non-executive director and company secretary for a small national governing body. I then knew how far behind the sector was when it came to employing even the most basic good governance practices which were widely accepted in the modern world. Sport was far from the Corinthian values of times past, and no longer just the pursuit of on-field success. Rather, at all levels of the sporting pyramid organisations involved in the sector had to be successful off the field as well and accept good business practices as a result.
The reasons for shortcomings in sports governance were succinctly put in 2014 by the authors of the Final Report for the FIFA Governance Reform Project, who said that inappropriate conduct was usually down to a combination of three factors: personal greed, a breakdown in systems and controls, and a lack of ethical and moral culture within an organisation.
There are many well-documented examples of all three of these factors, with one of the more troubling in recent years where sports organisations (including the World Anti-Doping Agency (WADA) and international federations) have been targeted by hackers, who have stolen athletes’ private and personal medical data and leaked it to the public. Data protection regimes across the world are becoming more stringent, led by the European Union with the General Data Protection Regulation, so should sports organisations exhibit similar failings in the future and breach such regimes they are likely to face not only a further erosion of trust but also sizeable punitive fines.
A desire to move away from the traditional concept of the autonomy of sport, and general loss of faith in those organisations governing the sector, is no better exemplified than by the multiple and on-going threats from athletes to join so-called ‘breakaway competitions’ to realise their full earning potential in what is often a short career. Attempts by the Olympic movement federations to prevent this, principally by seeking to bar such athletes from the Olympic Games, have been successfully challenged at the highest levels of politics and the law. Most prominently, the EU Commission decided that the International Skating Union’s (ISU) rules imposing severe penalties on athletes participating in speed skating competitions not authorised by the ISU were in breach of EU competition law.
A landmark development in sports governance in the UK came in October 2016 with the publication of the Code for Sports Governance by UK Sport and Sport England. The achievements made by those governing bodies either receiving, or striving for, funding from those two quasi-public bodies was quite remarkable in a short period of time, given that by December 2017 55 of the 58 national bodies for sport involved in the compliance process were confirmed to have met all the necessary requirements of the new Code.
However, the issue then becomes how are all the documentary and policy changes made to comply with the Code implemented to be effective and sustainable in the modern sporting environment? Attempting to address this question drove many of the additions to the ICSA Study Text: Sports Governance [February 2018] to create the newly published ICSA Sports Governance Handbook [June 2019].
A unique challenge to the current and future governance of sport has been a multitude of duty of care concerns, in particular those concerning safeguarding and participant welfare.
For governing bodies, such issues may mean an entire change in the strategic priorities of the organisation because such grievances and allegations, even if historic, have to be dealt with fairly, effectively and promptly.
For instance, and as a warning to sports boards, the total cost
of the Independent Review into the Climate and Culture of the World
Class Programme in British Cycling was around £90,000.
Failings in respect of the duty of care owed by governing bodies to participants is indicative of a culture in the sector which is not fit-for-purpose in modern society. Culture is undoubtedly one of the most difficult areas in which to effect change as it involves the use of ‘soft skills’.
These cannot be learned easily from a book and are only truly developed by working within an organisation and understanding the dynamics between the individuals involved.
That is not to say that there are not principles of culture that can be agreed, adopted and implemented by the board of a sports organisation. Which is why it was felt it was necessary to specifically include this in a new expanded chapter ‘Integrity, Ethics and Culture’ in the Handbook, with reference to ICSA’s Organisational Culture in Sport report [May 2018].
Indeed, UK Sport Chair Dame Katherine Grainger said this in November 2017, “Getting our culture right is simply the right thing to do. This isn’t about putting welfare before performance because there isn’t a choice between the two.
I genuinely believe that a better culture will lead to a stronger system and that in turn will help improve performances”.
A key driver of change in any sector are its stakeholders. To have a stakeholder inclusive approach to decision making, a sports organisation must make the ‘stakeholder voice’ a meaningful part of the process. This is a significant challenge because of the conflicts inherent in the purposes of many governing bodies, which will include one or more of the following: growing the sport in question at the grassroots level, regulating the sport, achieving commercial success and ultimately making the sport sustainable for generations to come. Often the most powerful group of stakeholders in a sport organisation are the members.
However all too often other influential stakeholder groups are overlooked and not given the respect they deserve, principally the players and other participants in the sport (e.g. referees, coaches, physios, staff in the community etc). Other significant stakeholder groups in sport are commercial partners, funding bodies, supporters and local communities. When it comes to funding, since the introduction of lottery funding for sport in 1997, many UK sports have become overly, and in some cases exclusively, reliant on public investment. However, there has to be a rapid realisation that such funding is not going to be in great abundance going forward due to the general economic outlook for the country, and that as a result governing bodies must look for alternative sources of income to become sustainable. Diversifying the funding of an organisation through alternative income streams can include hiring out facilities, crowdfunding campaigns, innovative commercial partnerships and accessing social finances. Whilst these offer new opportunities, they also present challenges to sports bodies. Those who can provide such income will not want to provide it to organisations who do not have robust, effective and sustainable governance.
The modern sporting environment presents a myriad of both historic and current governance challenges, and whilst much good policy work has been done, the implementation of these changes by sports organisations will be vital to their effectiveness. All stakeholder groups will be watching the months and years to come in the sports sector with interest.
Kevin Carpenter is Principal at Captivate Legal & Sports Solutions
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