Wednesday, June 1, 2011

Sepp Blatter wins Fifa president election

Sepp Blatter, the only candidate running in the election, has won a fourth term as Fifa president. Joseph "Sepp" Blatter appeared headed for election to a fourth term as president of global football's governing body amid mounting concerns about corruption allegations voiced by corporate sponsors and the complaints of two football associations that called for Wednesday's vote to be delayed.

FIFA President Sepp Blatter appeared unconcerned about talk of scandal and corruption when he opened the annual conference of world football's governing body in Zurich on Tuesday.

The Fédération Internationale de Football Association, or FIFA, has been engulfed in turmoil in recent days by allegations that both its decision to award the 2022 World Cup tournament to Qatar and its Wednesday presidential election are tainted by improper payments. Two senior FIFA executives—including Mohammed bin Hammam, who had been Mr. Blatter's only rival for the FIFA presidency—have been temporarily suspended by the FIFA ethics committee related to allegations about the election.

Mr. Blatter, who is left with no opponent in Wednesday's leadership election, has shooed away criticism of the organization, telling a news conference late Monday: "Crisis? What is a crisis?"

A FIFA spokeswoman said Tuesday the organization has not said whether the election would be postponed.

But some of FIFA's most important patrons—its corporate sponsors—have stepped forward to express concern about scandals at the Zurich-based organization. By late Tuesday, four of FIFA's six most significant partners had raised the issue, with Visa and Emirates Airlines following concerns raised earlier by Coca-Cola Co. and Adidas AG.

"The current situation is clearly not good for the game and we ask that FIFA take all necessary steps to resolve the concerns that have been raised," Visa said in a statement.

Emirates Airlines said it was "disappointed with the issues that are currently surrounding the administration of this sport," the Associated Press reported.

Adidas, which provides the official ball for the World Cup, said "the repeated accusations [of corruption] are neither good for the sport of football nor for FIFA as an institution and its partners."

An FIFA ethics panel ruled Sunday it would launch a full investigation into claims that two top officials—Mr. bin Hammam, a Qatari who is president of the Asian Football Confederation; and Jack Warner, president of the North, Central American and Caribbean Football Federation—offered $40,000 payments to Caribbean football leaders ahead of the FIFA presidential election in which Mr. bin Hammam was a candidate. Mr. bin Hammam withdrew his candidacy hours before being suspended on Sunday, but both he and Mr. Warner have denied and plan to contest the allegations.

The suspensions came on the heels of another incident last year, when two other executive committee members were banned after they allegedly offered to sell their votes for the 2018 and 2022 World Cups to undercover reporters for the Sunday Times.

Controversy over the presidential election grew on Monday, when one of the suspended officials, Mr. Warner, released an email from FIFA General Secretary Jerome Valcke that appeared to suggest Qatar had "bought" the 2022 World Cup hosting rights with bribes. Mr. Valcke denied that he meant to imply any wrongdoing.

Nonetheless, the English Football Association has called for Wednesday's election to be postponed, a move that was later supported by the Scottish Football Association. English FA Chairman David Bernstein said Tuesday he was concerned about a lack of accountability and transparency within FIFA, and called for the delay to allow an alternative reform candidate to emerge.

Scottish FA chief executive Stewart Regan said: "The events of the last two days, in particular, have made any election unworkable."

England's association also said it wanted an independent external party to make recommendations regarding improved governance and compliance procedures and structures throughout the FIFA decision-making processes.

Mr. Blatter must win a majority of the votes from football association members around the world. There are a total of 205 voters.

Even as Mr. Blatter dismissed the notion that FIFA is in crisis, he conceded Monday that the group's reputation has been damaged. One place where that could hurt is in the sponsorship arena, an area that generated $342.9 million in marketing rights for FIFA in 2010, according to FIFA's 2010 financial report reviewed by The Wall Street Journal.

Simon Chadwick, professor of sports business strategy and marketing at Coventry University, warned sponsors could potentially pull out and they are implicitly demanding change at FIFA driven by consumers' concerns.

Companies "want to sponsor the World Cup because it is global, glamorous, exciting and they want these images or qualities to reflect on them," Mr. Chadwick said. "The problem starts when FIFA starts having an image of being a corrupt organization with poor governance. He added: "If consumers see these companies are complicit and are condoning this, their sales and bottom line could suffer. Sponsors could potentially pull out from the World Cup."

Another marketing analyst, however, said the leverage of current sponsors was limited because they fear losing the tournament to rivals.

"For that reason, it's very difficult for them to exert pressure," said Shaun Whatling, CEO of the London-based Redmandarin agency. He recommended a collective letter from sponsors calling for an independent inquiry "to clear the name of FIFA and its president."

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