Should I accept your sponsorship?
How human rights due diligence can help organisations with sponsorship dilemmas
by Clara Philippi and Leonel Lisboa
What is the issue?
This summer, the world’s attention has been focused on sport: from the European Football Championships to the Olympic Games in Paris, fans have been glued to their screens, celebrating amazing feats of athleticism and sportspersonship. And it’s precisely this attention that can be a goldmine for businesses looking to promote their brands. Many major companies, including Coca Cola, Samsung, Alipay, and Unilever, make use of this golden opportunity – through corporate sponsorship of these events.
At the same time, we are witnessing a powerful shift in the discourse around corporate human rights due diligence. Thanks in part to new legislations, such as the Corporate Sustainability Due Diligence Directive (CSDDD) and Corporate Sustainability Reporting Directive (CSRD), many businesses are placing a much greater focus on improving their human rights due diligence processes. If companies are scrutinising their supply chains for human rights compliance, why aren’t we equally vigilant about who funds our major sporting events?
Why is this important?
Organising bodies rely on sponsors to make these events possible and to provide for both the athletes and the millions of workers in supporting industries. However, by accepting money for advertising space, they also provide a platform for powerful organisations that may be linked to human rights abuses.
Although sports event organisers are typically non-profit entities and are not subject to mandatory human rights due diligence legislation such as the CSDDD, their revenues can far exceed those of many companies that are regulated by these laws. For example, the International Olympic Committee (IOC) earned $7.6 billion between 2017 and 2020/2021, compared to Levi Strauss Co.’s annual revenue of $6 billion in 2023.
Given the financial position of such sports organisations and their potential to significantly impact human rights through their operations, we at Löning advocate the application of the UN Guiding Principles on Business and Human Rights (UNGPs) to sports organisations. The UNGPs provide crucial guidance by emphasising accountability not only for direct human rights impacts, but also for those impacts to which an organisation is indirectly linked or has contributed. Thus, even a seemingly innocuous act such as accepting sponsorship money can create a direct link between a sports organisation and human rights abuses. Giving visibility to those who perpetrate such abuses through sponsorship can even contribute to the occurrence of adverse human rights impacts.
Even UNGP author John Ruggie [1], in a report on the International Federation of Association Football (FIFA), recognised the position of sports organisations when it comes to potential human rights impacts. He urged FIFA to address the significant human rights risks associated with its global activities and to use its influence to mitigate these risks as vigorously as it pursues commercial interests; this balancing act should also apply to the sponsorship dilemma.
What can be done?
The overarching vision of the International Olympic Committee (IOC) is to “build a better world through sport”; one of Union of European Football Associations’ (UEFA) top strategic priorities is to pursue “a culture of sustainability”. This includes using their powerful position to raise awareness of the issue. Undertaking human rights due diligence in the selection of its sponsors would be a logical and necessary step to ensure adherence to such values and goals.
Sports organisations should use their immense power as gatekeepers to some of the world’s most widely watched television events to demand access to high quality, transparent information on the human rights impacts of potential sponsors.
What might human rights due diligence (HRDD) look like in such a context?
Implementing HRDD in this context means that when choosing partners, major sports institutions, such as the IOC and the UEFA, have a responsibility to their employees, athletes and a global audience of billions of people. This responsibility requires that, thorough vetting processes, these institutions ensure that their sponsorships are aligned with their values and do not support human rights abuses in their value chains.
Sports organisations should be proactive in their attempts to understand how their activities impact human rights by integrating this understanding into their governance and risk management processes.
According to the Institute for Human Rights and Business (IHRB), sports organisations should adopt four key governance steps to promote the values of sport and respect human rights, in line with best practice and international standards such as the UNGPs:
- Make a public commitment to respect human rights and embed this commitment in their organisational culture, standards and practices.
- Identify and prioritise actual and potential human rights risks, focusing on the most serious ones.
- Take appropriate action to address these risks and, where necessary, provide remedies.
- Communicate and report on how they manage and mitigate human rights risks. [2]
Löning – Human Rights & Responsible Business specialises in human rights due diligence across a variety of industries and can provide expert guidance to sports bodies in implementing these steps.
[1] “For the Game. For the World. FIFA & Human Rights” (2016) https://www.hks.harvard.edu/sites/default/files/centers/mrcbg/programs/cri/files/Ruggie_humanrightsFIFA_reportApril2016.pdf
[2]“Championing Human Rights in the Governance of Sports Bodies” (March 2018) https://www.ihrb.org/uploads/reports/Championing_Human_Rights_in_the_Governance_of_Sports_Bodies%2C_MSE_Platform.pdf
