USOC’s Problems Endanger Financial Support
By DAVID CARTER
The Olympic motto of “Higher, Faster, Stronger” has taken on a decidedly new meaning over the last several weeks.
How much higher can the United States Olympic Committee’s tolerance of alleged corruption and apparent conflicts of interest climb? How much faster can its integrity be compromised? And just how much stronger can its collective sense of denial become?
In some circles the motto’s pristine connotation remains, albeit under the stewardship of a seemingly lone, yet vociferous advocate, David D’Alessandro, chairman and chief executive of Olympic sponsor John Hancock Financial Services. D’Alessandro wrote in a letter to USOC President Marty Mankamyer and Chief Executive Lloyd Ward that “It is no longer possible to overlook the seemingly non-stop turmoil and controversy that afflict your organization.”
In 2000, Chief Executive Sandy Baldwin quit after admitting she falsified her resume. Ward, Baldwin’s successor, has been accused of improperly attempting to direct business to a company that employed his brother. The head of a panel reviewing the matter was subsequently accused of telling the USOC’s ethics officer to cover up the allegations. These developments have spawned numerous USOC resignations and drawn the attention of U.S. Senators Ted Stevens and Ben Nighthorse Campbell.
Still recovering from international scandals, and compromised by major ethical lapses here in the States, stakeholders such as Hancock are adamant that these current events cannot be accepted as business as usual. Doing so will cost the USOC dearly, both in terms of credibility and cash flow. D’Alessandro even went so far as to say that the Olympic committee was a dysfunctional family that keeps electing the daft cousin or uncle to the top job. He suggested that their bureaucracy must be blown up and restructured.
While D’Alessandro no doubt recognizes that the Olympics has evolved beyond the ideals of nationalism and excellence in amateur competition, he knows that absent a return to ethical standards, the Olympic movement can no longer bank on his company’s financial support as a major sponsor.
Hancock is in the business of selling trust. Consequently, what could be sending more of a mixed message to his customers and shareholders than the company’s high-profile association with the USOC? Any stain on the USOC is sure to be felt by its sponsors, particularly those sponsors known for taking a stand, for protecting their brands’ image when others have abdicated the responsibility.
D’Alessandro still believes in the Olympic movement. So much so that he has asked for a complete accounting of the USOC’s management and financing in an effort to uncover any other possible problems and address any further potential damage to a marketing platform he and his company value.
But any failure to rapidly and thoroughly address the USOC’s recent spate of indiscretions could not only cost additional corporate support, but will jeopardize the U.S. reputation throughout the International Olympic Committee possibly undermining New York’s bid to host the 2012 Summer Games.
Carter is the author of “On the Ball: What You Can Learn about Business from America’s Sports Leaders.”