By Andrew Warshaw
November 25 – Sony Corporation will not be renewing its top-tier $280 million FIFA sponsorship which ends December 31, according to Japanese reports. After the loss of Emirates Airlines as a sponsor last month FIFA had said that it was in “ongoing talks with Sony” over renewal of their eight year deal. Now it seems those talks have ended.
The Japanese consumer electronics group, which is one of six FIFA top-tier sponsors, announced last month that it will pay no dividend for its current financial year, for the first time since its shares were listed in 1958, the year of Brazil’s first World Cup victory.
The announcement coincided with the disclosure that the company expects to report a net loss of Y230 billion ($2.1 billion) for the year to end-March 2015, more than four times the previous forecast. The revision is the result entirely of a Y180 billion ($1.6 billion) impairment charge in its mobile communications division.
Although Japan’s Nikkei business daily said Sony had made the decision for cost-cutting reasons rather than anything to do with FIFA’s reputation, the move comes at a difficult time for FIFA as it struggles to repair image damage as a result of the ongoing disputes connected with the World Cup bidding investigation.
Earlier this month, FIFA’s ethics judge Hans-Joachim Eckert said there were no grounds to reopen the case, clearing 2022 and 2018 hosts Qatar and Russia of wrongdoing that would have compromised the integrity of the vote. But that announcement was immediately undermined when Michael Garcia, the former U.S. prosecutor who led the investigation, disputed Eckert’s summary of his findings.
Garcia and Eckert met face to face last week and decided to send the report to the chairman of FIFA’s audit and compliance committee, Domenico Scala, who will in turn decide how much of it to submit to the FIFA executive committee. The pair also confirmed that the ethics committee had opened a number of formal cases against unidentified individuals. FIFA has also referred individual cases to the Swiss authorities for further investigation.
Sony has been an official sponsor of football’s global governing body at more than 40 tournaments, including the 2010 World Cup in South Africa and this year in Brazil.
Emirates’ contract was due to come to an end in 2014 anyway, but the company recently put out a statement saying the decision not to renew was made “following an evaluation of FIFA’s contract proposal which did not meet Emirates’ expectations.”
FIFA relies on its commercial partners for about 35% of its revenue and will have taken note of Coca-Cola’ statement at the weekend saying: “Anything that detracts from the mission and ideals of the FIFA World Cup is a concern for us. The current conflicting perspectives regarding the investigation are disappointing. Our expectation is that this will be resolved quickly in a transparent and efficient manner.”
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