Recent scandals amongst high-profile sports governing bodies have thrown the global spotlight onto sports governance . The FIFA revelations proved especially shocking.
In many ways, FIFA perfectly encapsulates the problem sport is facing. On paper, FIFA’s governance structures scored highly. In fact, according to the Sports Governance Observer (SGO) index - in a report published mere months after the FIFA scandal broke - it was the second highest ranked International Federation. In practice, FIFA were found lacking. Whilst many international governing bodies have in place apparently robust governance structures, they still too often suffer from a shortfall of independence, diversity, and accountability.
Against this international backdrop, the UK, with its comparatively strong record in corporate governance is seeking to set the "gold standard"for sports governance. With more public money than ever being channelled into UK sports and a global focus on the shortcomings of sport governance, the stakes are high. The British public is increasingly demanding - and deserves -reassurance that its money is in safe hands.
It is expected that UK Sport, in conjunction with Sport England, will shortly launch the anticipated UK Governance Code for Sport (GCS). The GCS, which will have effect from 2017, is the latest iteration of sport governance provisions to emerge. It was borne out of UK Government’s 2015 "Sporting Future" strategy which set out the roadmap for the introduction of a new mandatory sports governance code. This was followed, in May 2016, by the Charter for Sports Governance, which set out the basic framework of the GCS.
So what can we expect to be different about the GCS? Who will it affect and in what ways?
The primary difference between the GCS and its predecessors is the fact that compliance with its provisions is expected to be mandatory for all English national sport governing bodies (NGBs) and sport organisations in receipt of public funding.
NGBs are the bodies responsible for administering their respective sports at a national level. They receive monies from the Department for Culture, Media and Sport together with the National Lottery through UK Sport for elite sport and through Sport England for grassroots development, general participation levels and facilities.
UK Sport and Sport England invest in NGBs in four-yearly funding cycles covering a complete Olympic and Paralympic period. The funding cycles for Rio 2016 end in 2017.
Importantly, the precise consequences of non-compliance with the GCS have yet to be revealed. However, reading between the lines of the Charter, it appears that, from 2017, an NGB will only succeed in obtaining funding if it can demonstrate compliance with the GCS’s standards. It follows that an NGB which fails to maintain compliance with the GCS throughout the funding cycle risks its funding being reduced or withdrawn.
Put bluntly, it seems the difference between the GCS and its predecessors is that this one has teeth.
Given that the GCS will apply to the full spectrum of sporting organisations receiving public funds, it is expected that it will adopt an element of proportionality in its application and enforcement. This should ensure, for example, that the standards applicable to England Handball are not the same as those applicable to The Football Association.
The GCS is framed as an "ambitious" regime. On the basis of the Charter, key standards are expected to include:
• Transparency and financial probity - NGBs will be expected to publish annual reports and accounts, making clear their strategy and governance structure. The expectation is that every penny of public funds must be fully accounted for. Organisations must demonstrate that they are using public funds for the purpose they were given.
• Integrity – NGBs must demonstrate that they have in place adequate measures to protect against sport manipulation. Senior officers, such as Board directors, are likely to be expected to sign a declaration that they possess the necessary skills to fulfil their role and are of "good character".
• Leadership (decision-making, diversity, and independence) - the GCS is expected to prescribe certain elements of NGBs’ Board composition. It is expected that this will focus on issues such as the size of Boards, term limits of members, independence and diversity, for example by increasing targets for female and independent Board members.
• Further consultation - it is expected that UK Sport and Sport England will continue to consult with their stakeholders in relation to various elements, such as engagement with members, culture, and diversity at board level. In particular, it is expected that the consultation will include the possibility of targets for British. Black, Asian, and minority ethnic members of Boards.
From a practical perspective, more sophisticated NGBs may find compliance with the GCS is easily accomplished; for the smaller NGBs, compliance may require greater expenditure of time, resource and expense. Conversely, it may be that smaller NGBs experience fewer organisational hurdles and will therefore be able to implement change more quickly, while some of the older juggernauts may find change more administratively challenging.
In any event, the GCS has not arrived without warning. Eligibility criteria and investment principles in UK Sport and Sport England’s previous funding cycle’s included a specific governance principle.
With increased public scrutiny of sport governance there is no better time for the UK to lead by example. While good governance cannot resolve every issue in sport, it is undoubtedly a good starting place. An organisation that embraces and embodies rigorous governance standards will be better able to safeguard its sport, and to detect, deter and deal with corruption.
Undoubtedly the GCS heralds a new era of sport governance in the UK. It will necessarily require NGBs and other sports organisations in the UK to question and build upon their governance standards, should they wish to continue to receive public funding. Provided adequate support is available to the NGBs and a suitable timeline for implementation is set out, the GCS could become the gold standard for sports governance on a global basis.