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Latest Crises May Finally
Mean Change for U.S.O.C.
Amid the lush gardens and the replicas of Greek statuary at
a museum near Montgomery, Ala., called Jasmine Hill,
officials of the United States Olympic Committee and some
of the organization's most important corporate sponsors
gathered in August to discuss their entwined futures.
After Anthony T. Ponturo, the vice president for sports
marketing of Anheuser-Busch, finished a presentation, Lloyd
Ward, the Olympic committee's chief executive, rose and,
smilingly broadly, asked Ponturo, "What can we do for you?"
Ponturo quickly replied, "Stay out of the newspapers."
Seldom has less heed been paid to advice from a powerful
sponsor. Over the last month alone, the bitter infighting
among members of the Olympic committee's senior board and
staff has produced a cascade of headlines concerning
conflicts of interest, resignations, factional battles and
possible no-confidence votes.
The organization's executive committee determined that Ward
had acted in a way that gave the appearance of a conflict
of interest.
Five Olympic officials, including the ethics officer,
resigned in protest, saying that the committee had failed
to take strong action against Ward. Then last week, the
Olympic committee's president, Marty Mankamyer, stepped
down after a month of pressure from five vice presidents
and two other top officials, a period of crisis that
culminated after it was revealed that she may have also
violated the organization's ethics code.
The turmoil has been deeply embarrassing to the Olympic
committee, but the long-term consequences could be much
more serious. There is growing concern that corporate
sponsors may become reluctant to continue to spend millions
for athletes' training, that the bid by New York City to
play host to the 2012 Summer Games may be undermined and
that the Olympic committee may find it hard to attract
top-notch executive talent.
To stave off those possibilities, several United States
senators have begun talking about the need to pare the
Olympic committee's organizational structure. There is
talk, too, of imposing more stringent federal oversight of
the Olympic committee. The organization's executive
committee, meeting over the weekend in Chicago, voted to
deny Ward the $184,800 bonus he had earned for 2002.
"This is a national embarrassment to us and to the Olympic
movement," said John MacAloon, an Olympic historian at the
University of Chicago. Referring to Dr. Jacques Rogge, the
president of the International Olympic Committee, MacAloon
added, "Mr. Rogge has said he only wants the U.S.O.C. to
fix itself, but they have been going through this for 20
years: the absence of trustworthy, reliable management."
Senator Ben Nighthorse Campbell, Republican of Colorado, is
eager to overhaul the organization, whose actions, he said,
"make me sick to my stomach."
A member of the United States Olympic judo team in 1964,
Campbell said he wanted to see headlines only about
competing athletes, not warring executives. "I don't want
to pick up the paper and read about another fight,"
Campbell said, "unless it's in the boxing ring."
It appears very likely that the Olympic committee's
unwieldy structure - a 123-member board of directors and a
21-member executive committee - will be changed. But many
people in the Olympic movement question whether a
reorganization will, by itself, ensure stable management or
leaders who can work cooperatively and understand how to
avoid conflicts of interest.
The latest round of conflict with the Olympic committee
began with the ethics investigation into Ward, who was
found to have violated the committee's ethics code when he
directed a staff member to help his brother and a friend,
who were seeking a $4.6 million contract to provide backup
power to the Pan American Games, which will be held in the
Dominican Republic this summer.
The executive committee determined that Ward had created
only an appearance of a conflict of interest. That decision
provoked the resignations of five Olympic officials. It
also led indirectly to the resignation of Mankamyer, the
committee's president, after it was revealed last week that
she had accepted part of a real estate agent's commission
from a purchase of property by Ward, even though she had no
role in the transaction.
Many people in Congress and around the country now seem
convinced of the need to change how the organization is
operated.
"It should have been done before, and now we've created a
crisis to create change," said Bill Stapleton, a vice
president of the Olympic committee and the leader of the
anti-Mankamyer campaign.
