olympic games hosting and its ethical implications

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Olympic GamesHosting and its Ethical

Implications

2009

Joshua Riker-Fox

SGMA 575

12/24/2009



Table of Contents

Abstract ........................................................................................................................................... 3

Looking Back Before Looking Forward ............................................................................................ 4

A Global Game ................................................................................................................................ 6

The Olympic Games Odyssey ...................................................................................................... 6

The International Olympic Committee ....................................................................................... 7

The Bid Process ............................................................................................................................... 8

Consequence and Reciprocity ......................................................................................................... 9

Ethical Implications in the Selection of a Host .......................................................................... 10

Germany and China .............................................................................................................. 11

USSR and USA ....................................................................................................................... 12

Selection of the Host – Closing Thoughts ............................................................................. 15

Domestic Implications of a Games’ Hosting ............................................................................. 15

Effect on Host City ................................................................................................................ 16

Financial Consequences ........................................................................................................ 20

Closing Remarks ............................................................................................................................ 22

Appendix A – The Olympic Partner Program (TOP) ...................................................................... 24

Appendix B – The IOC’s Host City Selection Voting Procedure .................................................... 25

Appendix C – The Olympic Charter ............................................................................................... 26

Appendix D – List of Boycotting Nations for the 1980 Summer Olympic Games......................... 27

References .................................................................................................................................... 28



Abstract

As the Games’ evolves as a social spectacle of human behaviour, its commercial

character has simultaneously evolved into a phenomenon in its own right. The impression that

hosting a Games has on a city and nation is eminent and long-lasting, for a multitude of

reasons. Some are positive, while some are disastrously negative. The world witnessed student

protests at the 1968 Mexico Olympics result in bloodshed. Conversely, the 1988 Calgary

Olympics saw the positive influence hosting can have, as the city’s volunteers united to create a

legacy that is still celebrated today. The Games exist as a carefully intertwined mix of

international stakeholders, all with different objectives, but all affected by the quality of

product delivered during the 2 weeks that a Games takes place.

The rewards and repercussions of hosting the Olympic Games are both complex and

sensitive. National agendas, national pride, and the struggle for a place in the global environ are

central to the incentive for hosting. Yet, so much is at stake. Prospective host nations, its

citizens, and Olympic fans alike, must consider: is hosting an Olympic Games ethically sound?



Looking Back Before Looking Forward

If our Games are to be stopped every time the politicians violate the laws of

humanity, there will never be any international contests. Is it not better to

maintain and support the Olympic Games, one of the most priceless and

powerful instruments of our present civilization, and try to expand the fair

play and sportsmanship of the athletics field into other areas?1

As the flash of bullets began to fly at the group of students in Tlateloco, a section of

Mexico City, they must have wondered how protesting against an event that theoretically

prized fairness and equality would lead to the death of the colleagues surrounding them, or

perhaps their own. On October 2nd, 1968, the Mexican government clashed with roughly 10,000

student protesters. These individuals, frustrated with the Gustavo Diaz Ordaz presidency,

peacefully sought accountability for the government’s actions and in particular its future role as

the host of the 1968 Summer Olympic Games. Although the protesting group was also

composed of union groups, teachers, and peasants, each with a different agenda to

demonstrate against, the uniting theme was the upcoming Games. ‘Bread and circuses’ did not

represent a policy in the interest of the Mexican people, they reasoned. Ordaz responded to

the protest on the National Autonomous University of Mexico’s campus with an army

occupation order. With the Olympics-inspired protest as a pretext for the violence (and only 10

days from the Games’ opening ceremony), Ordaz’s army violently countered (Brewster &

Brewster, 2009). As author Elena Poniatowska (1991) accounts:

Flares suddenly appeared in the sky overhead and everyone automatically

looked up. The first shots were heard then. The crowd panicked… [and]

started running in all directions.

1IOC President Avery Brundage, 67

thsession, International Olympic Committee, 07/10/68.



Sunset approached and the attack began, leaving thousands beaten and between 200 and 300

individuals dead. Violence has existed throughout human history and across all cultures, yet in

this moment, why would the Olympic Games exist as an

impetus for such destruction? Perhaps Mexico was not an

appropriate host for the Games, and the IOC prematurely

selected a Latin American nation for the job.

