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Global governance standards

17 November 2017

FIFA is an entity which has been bedevilled by controversies, not least of which have been the allegations of corruption, providing stories of intrigue, deceit and scandal fit for Hollywood.

As an advocate of good governance, I am probably a little biased about how interesting a subject it is, but even I would not have thought it to be so engaging a topic that a movie should be made about it. That is exactly what is on the cards however, with a film starring Tim Roth and Gerard Depardieu set to dramatise the goings on at FIFA’s governing body.

 

FIFA is an entity which has been bedevilled by controversies, not least of which have been the allegations of corruption, providing stories of intrigue, deceit and scandal fit for Hollywood. With its opening timed to coincide with the 2014 football World Cup, the film is guaranteed maximum publicity. Depending on how the movie addresses the governance issues involved, the film has the potential to bring governance issues to the attention of the public in an unprecedented way.
It is interesting how awareness of governance has developed over the years and how its relevance to so many diverse organisations has increased exponentially. Within a remarkably short space of time, it has gone from being the specialist domain of our largest private companies to the frequent subject of press comment, an element of many university courses and part of the mainstream thinking of most enterprises.  

 

Many of us have witnessed this transformation first-hand, from its emergence in the early 1990s to present day practice. We have watched its unfolding and can recall the background and catalysts to changes that have come about over the years. Increasingly these developments have an international flavour, in terms of the ripple-effect that an issue in one jurisdiction can have elsewhere, as well as in terms of the dissemination and sharing of practices worldwide. I was reading recently about a project to raise awareness of good corporate governance across Mongolia – just one example of how true globalisation of best practice is being driven.

 

When one reads about the deaths of migrant workers when building Qatar’s World Cup 2022 stadiums or allegations of corruption in the awarding of contracts for the 2010 Commonwealth Games in India, the need for standards to be raised worldwide is emphasised. More than that, the ability of international sporting bodies to influence the governance agenda is highlighted.  

 

The construction workers killed in Qatar were part of FIFA’s supply chain for the 2022 World Cup, in the same way that Rana Plaza factory workers in Bangladesh were part of the supply chain for UK clothing stores. Responsibility for ensuring a supply chain meets satisfactory standards is not devolved elsewhere simply because contractual arrangements have broken any direct links between the two end parties.

 

With countries virtually tripping over each other to provide a venue for key events in the sporting calendar, there is no shortage of viable host nations. There is surely no reason why little more than lip service should be paid to good governance, as a condition of making those selections. Nor should the imposition of good governance requirements be seen as a barrier to less developed parts of the world being selected for these honours. It should instead be seen as the driver of yet another economic benefit that may be derived from hosting an event such as the World Cup.

 

If conditions of good governance were seriously applied, selection to host the World Cup or similar would offer the greatest incentive for a nation to come together to reduce corruption, improve working and trading conditions and enhance general business practices to ensure the event’s success.
Global governance standardisation is not just about ethical issues. Unless an organisation’s governance has sufficient reach, it may be exposed to external risks which fall within its sphere of influence. These risks are capable of being measured, managed and mitigated.

 

Failure of a company’s suppliers may be one of the key risks to which a business may be exposed and so it is simply good business sense to ensure that those suppliers are well run. The development of corporate governance understanding means that well run no longer equates only to well managed, it must mean well governed too.

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ICSA: The Governance Institute
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