Ways to Restructure
Among the likely changes are trimming the 123-member board
to 20 or fewer members, and reducing the powerful executive
committee, with 21 members, to fewer than 10. The roles of
the president, who is a volunteer, and the chief executive,
who is the senior paid executive, may be defined more
clearly.
Over the past two decades, presidents and chief executives
of the Olympic committee have often been in conflict,
squabbling over everything from who will speak to the news
media to who will oversee international relations.
"There has never been a bright line that says this is the
responsibility of paid staff and this is the responsibility
of volunteer staff," said Richard D. Schultz, who served as
executive director from 1995 until 2000. The title was then
changed to chief executive and the position's powers were
expanded.
But Schultz's replacement, Norm Blake, who was accustomed
to a corporate environment that allowed him to decide
matters swiftly and decisively, floundered when he offended
volunteers with his blunt approach to cutting costs and
staff. Blake left after eight months, in October 2000.
A year later, Ward was named chief executive, and his
relationship with Sandra Baldwin, who was then the
president and who supported his selection, was not
friction-filled. But Baldwin resigned in May after
acknowledging that she had lied on her resumé about her
academic credentials.
Mankamyer replaced Baldwin, and she and Ward quickly became
adversaries, especially after Ward declined to resign in
the fall from the Augusta National Golf Club because of its
all-male membership. Mankamyer had wanted him to leave the
club because it discriminated against women, Olympic
officials said.
"You didn't see the acrimony at executive committee
meetings," said Patrick Rodgers, the Olympic committee's
ethics officer who stepped down last month. "But you
noticed they didn't speak."
How much a major change in governance will alter the
organization's inbred culture is difficult to gauge, nor
will it guarantee that the most qualified, most ethical
people will be attracted to leadership positions.
Anita DeFrantz, a bronze medalist in rowing at the 1976
Summer Olympics who is a member of the United States and
International Olympic Committees, said: "To paraphrase
George McGovern during the Watergate hearings: good laws
are important, but even more important are good people. Can
we attract a Bill Gates? I don't think we can afford him."
Donna de Varona, a two-time gold medalist in swimming at
the 1964 Summer Olympics, said: "You're always held captive
to your leadership and who you bring in. It's still a roll
of the dice."
A change in the size of the board and the executive
committee may reduce the number of constituencies fighting
for attention and money. But more important, many critics
of the Olympic committee say, is the need for government
oversight of the organization's operations and finances,
which have expanded drastically over the past two decades.
The harshest critic among Olympic sponsors is David F.
D'Alessandro, the chairman of John Hancock Financial
Services, who recently demanded an accounting of how
sponsors' money was spent.
In essence, the Olympic committee is a nonprofit
organization whose prime function is raising money. It has
political and international roles, and a headquarters staff
of about 500, but it exists primarily to distribute money
from the public, sponsors and television to the national
sports governing bodies, which spend the money on athletes.
"There is a cancerous tumor within the U.S.O.C., and it's
not just about governance and people," D'Alessandro said.
"It has to do with the way it brings in and spends money,
and how it's incredibly dependent for more than 50 percent
of its revenues from the I.O.C."
Many have said that more direct and continual Congressional
oversight is required. In the past, such regulation was
rejected, but now, with the ethics crisis coming after the
organization's failures in the Salt Lake City bidding
scandal, there is greater sentiment to find a forceful,
permanent way to make the Olympic committee more
accountable.
"Virtually every other country has a minister or
subminister cabinet position for sport, which introduces a
discipline where a cabinet ministry is continuously dealing
with the Olympic committee," MacAloon, the Olympic
historian, said. "Without it, problems remain and fester.
The challenge is for Congress to find a proportionate
American solution that can't be a weak, `Oh, send us a
report' kind of oversight."
The Trickle-Down Effect
In gyms and weight rooms across the country, Olympic-level
athletes are weighing the fallout from the Olympic
committee's troubles. A trickle-down effect is feared, one
that is damaging not only to the size and the number of
sponsorships, but also to the image of the Olympic
movement.