As the Tlateloco massacre demonstrates, it is imperative

to understand the implications of hosting a Games and the

resonating effect it has on the host population. Yes, 1968 was

an exceptional period where protests were common

internationally, and revolutionary change had momentum.

Despite the severity of the incident, it portrays the degree of

power that the Olympic Games has to influence a society,

emphasizing the necessity to identify the real impact hosting

may have on a city and nation. To explore this, one must

consider a number of different factors. Each of which exists as

its own seemingly complex vacuum of conflicting values,

objectives, and incentives. First, the repercussions, both positive

and negative, that hosting a Games has historically had on a city

must be addressed. Second, a discussion is necessary on the

International Olympic Committee’s (IOC) role, and the image it

has historically demonstrated to the world. This refers to the ethical footprint left by the IOC

and Local Organizing Committee (LOC). Finally, and generally of the greatest concern, what

economic stimulus exists from hosting?

Brundage’s words, delivered less than a week following the Tlateloco massacre in

Mexico City, capture the essence of a broader question that the current paper seeks to answer:

Is hosting an Olympic Games ethically sound, with consideration to its immense economic cost,

its disruption and displacement to the local community (a direct and indirect repression), and

Figure 1. Student leaflets following Tlateloco

massacre. Brewster & Brewster 2009.



the halo effect associated to the IOC’s less than exemplar morality? In this evaluation, ethics is

considered primarily with regard to the consequences affecting the local population.

Ultimately, as this paper will demonstrate, hosting an Olympic Games typically, though

narrowly, provides a net benefit to the host city. But there are numerous transgressions and

casualties accepted in the process, making it a difficult venture to approve.

A Global Game

In order to explore the ethics debate inherent in hosting a Games, one must first

understand the pretext of the event itself and each stakeholders’ role.

The Olympic Games Odyssey

The original Olympic Games were an invention of the Greeks dating back to 776 BC.

Every four years, they were celebrated at Olympia in honour of Zeus. In 393, Roman Emperor

Theodosius banned them in favour of a more Christian agenda (rather than pagan). It was not

until the French Baron Pierre de Coubertin envisioned a global and uniting event that they

Olympic Games resumed (Pound, 2006). This was is 1896, in Athens. Coubertin believed that

physical fitness in combination with culture and education had the ability to improve society

and bring the world together. Prior to this, the primary means of societal interaction was war; a

both expensive and depressing cause. The first Games had only 12 nations and roughly 400

participants (Pound, 2006). However, his vision evolved into an event that now showcases

11,000 athletes from 204 nations (in its Summer version). With the exception of 1916, 1940,

and 1944, the Olympic Games has consistently been staged. The Games are truly a global event,

composed of not only international athletes, but also International Federations (i.e.

International Association of Athletics Federations, IAAF, etc.), and National Olympic

Committees (NOCs), Organizing Committees of the Olympic Games (OCOGs), and of particular

importance, international sponsors (TOP program). There are currently nine TOP sponsors for

the Vancouver 2010 and London 2012 Olympic Games. Of the nine partners, seven different

nations act as their headquarters further highlighting the international reach of the Games

(Coca Cola – USA, Acer – Taiwan, Atos Origin – France/Belgium, GE – USA, McDonald’s – USA,



Omega – Switzerland, Panasonic - Japan, Samsung – Korea, and VISA – USA). This

interdependent relationship amongst the IOC, IFs, NOCs, and TOP partners truly captures the

global workings of the Games and ultimately its basis as a revenue generating entity. It is likely

that few other business can claim the ‘international-ness’ that the Games provides as the

Olympic Movement includes every country on the planet, even those that are isolated such as

North Korea. Not even McDonalds can compete with that!

The International Olympic Committee

The International Olympic Committee is the “supreme authority of the Olympic

Movement” (International Olympic Committee, n.d.). It is a collection of “volunteers” selected

solely by the IOC. Its membership has been as high as 130 members, but a target of 115 has

recently been established. It consists of 15 Olympic athletes (elected by peers), 15 International

Federation representatives, 15 NOC representatives, and 70 members selected for their

personal characteristics (Pound, 2006). These last members’ terms are lifelong. The IOC

operates with a closed-door board of directors, where there are no requirements for public

disclosure. Simson and Jennings (1992, p. ix) described the IOC as “a secretive elite domain

where the decisions about sport [...] are taken behind closed doors, where money is spent on

creating fabulous life styles for a tiny circle of officials.” The intent of this paper is not to explore

the array of qualities and failings prevalent within the IOC. However, it is critical to appreciate

that the IOC’s values eventually trickle down to the product they endorse, which of course, is

the Games’ experience itself.

