Feb. 7 (Bloomberg) -- Soccer governing body FIFA ditched bonuses for its executive board, a group that’s come under scrutiny in recent years because of several corruption cases.
The FIFA Executive Committee, responsible for approving billions of dollars’ worth of television and sponsorship agreements, is made up of 25 officials from six continents.
Domenico Scala, appointed head of a new audit and compliance body in 2012, said executives agreed to scrap the bonuses after he argued that they created a risk of unethical behavior. FIFA, a not-for-profit organization, doesn’t publish compensation details. In its 2012 financial report FIFA said it paid $33.5 million to “key management personnel,” who included the executive board and finance committee.
“FIFA’s executive committee is an oversight and decision-making body, they are not responsible for sales,” Scala said in a telephone interview. “From a governance perspective we don’t want to provide a bonus to people overseeing the operations.”
The officials don’t have employment contracts that specify bonuses so they can’t appeal the change. The bonuses were awarded by FIFA President Sepp Blatter based on the organization’s financial performance. FIFA makes more than $1 billion a year, largely through selling rights related to its quadrennial World Cup, which takes place this year in Brazil.
Scala declined to say how much the bonuses were worth, only describing them as “significant.”
The organization was forced to enact reforms in 2011 after several officials were sanctioned for wrongdoing.
They included Mohamed Bin Hammam, a FIFA vice-president and the former head of Asian soccer, who was accused of offering $1 million to officials in the Caribbean to support his bid to unseat Blatter.
Two board members were also suspended in 2010 after they were taped agreeing to sell their votes for World Cup staging rights to undercover reporters. Most recently, FIFA last year reported that its ex-president Joao Havelange and his former son-in-law Ricardo Teixeira, previously head of Brazilian soccer, improperly accepted payments from FIFA’s marketing partner ISL in exchange for broadcast rights to the 2002 and 2006 World Cups.
FIFA has resisted calls to publish details of executive pay, including that of its president. Between 2008 and 2012 payment to key personnel grew by 81 percent, according to the organization’s financial statements.
“The bonus should be provided to the individuals making the money, not those who are judging their performances,” Scala said.
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