Commentary

U.S. Soccer and governing in the 21st century



As U.S. Soccer has grown into a $100 million business with a huge influence on the sport, both domestically and internationally, how it approaches business relationships and develops standards of good governance becomes increasingly important.

U.S. Soccer doesn't just train and field national teams and develop programs for the development of the sport at the youth and adult levels, it is also deeply involved in the business side of the sport.

The Copa Centenario -- for which U.S. Soccer is budgeted to receive an extraordinary fee of $15 million for running the tournament -- would not have happened if U.S. Soccer had not stepped in and organized the tournament following the arrests of key Conmebol and Concacaf figures in 2015. It has operated the NWSL, a full-blown women's pro league, since its launch in 2013.

U.S. Soccer's broadcast rights for national team games (men and women) are bundled with those of Major League Soccer and sold by SUM, which also sells integrated marketing partnerships on behalf of U.S. Soccer.

U.S. Soccer has been far ahead of the game, compared to FIFA, in many of its governance areas, notably the appointment of independent directors (like Donna E. Shalala, the president of the Clinton Foundation) to its board.

But Roger Pielke Jr., the founder and chairperson of the Sports Governance Center in the Department of Athletics at the University of Colorado, has published a report at Soccernomics in which he recommends three steps U.S. Soccer should take related to conflict of interest policies to bring them, as he writes, "into the 21st century."

Pielke writes that U.S. Soccer reviewed drafts of his proposals and U.S. Soccer president Sunil Gulati was supportive, saying, “We’re happy to get better!”

The three areas of concern:

1. How U.S. Soccer evaluates actual or potential conflicts of interest.

They must currently be disclosed to CEO Daniel Flynn or Gulati. A risk, audit and compliance committee helps with dealing with issues that arise.

Pielke suggests U.S. Soccer needs to have an independent body review these cases at arms' length, pointing to an independent ethics committee like what USA Track & Field has an example.

2. How U.S. Soccer's business relationships operate and how business and non-profit activities function under the same umbrella.

Pielke argues that U.S. Soccer must conduct an independent review of U.S. Soccer's business relationships with MLS and SUM and create separate business and non-profit functions under completely different organizations.

He notes that this will be strongly resisted by all parties but adds that "the mixing of business interests and non-profit sports governance is a recipe for disaster, as we have seen repeatedly in the soccer world in recent years."

What makes this problematic, Pielke says, is that U.S. Soccer currently exempts from its conflict of interest policy “any constituent or affiliated member entities."

3. How U.S. Soccer communicates its conflict of interest policies to its members and the public.

Pielke says U.S. Soccer needs to improve its transparency and publish information on its conflict of interest policies and procedures.

U.S. Soccer does have an Integrity Hotline, where parties can report potential ethics or integrity violations or suspected or wrongful acts of conduct by U.S. Soccer representatives.
8 comments about "U.S. Soccer and governing in the 21st century".
  1. R2 Dad, December 6, 2016 at 11:41 p.m.

    Could this be related to the fact that US Soccer delayed their reclassifying divisions? It must have occurred to US Soccer at some point that being tied to hip with MLS leaves them with a less-than-objective perspective on this whole issue of divisional structure. Whoda thunkit!

  2. Bill Wilson, December 7, 2016 at 10:09 a.m.

    R2 Dad, this article was probably not tied to complicated only at the MLS/SUM/US Soccer relationship. You are right in pointing out that it does provide a less-than-objective slant on the divisional structure than would exist in a perfect world. It is, however, not a perfect world and there doesn't seem to be some other entity willing to provide untold millions of dollars to move soccer forward in the US....except MLS (and USL to a certain extent) owners. So what is your point?

  3. Gus Keri, December 7, 2016 at 10:47 a.m.

    I don't think US soccer is worried about the reclassification of divisions. NASL was unreasonable in requesting division I status when its own survival is not guaranteed. And changing criteria for division I status is required in view of the tremendous growth of the game in the USA.

  4. aaron dutch, December 7, 2016 at 4:32 p.m.

    So how does this play out in the USSF vs. SUM vs MLS shell game? Where is all the $$ going and to do what.

  5. Quarterback TD, December 7, 2016 at 5:01 p.m.

    US Soccer is too monopolistic why does an organization need to control what is going on from youth level to PRO ? The MLS, USL and all the other leagues need to run independently. Even for sports that USA dominates like Basketball the USBA doesn't get involve with organization in day to day crap with organization like NBA and certainly not youth sports.. We spend a lot of money on a bunch of failed groups, coaches and systems because we are too big to manage--

  6. R2 Dad replied, December 7, 2016 at 7:20 p.m.

    As always, it's about the money. MLS gets $100M for each new franchise. There are currently 20 teams, and Garber has suggested there could be 28-40 by the time they are done. So that is $800M to $2B in fees. So this gusher of cash that Garber has must make it's way back to Sunil at some point. Now you can see why these guys never retire, and why corruption is endemic to soccer. And that's just the up-front cash. The annuity that MLS wants is the training compensation & solidarity payments. MLS is a single entity--they write all the player contracts, touch everything, have their hands in every pocket. Mike W wrote about it here: http://www.socceramerica.com/article/69475/the-cases-for-and-against-compensating-youth-clubs.html ....and what it means is that MLS wants to claim all training compensation and solidarity payments for all players grown in the US (though it is up in the air what will really happen). MLS right now is too small to make that case, but if there are 40 teams, all with associated DA teams/US eventually MLS COULD reasonably claim they should get the whole pile of cash. MLS is trying to avoid that until it gets large enough to have a legitimate claim, with any precedent in the mean time ruining their grab for EVERYTHING in the US. This is enabled by the monopoly Sunil/US Soccer/US court system allows Garber to have. It's easy for me to say it should all be blown up because it's easier to tear down something than build it up. But follow the money. There is always a reason the boss retires with a $10M golden parachute. We're talking about Sepp Blatter being a crook, but inevitably our own federation will come under increasing suspicion as to where all this money is going and what we are getting in exchange. So far, MLS is doing well, while the youth soccer system in this country still sucks for all the reasons repeated on these threads.

  7. aaron dutch, December 8, 2016 at 10:28 a.m.

    R2, MLS gets $200-400 for a new franchise now and they get to add another $20m a year in sponsorships, licensing, rights, fees, etc.. Plus the SUM pass thru keeps the $$ and the shell game.

  8. Heather Dobrott, March 4, 2017 at 8:58 p.m.

    I fully expect US Soccer to carefully investigate my report and clean up the obvious corruption, by-law violations and harassment in North Texas State Soccer. NTSSA is a disaster!

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