The Olympic Games is naturally clamoured with a variety of ethical debates as there are

so many stakeholders involved. For mega-events such as the Olympics, stakeholders are usually

classified into categories according to their roles – government, organizing committee, athletes,

media, participants, volunteers, and the local community (Xing, Church, O’Reilly, Pegoraro,

Nadeau, Schweinbenz, Heslop, Séguin, 2008). McNamee (2008) cites a lengthy list of such

ethical discussions. Is the celebration of the Games unacceptably chauvinistic? Should the

Paralympics be held prior to the Olympics to showcase these athletes rather than leave them as



an afterthought? Can politicians justify the opportunity cost to education, health, and welfare

budgets in preparing Olympic teams? A subject of considerable contention centres on the

ethics of hosting. Hosting has numerous topics oriented towards the ethic of the process. Is it

appropriate for a city to nominate itself? Is it acceptable that a nation endures significant

sacrifice in order to host successfully? And, has the IOC fulfilled its fiduciary duty to select the

most suitable host, irrespective of politics, favours, geographical rotation, and other external

factors?

The Bid Process

The incentive to host an Olympic Games exists in the bold and exclusive opportunity to

immortalize a city’s reputation, while potentially drawing impressive financial recompense.

Cities the world over, fiercely compete for the privilege. When Atlanta won the 1996 Summer

Olympic Games hosting right, the city rejoiced because the value to its businesses and citizens

was projected at US $3 billion (Kotler, Haider, & Rein, 1993). Hosting a Games attracts tourists

at grandiose levels, creates jobs while invigorating the city with new knowledgeable and skilled

individuals, fosters renewal, infrastructure and national pride, and draws on the TOP sponsors’

unique capabilities to the city’s benefit (Davis, 2008) (Appendix A).2

Naturally, more complex

reasons for hosting the Games extend beyond these. Rome (1960), Tokyo (1964), and Munich

(1972) wanted to demonstrate that they had rehabilitated since the Second World War. The

Moscow Games (1980) aimed to demonstrate the superiority of communism. The Seoul Games

(1988) represented a mixture of goals from beating Japan to further isolating North Korea

(Pound, 2006).

The potential economic, political, social, and technological gain from a successful bid

persuades numerous cities to enter the competitive process. Despite this, Olympic Games may

be a questionable investment to those who host them (Leeds, 2008). Kotler et al. (1993) term

2TOP – The Olympic Partner Programme.



this type of contest a “place war,” consistent with worldwide competition for businesses,

tourists, sports teams, and conventions. Cities contest the rigorous bid process every two years,

following a domestic decision on the most suitable host within the nation. Thousands of

individuals participate in each bid, and costs are easily in the millions of (US) dollars. In the

2000s, bid cities were required to pay a $100,000 application fee. A Candidature Procedure and

Questionnaire is then completed; a 260 page document. From this, a small grouping of cities is

selected as potential candidates, and each is required to pay $500,000 to continue with the

procedure. A city is distinguished as either an “applicant” city or “candidate” city depending on

what stage it is in, in the process. Cities are also required to guarantee $100 million in support

of their bid, and to sign indemnification agreements protecting the IOC and the NOC (Davis,

2008). Eventually a victor is selected via a voting process amongst the IOC’s 110-120 member

populace, seven years in advance of Games commencement (Appendix B). Naturally the

process is highly politicized and under relentless media scrutiny.

Upon winning the right to host a Games, the real work begins. Rio de Janeiro

successfully won the privilege for the 2016 Summer Olympic Games on October 2, 2009. This

will be the first South American host. Their struggle to win this contest was hotly contested,

with Chicago presenting a disappointing 4th

place bid endorsed by Barrack Obama, and Madrid

earning a respectable 2nd

place finish on the backs of previous IOC President Juan Antonia

Samaranch’s influence. Tokyo, Japan finished 3rd. Despite this, Rio’s true work lies ahead as it

prepares organizationally (security, volunteers, event management, transportation, and

tourism), infrastructural projects (roads, networks, power supply, technology, hotels, and

healthcare), and with respect to its venues (athletic venues, the Olympic Village, and

commercial sites); all with the hope to complete the seven year project having bettered Rio’s

current state (Davis, 2008).