"I hope the public understands we have nothing to do with
it," said Steven Lopez of Houston, a gold medalist in
taekwondo at the 2000 Olympics in Sydney, Australia. "A lot
of people come to me asking about all this stuff, and I
say: `That's at the top. I'm just down here training as
hard as I can day after day.' If anything, the people at
the top are supposed to be watching our backs.
"But I know if the sponsors are reading the same papers I'm
reading, you have to wonder what they are thinking. The
Athens Olympics are just around the corner. This is when
sponsorship deals get done. I haven't felt an effect yet,
but what if this continues?"
Others have already seen an impact on sponsorship dollars
and in requests for public appearances at the corporate
level - a common way for Olympic athletes to supplement
their incomes to pay for training. Evan Morgenstein is the
agent for more than 50 Olympians, from swimmers to
bobsledders.
"This has been a nightmare for us," Morgenstein said. "The
Olympic movement is turning into the laughingstock of the
sports marketing world. Everything is on hold. Many Olympic
sponsors won't sign on right now. What would be the point?
If you had a press conference or a satellite meeting, there
is nothing you could do in the media that would outshine
this circus going on.
"This can't continue, because if you anger enough of the
public, it is so easy to turn the Olympic movement into
something inconsequential."
Shane Hamman is among the world's top weight lifters and an
American Olympian from the Sydney Games. "As athletes we're
pretty focused on our training, but you do hope everything
will be cleared up soon," Hamman said. "We're all worried
about the sponsorships. That's a lifeblood."
De Varona, the two-time gold medalist, noted that in the
midst of the organizational uproar, American Olympians have
been performing well this winter in international skiing
and skating. But can that level of achievement be sustained
in a climate of chaos?
Joe Umphenour, a triathlete from Bellevue, Wash., trains at
least six hours a day, six days a week while living at the
Olympic committee's dormitory complex in Colorado Springs.
While he does not dwell on each news development, he has
become wary.
"If things get worse and if the sponsors decide to pull
back," Umphenour said, "that's when we'll feel the
trickle-down effect. They mean everything to us and if we
don't have support, we're not going to get the medals."
Tracy Mattes, a pentathlete from Wisconsin, longs for more
representative guidance from the Olympic committee's power
structure.
"I still think, on the whole, the Olympic image is great,"
Mattes said. "Unfortunately, a few individuals have created
a controversy that has hurt everyone. The disappointing
thing is that, as athletes, we're doing everything we can
to be the best in the world. And we expect the same of our
leadership, too. One Olympic ideal should fit all."
With 18 months until the 2004 Summer Games, many sponsors
are hoping that the current crisis will fade and that the
public will continue to separate the unsightly executive
problems from the athletic events in Greece and beyond.
With sponsors paid up through Athens, the goal for the
U.S.O.C. is to persuade them to re-enlist through 2008.
"Major sponsors know it's about the athletes and the
Games," said Philip Guarascio, a consultant, who, when he
worked for General Motors, negotiated a long-term
sponsorship with the Olympic committee that expires in
2008.
The sponsors' contracts include escape clauses, which were
added after the Salt Lake City bidding scandal. Those
clauses let sponsors out if U.S.O.C. actions create
"offense, outrage, ridicule and contempt" among a
substantial segment of the public.
The continuing danger is whether its current crisis and
management problems will reduce the willingness of sponsors
and the public to help finance the Olympic committee. So
far, sponsorship sales of nearly $60 million for the period
from 2005 to 2008 far exceed the pace four years ago.
Still, one lost donation was Jasmine Hill, where U.S.O.C.
officials and sponsors met in August. Jim Inscoe, president
of the Jasmine Hill Foundation, wanted to donate the
property to be used as an academy to teach Olympic values
and ethics. But last month, Inscoe withdrew his offer
because of inattention from Ward and the Olympic
committee's executive difficulties.
"Everywhere you turn, they have ethical problems," Inscoe
said. "They can't do what is good and fine and wonderful
for the Olympics."
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