Much has been written lately about the International Olympic Committee (IOC)’s finances. Some of these commentaries have revealed a profound misunderstanding of the global body and its mission.
Lana Haddad, IOC COO (IOC/Greg Martin)The IOC is a values-based, not-for-profit organisation dedicated to building a better world through sport. It does this through the Olympic Games, which are the only event that brings together the entire world in the spirit of peaceful competition. The IOC uses its revenues to support the long-term development of athletes and sport worldwide – from the grassroots to the top of the pyramid – and for the benefit of everyone playing sport: children, junior athletes, grass-roots athletes, amateur athletes, elite athletes, professional athletes and Paralympic athletes. They all benefit from it in one way or another.
Solidarity in its widest possible sense
The entire structure of the Olympic Movement is built on the model of solidarity in its widest possible sense, and is based on revenue-sharing. Ninety per cent of the IOC’s revenues, USD 5 billion in the last Olympiad or the equivalent of USD 3.4 million per day, is redistributed. These investments go towards supporting the hosts of the Olympic Games (USD 2.5 billion in the last Olympiad) as well as the development of athletes and sport at all levels around the world. Through its model, the IOC directly supports 40 Olympic sports and their International Federations (IFs) and other sports organisations around the globe, as well as 206 National Olympic Committees (NOCs), through which it disburses team grants and individual athlete scholarships.
After all, even Olympic champions have to start somewhere. This is especially important in countries where other imperatives mean that investment in sport may not be a priority. In some countries, NOCs and national sports federations rely almost solely on support from the IOC, without which they would struggle to develop sport or nurture athletes and send them to international competitions.
Olympic Games organised on a for-profit business model would be very different
This values-based, not-for profit solidarity model is not at all comparable to the for-profit business model of professional leagues. Their revenue generation and distribution are based on maximising returns, and generally benefit one sport in one country. This is not by any means a criticism of such models, but we have to acknowledge that this is simply a very different route.
Imagine if the IOC were to organise the Olympic Games on a for-profit business model. The event would be limited to those sports that generate the most significant revenues, and it would not involve athletes representing teams from 206 countries. It would not be Olympic Games as we know them. Yet, it is precisely the tremendous range of sports and the global provenance of the athletes that distinguish the Olympic Games from other events and make them so successful. The Olympic Games are the only event that brings the entire world together in peaceful competition.
Athletes are part of a team, and teams participate in the commercial success of the Games
It is also worth remembering that athletes compete at the Olympic Games as part of a team: that of their NOC. Since what goes around comes around, it is these teams that participate in the commercial success of the Games. So, by supporting the NOCs and the IFs, the IOC is supporting the athletes.
This model, which is part of the DNA of the Olympic Movement, received clear endorsement at the International Athletes’ Forum held in Lausanne in April last year. Among the key recommendations athletes brought to the table was an explicit appeal to strengthen the solidarity funding model.
The Athletes’ Forum also made the recommendation, which was reinforced by the Olympic Summit in December 2019, that IFs and NOCs should make transparent how they support their athletes, both directly and indirectly, including through anti-doping efforts, medical assistance, harassment and abuse prevention, career programmes and coaching.
Collective bargaining would mean pitching athletes and sports against each other
The IOC wants to support athletes, through the existing system, to the best of its abilities. Athletes are at the core of everything the IOC does. But athletes are not employed by the IOC and should not be considered workers in the same way as they are in professional leagues. Therefore, the recent renewed calls for direct payments to athletes are disturbing. If the IOC were to do that, it would result in increased inequity and would benefit fewer individuals.
The not-for-profit model means the IOC is not able to remunerate athletes directly. But let’s imagine, even if the IOC were able to do so, and had to enter into collective bargaining for athletes to be compensated by the IOC for their participation at the Games. This would mean calculating the commercial value proposition of each athlete, team and sport. It would not be simple maths: the IOC could not just divide X million dollars by 11,000 athletes for the Olympic Games and by 3,000 athletes for the Olympic Winter Games. Take the professional leagues and clubs: the value of each team and each athlete is not the same, and they are all compensated differently.
Suddenly, athletes qualified for the Olympic Games would be pitched against those who have not qualified; athletes competing in one sport would be pitched against athletes competing in another sport; current competitors would be pitched against future and past generations of athletes. If some athletes got more, others would get less.
This is not at all in line with the mission of the IOC and does not represent the Olympic values. The solidarity model would be broken. The majority of athletes would not benefit.
Further, due to the diversion of funds, global sports development initiatives like the IOC’s Refugee Olympic Team would suffer. The IOC would not be able to maintain its current level of support for the hosting of the Olympic Games, which provide the platform for Olympians to showcase their performance in front of a global media audience. It is unlikely that athletes would be able to benefit from the same level of basic services such as free transport, food, accommodation and medical facilities at the Olympic Games, to mention but a few.
For international events other than the Olympic Games, many athletes would have to dig deep into their own pockets to make their way to championships and cover their basic expenses.
Those who would suffer most would be athletes from developing countries, and even many from developed countries.
By contrast, the Olympic revenue-sharing model ensures that all Olympic sports and all Olympic teams, from all countries, can benefit. That is why we call it the solidarity model and will continue to advocate for it.
The solidarity model is more important than ever in this unprecedented crisis
And now that the world is facing an unprecedented crisis, this model and the role of the IOC are more important than ever. IFs and NOCs are turning to the IOC for support. Without the risk management framework put in place over the last few decades to build up reserves and secure the financial security and independence of the IOC, it would not be in a position to support the survival of the stakeholders of the Olympic Movement and, through them, offer continuous support to the athletes.
The IOC will not go down the track of defining this support to athletes as a cold-hearted cost-benefit analysis, pitching athletes against athletes and sports against sports. The IOC stands in solidarity with all athletes and all sports.