Consequence and Reciprocity

From its inception in 1896, the Olympics has aspired to embrace two qualities: ethics

and internationalism (Pound, 2006). In reality the Games have been and continue to be highly



politicized, elitist, and commercialized. Although succeeding in its appeal for global inclusion,

one would sceptically agree that it has an acceptable ethical record. The paper posits that the

negative repercussions resulting from hosting most often arise when irresponsible decisions are

made by organizing committees and the IOC, and they become evident when various spheres

are scrutinized. However, unethical behaviour does not just simply and clearly appear, and is

thus not easily identifiable or preventable.

When one investigates the various contributing factors that impact the hosting of a

Games, two domains are most notable. First, what image is portrayed through the hosting

mechanism? Is the Games adhering to its Charter (Appendix C)? Are there conflicting agendas

present? This is critical as it identifies how the world will perceive the event. Second, what is

the broad effect on the city and its population? This requires a qualitative interpretation. And

likely of greatest importance is the financial after-effect. Does the city (and state and nation as

well) benefit economically from the enormous initial investment they make in order to host?

Ethical Implications in the Selection of a Host

Hosting a Games invokes the world’s attention on a community. This attention is both

critical and judgemental of the host city, and of the IOC’s selection of this city. A host city

should represent a beacon of positive ideals to the rest of the world. It must be capable

financially, logistically, and with respect to its infrastructure (Davis, 2008). And, the population

must deliver the Games with the same values that the IOC champions. The Games are a tool for

positive change; an opportunity to present the best of humanity.

Stakeholders must ask “Will staging the Games here contribute to the progression of

this culture’s quality of life?” Two opposing arguments are forwarded here. One will argue that

the privilege to host a Games must go to those who have strong rule of law, strong human

rights, and are financially able to deliver a fantastic product. The other side will argue that the

Games has the capacity to improve the rule of law, develop human rights, and increase financial

stability. One side prefers the stick, while the other, the carrot.



By selecting only those cities (and thereby nations) that meet a strict list of

requirements establishes a standard that the world will (theoretically) appreciate as projecting

the values that all human should have access to. This will encourage those nations that are not

meeting the standard to improve. However, others will argue that a great risk exists in

alienating many nations with a “western” palate of values that are not congruent with all

cultures. By alienating these nations, they may become isolated, and the ability to influence

them is forfeited. Historically, there are many instances where this dilemma has pervaded the

course of the Games or generated a surfeit of

scandal-rife analysis.

Germany and China

Those who adhere to the ‘carrot’ camp

note both Germany’s and China’s hosting as

indicators of how change can prevail from hosting

a Games. Germany’s hosting in 1936 was filled with

numerable inconsistencies with the IOC’s Charter.

Hitler viewed the Games as most state leaders do –

an opportunity to further a national agenda and

demonstrate its supremacy. He hoped that

Germany’s athletes would dominate the

competition. However, his contorted view extolled

Nazism. This was well known ahead of the Games and most agree that Semitism should play no

role in a celebration of humanity such as the Olympics. However, from this hosting, certain

heroes arose who embodied the true Olympic values such as Jesse Owens, who forced Hitler to

swallow his pride and accept (very briefly) that the Aryan Nation was not untouchable (Young,

2008). As Large (2007) notes:

Even the Nazis were unable to impose their ideology with impunity upon the

Games in Berlin. Rather, they were forced, however briefly, to appease the

Jesse Owens, 1936.



Olympic leaders and to conform (or appear to conform) to the internationalist

and inclusive ideals promoted by the IOC – ideals which even the latter itself

did not always follow that closely.

Jesse Owens won four gold medals and left Hitler “highly annoyed” (Speer, 1936, p. 73).

Interestingly, Large (2007) contends an association between Germany’s 1936 hosting

and that of communist China’s 2008 edition. Similarly, China sought a facelift through the

Olympic Games that would demonstrate its arrival as a superpower (Bonde, 2009). Just as

Tokyo in 1964 and Seoul in 1998 marked their emergence as major global players, so too would

Beijing (Sands, 2008). Many supporters of the ‘carrot’ concept cite China as a further example

of how a Games can bring positive change to a nation. Those will argue that overlooking some

of China’s shortcomings in favour of mobilizing broader change through hosting will lead to a

quicker and more robust development of human rights.

