By Osasu Obayiuwana in Cairo, Egypt
July 9 – As the Confederation of African Football (CAF) is engulfed by governance problems that could, unbelievably, lead to FIFA’s direct intervention in its day-to-day affairs, its poor image could have an immediate and long-term impact on its financial future, as sponsors are increasingly uncomfortable with the negative publicity surrounding the body.
A source close to French company Lagardere, CAF’s marketing partners, tells Insideworldfootball that the recent allegations of corruption and unethical conduct, involving high-ranking members of the organisation, is going down very badly with key sponsors, particularly VISA, the financial services company.
“It has been very difficult for a lot of sponsorship deals to be effectively activated for this Africa Cup of Nations. It cannot be argued that companies do not want to be actively involved with a brand that continues to have very negative headlines in the media,” the source told Insideworldfootball.
“There is no way that the African football brand can be sold if it’s seen as toxic. The political infighting within the organisation is having, and will continue to have, a very serious effect on Lagardere’s ability to obtain new sponsors and even activate existing ones, if the governance problems within the organisation are not resolved very soon,” he went on.
“It has been very difficult to get VISA, which is one of the major sponsors of CAF, to commit funds to activate its sponsorship of the AFCON.
“They are clearly not happy with the recent news surrounding the arrest of CAF officials and the allegations of money laundering and tax evasion. It’s hard for a marketer to function in this atmosphere,” he said.
Lagardere’s 12-year deal with CAF, which runs from 2017 to 2028 – but was concluded in June 2015 – compels them to pay a guaranteed $1 billion in income to the continental body.
The contract gives the French company the right “to commercialise the marketing and media rights of the main regional football competitions in Africa, including the Africa Cup of Nations, African Nations Championship and [the] African Champions League,” Lagardere said, on signing the deal whilst Cameroonian Issa Hayatou was still CAF President.
Total, the Oil Company, which is the single biggest sponsor of CAF, is said to have a clause in their contract that allows them to unilaterally pull out of their deal with CAF, without financial penalties, should CAF be involved in acts of reputational damage that could reflect badly on sponsors.
“There is certainly a clause that allows Total to pull out of their deal with CAF, with no obligation to pay a further penny. So, it is important that CAF doesn’t push its sponsors into taking drastic steps. They need to get their house in order.”
Total and CAF signed their eight-year deal in 2016, becoming the title sponsor of 10 CAF competitions, which started with the 2017 Cup of Nations in Gabon.
CAF has struggled to do a deal with a major sports equipment manufacturer for the last four years, since Adidas ended its contract with them in 2016.
This forced CAF to purchase its equipment on the open market, leading to the major controversy surrounding its relationship with French company Tactical Steel, which sourced equipment on its behalf.
Allegations of money laundering and tax evasion, concerning the business dealings between both organisations, led to France’s Central Office for Combatting Corruption, Financial and Tax Crimes, OCLIFF, questioning CAF President Ahmad and Loïc Gerand, his executive assistant, for several hours in Paris on June 6.
The pair were released without any charges, while OCLIFF investigations are said to be continuing.
It was at this time that FIFA confirmed that its Investigatory Ethics Chamber is looking into allegations of unethical conduct made against Ahmad.
Contact the writer of this story, Osasu Obayiuwana, at moc.l1563368696labto1563368696ofdlr1563368696owedi1563368696sni@o1563368696fni1563368696