To many though, it appears counterintuitive that a one-party state with notorious

human rights abuses and ethnic boarder disputes, is given the right to fuel its cultural

propaganda through an Opening Ceremony at an Olympic Games (Bonde, 2009). In the seven

year lead up to the Games, leaders around the world admonished Beijing for its disparate

human rights record. Even Nicolas Sarkozy, France’s President, threatened to not attend the

event (Sands, 2008). Despite this attention or perhaps due to it, China hosted a successful

Games and many believe that regardless of China’s malfeasance, individual liberties have

progressed with the influx of such values. As Liu Jingmin, Executive Vice-President of the

Organizing Committee for the 2008 Beijing Olympic Games stated: ‘allowing Beijing to host the

Games will help the development of human rights’ (Bonde, 2009).

USSR and USA

Those affiliating with the ‘stick’ group will note the USSR (1980) and the USA (1998) as

illustrating the benefit in requiring an established and enforced standard of practices prior to



bestowing hosting rights on a city. Although in both these instances, human rights is not the

subject of examination, the corruption was similarly destructive in its own right.

The Summer Olympics of 1980 were extraordinary in storyline. The USSR passionately

felt that this Games was the opportunity to show the superiority of communism to the Western

world. Interestingly, the Soviet athletes did perform the best finishing well atop the medal

table. This was for two different reasons that detract from their supposed ‘superiority.’ First,

these Games were apparently the ‘cleanest’ of all time, as not a single doping infraction was

committed. Of course, this is a farce and the Organization Committee of the Olympic Games

had manipulated any effort to professionally test cheaters. More importantly though, the

USSR’s invasion of Afghanistan resulted in a global boycott of 61 nations to these Games led by

the USA (although Saudi Arabia was technically the first nation to refuse participation)

(Appendix D). In his State of the Union address of January 23, President Jimmy Carter

announced that he had “notified the Olympic Committee that with Soviet invading forces in

Afghanistan, neither the American people nor I will support sending an Olympic team to

Moscow” (Tristam, 2009).

This severely lowered the talent pool, giving the USSR a rather lop-sided competitive

environment. The boycott had both straining and humorous repercussions. This was

particularly disappointing for Canada, whose 211 qualified athletes were not eligible to attend.

It is an absolute shame when an athlete devotes their life to an endeavour and has it removed

for reasons that are extraneous to whom they are as competitor. On the lighter side, in the

women’s field hockey event, the boycott resulted in only one qualified team remaining – the

USSR. So teams were invited up to the week prior to fill the tableau (Vancouver Now, 2008).

The USSR was deeply threatened by the prospect of Western influence during the

Games, and instituted a number of strategies to ensure those values were not extended in the

Republic. Even though the corruptive persuasion of America and the 60 other boycotting

nations was nil, Soviet officials created various diversions to reduce potential influence. For

instance, children aged from seven to fifteen were sent away from Moscow on what was



officially regarded as a holiday to the countryside, so as to remain ideologically and culturally

pure (Vancouver Now, 2008).

The USSR’s invasion of Afghanistan highlights how critical it is to limit highly politicized

nations from hosting a Games. Moscow clearly had an agenda that was presented as a priority

over and above Olympic values. Their foreign policy was sufficient to crumble the integrity of

the Games as participation was drastically compromised. The IOC witnessed an aberration of

the Olympic values, widespread doping infractions, and a fragmented competitive field. And,

unlike in Nazi Germany or Communist China in 2008, the Games remained isolated and insular

so no tangible and broad change was discussed let alone arose from the USSR’s hosting.

Ideologies were maintained, the outside world remained perfunctory, and the IOC sanctioned a

sacrilegious event. The IOC had an opportunity to transfer the Games elsewhere or delay them

for a year (as was widely suggested). By doing so, it would have shown the world that the luxury

of hosting a Games is only privy to those who respect human rights. The IOC’s inattention to

the USSR’s deceit is akin to complicity.

The Salt Lake City bidding process witnessed Tom Welch and Dave Johnson, bid

committee leaders, bribe IOC delegates for votes (Crowther, 2002). The bribes included cash,

college scholarships, and other incentives. One of the IOC’s TOP sponsors (John Hancock -

President and CEO David D'Alessandro) verbalized the frustration held by all investors in the

Olympic Games (Wenn & Martin, 2006):

It seems to be the way the world works: every government that forgets about

the people who give it power and, instead, concentrates on keeping its

secrets, keeping its perks, maintaining its rituals and preserving its own hide,

eventually implodes. It happened to Louis XVI, and it happened to the Soviet

Communist Party. Now, it's happening to the International Olympic

Committee.

The Salt Lake City bid committee’s actions, although deplorable, actually exposed

behaviour that had long been present in the IOC’s selection of host cities. The brand value of



the Games and of Salt Lake itself was severely tarnished. The city’s name seems to be

accompanied by an asterisk reminding people that the city disingenuously won its hosting

rights. This is unfortunate for the city as its reputation is compromised, and it further calls to

question the ethical rational behind its bid, and future city’s aspirations to host a Games.

Selection of the Host – Closing Thoughts

This paper seeks to determine if hosting a Games remains an ethically sound endeavour.

Major partners in this are the IOC and the hosting city (and nation). As Berlin, Beijing, Moscow,

and Salt Lake City demonstrate, ethical transgressions are prevalent throughout the Games

process, both on the IOC’s part and on the organizing committees. The question is whether the

hosting, despite its inconsistencies and potential poor practices, results in an improved society

following the Games. Analysts like to point to different historical hosts as ‘proving’ that a

Games can or cannot be held without moral casualties. This is prevalent in all Games, and

especially in the four discussed here. However, upon evaluating the broad effect that most

often prevails, a Games hosting provides overall benefit to the host population. Human rights

were at the centre of the above discussion. It would be overly optimistic to suggest that the

Games were highly responsible for the post-Games developments that have occurred, but it is

notable that the Nazis’ were shamed in 1936, Beijing’s government was forced to open internet

access during the 2008 edition, the USSR crumbled only a few short years after its hosting, and

Salt Lake City bid committee’s actions resulted in a more transparent process for future bids.

Whether big, or small, it is arguable that each of these changes may have not yet occurred, or

would have taken significantly longer had the Games not been hosted in these locations.

Inherent in this (although a difficult pill to swallow), is the acceptance that ethical iniquity’s will

occur, but that in spite of them, good will prevail and ultimately a higher quality of life will

result.

Domestic Implications of a Games’ Hosting

Games’ hosting is of significant consequence to the city and its populace. The previous

section demonstrated a broad effect, largely fuelled by global factors, intrinsic in hosting. It is



evident, through the historical analysis, that the motivation to host is often predicated on

similar dynamics. More deeply, there is a layer of consequence touching the local populace that

is worthy of further investigation. There are a host of risk-laden ‘unknowns’ during the Games.

The host city may be peripherally affected by the quality of the competition, the extent of

doping infractions, the potential for a judging scandal, or even the weather. Numerous risk

factors will establish if the Games (and ultimately the host) is perceived as a success or a failure.

The list is lengthy, yet organizers must focus on the elements for which they have a degree of

control. Implicit in this is the multitude of changes a city experiences (and is obligated to) in

order to meet IOC requirements. A second aspect, and of incredible significance, is the financial

aftermath that the host city commits itself to. While considering these two elements, it is

sought to determine if hosting an Olympic Games remains ethically acceptable to the local

population, given its micro-level impression?

Effect on Host City

Games have a formidable affect on host cities and nations. Consider Vancouver today, in

the final months prior to Canada’s hosting. Vancouver progressed from the idyllic modern

miracle: a controversy-free, efficient, and financially solvent Games, to a protest-plagued

(world poverty, seal hunting opposition, treatment of First Nations people, etc.) and recession-

rattled Games (The Economist, 2009). Local support for hosting the Games is generally

considered a prerequisite for IOC approval, though this has rarely been measured through

formal means (Xing et al., 2008). In open, democratic societies, there will always be groups

challenging the presence of the Games. And, in many cases, their assertions are warranted.

This impact on this city is not unique. In fact, Parent (2008) lists thirteen distinct issues

that event organizing committees face: politics, visibility, financial, organising, relationships,

operations, sport, infrastructure, human resources, media, interdependence, participation, and

legacy. This places significant responsibility on the organizing committee. And, as much as the

event organizers (i.e. Vancouver Organizing Committee – VANOC) are concerned with how the

event can be capitalized upon to promote the city, event owners (i.e. IOC) seek organizers who



will safeguard and enhance the brand equity of their event (Xing et al., 2008). This is quite

challenging for organizers as they must please local residents while also meeting the IOC’s

stringent standards.

An assortment of issues are central to the effect on a host city. Here, we discuss three of

them; relationship building with other partners, displacement of locals, and the innate

intangibles of hosting.

Relationship Building

Relationship building is an interesting component of the Games as there is impressive

opportunity to develop long term, fruitful associations with other nations as trading partners.

There is a economic incentive with this, but there are further benefits, akin to the initial

progression towards bilateral trade agreements. Beyond gaining access to better pricing on

certain goods, nations also procure products that perhaps were not accessible before. Jaffe and

Nebenzahl (1993) found that the 1988 Seoul Olympic Games in South Korea positively

influenced Israeli perceptions of and willingness to purchase South Korean products for those

with high exposure to the Olympics. This is a pertinent finding as Israeli consumers formed a

more favourable image of South Korea after exposure to the Seoul Olympics. Conversely,

France’s perception and relations with China soured immensely due to the Beijing Games. Xing

et al. (2008) found that perceived human rights violations in China could influence beliefs about

the social responsibility of the Beijing Olympics. France, more than any other nation,

demonstrated against China’s human rights abuses and its treatment of Tibet. As such, China’s

travel agencies informally retaliated by suspending French packages (de Beer, 2008). A further

boycott targeted L’Oreal, Louis Vuitton, and other French goods. Naturally this apprehension

was reciprocated, and the overall relationship is still being salvaged more than a year later.

Beijing’s hosting fuelled a number of international campaigns to boycott Chinese products.

Naturally, host nations want to form trading relationships and not strain them as a result of

organizing a Games. Fortunately for China, the world’s demand for their products is so

immense, that a haphazard embargo will hardly raise eyebrows, let alone be a meaningful



impetus for change. Not all nations have the unique positioning of China’s though. The Israel-

Korea, and France-China events highlight the delicate nature of Games hosting and relationship

building. There is tremendous risk in this pursuit (and tremendous potential upside), which

identifies the ethical dilemma. If hosting has the counter-productive risk to sour foreign

relations, is it in the best interest of the city and nation to do so?

It is worth noting that the above relationship is bi-directional between the event and the

host place. So, consumers may transfer their negative perception of Beijing’s policies, to the

Games itself. Consumers are then likely to transfer negative perception of the Games to a

negative perception of the Games’ TOP partners. This is of considerable consequence to the

sponsorship partners, who are a invaluable stakeholder for the Games operations (Xing and

Chalip, 2006).

Displacement of Locals

Most Olympic Games require a movement of local businesses and residents in order to

accommodate the appropriate infrastructure. It is a near impossibility to host a Games in a

metropolis (the only cities capable of hosting major Games) and not move existing structures.

This is only justifiable if those affected are compensated fairly. What is fair is difficult to

determine. In any case, we can be assured that most often, those individuals are not

remunerated well, as their voice is overshadowed by Olympic inertia. Consider this, according

to the Geneva-based Centre on Housing Rights and Evictions (COHRE); 2.75 million Chinese

citizens were displaced to make way for Olympic-related construction. And, a total of 512,100

houses had been removed since the city was awarded the Games in 2001. COHRE states that

most Chinese citizens were given little or no warning before they were evicted from their

homes and were not compensated for their land. The Chinese government disputes these

figures and says all owners have been compensated (Zurlo, 2007).

Displacement does not only occur in less developed nations such as China, as evidenced

by Vancouver and its downtown eastside. This is Canada’s poorest zip code, suffering from

chronic homelessness, drug use, and prostitution. Amid the excitement for the Games,



momentum towards rejuvenation and gentrification has increased. Mayor Sam Sullivan has

identified cleaning up this area as an Olympic legacy. Yet, by addressing the lower eastside’s

problem, he will simply be transferring it elsewhere. Affordable housing advocates fear further

displacement in a city that already has Canada’s highest housing prices (Baker, 2008). The city

has allocated a number of low-income housing projects, although some of these have been

reduced resulting in severe criticism of the city’s planning.

The Intangibles Inherent in Hosting

The final micro-level factor discussed is the intangibles of hosting. Generally, the impact

of an event is evaluated under three distinct areas: direct financial impact (i.e. job creation to

build facilities), indirect financial impacts (i.e. Long term tourism gain), and intangibles (i.e.

Development of a city’s brand). Too often, Games are primarily evaluated on their financial

merits while avoiding the discussion of intangible elements. Beijing claims a $146 million

operating profit from the Beijing Games, but does the financial result accurately portray the

qualitative impact on the city (Burton & Falk, 2009)? Financial performance is important and

discussed later, but it is imperative to understand the intangible components in order to make

an accurate assessment of the ethical suitability in hosting.

It is an unenviable task to try to compare the resulting intangibles with the economic cost,

and determine whether a net benefit or loss occured. Intangible components include economic

development (beyond direct revenue and expense of Games itself), branding, volunteer

training, facility legacies, health care improvements, and the lengthy list continues. These are

long term aspects that cannot easily be accounted for, but which are extremely critical as

Burton & Falk (2009) note by asking the question “Was it more important for the Games to

showcase China’s growing economy and tourism/branding than to improve the quality of life

for Beijing residents?”

It is clear that a Games is not meeting its ethical obligations if legacy vehicles are not

central to its application. However, applications must focus on profitibility in order to appease

local citizens. It is dangerous political ground to suggest a Games will perform otherwise, even if



accompanied with legacy benefits, as these benefits are generally difficult to identify and

measure accurately. The IOC increasingly expects applicant city’s packages to identify legacy

aspects within its proposal. Whether these aspects are genuine and sustainable projects is

discussion for further research. Post-Games evaluations should not focus soley on costs, but on

the holistic impression. Burton and Falk (2009) argue that these aspects need to be evaluated

with appopriate metrics, clear benchmarks, and long-term data collections (and done so

independently). When a city is prepared to do this, and in fact does while demonstrating net

positive progress, it may be deemed as an ethically sound host.

Financial Consequences

The Olympic Games are not only grand sporting arenas promoting the Olympic spirit,

but also great platforms for cities to promote themselves to improve their image for long term

economic gain (Li & Blake, 2009). A primary incentive in hosting the Games is the supposed

financial gain that the city will derive. In terms of tourism, a positive image of a host destination

may pull both international and national travellers to visit (McManus, 1999). Interestingly,

some evidence suggests that a spill over effect may have a more predominant affect on those

communities surrounding the host, rather than the host itself. Leeds (2008) found that the 2002

Salt Lake City Olympics actually provided limited financial gain for the local community (and

Utah), but actually benefited 16 Colorado counties that had ski resorts. Of course, there are

plenty of benefits implied beyond tourism. Each city hosting the Olympics wants to show its

citizens (or government) the pomp and circumstance did not cost anyone anything (Burton &

Falk, 2009). Proponents of hosting will often cite supposed economic benefits. Hefner (1990)

discussed how the construction of Olympic venues can profit an economy. Investing in venues

increases the demand for capital and labour in the construction industry, as well as increasing

the demand for building materials, which encourages further productivity and employment in

industries that manufacture building materials.

Critics note a number of negative financial factors resulting from hosting though. First,

opportunity costs are high given that the money spent on Olympic venues could be spent on



other public needs, such as reducing poverty, and improving health and education, which may

be of greater benefit to the economy. Second, public investment may cause a crowding out

effect out on private investment when public funding is involved in Olympic venue

construction. Third, if Olympic venues remain idle post-Games, but maintenance costs are still

incurred, construction of these venues is a cost rather than benefit t to the economy (Li &

Blake, 2009). It is evident that a Games can quite easily be more expensive than forecasted and

that the original intended objective of bettering the society may be lost in the process.

A look at the upcoming Games in Vancouver and London highlights this risk. The

Vancouver 2010 Games garnered a 64 percent approval rating amongst its citizens in 2003, but

is now being scrutinized for a budget shortfall of approximately US $87 million, and a further

request for US $20 million to support Olympic Village construction. The IOC has announced it

will help with Vancouver’s debts should a deficit result. This a rare position for the IOC to take,

but at the same time, raises fears for moral hazard, if VANOC (Vancouver Organizing

Committee) does not remain conservative in its spending. In London, experts are predicting a

US $160 million shortfall in the London Development Agency’s 2012 Olympics account (Burton

& Falk, 2009). Table One exhibits the historic profitability levels of seven Olympiads. The data

must be cautiously interpreted as it is not always clear what stakeholder is responsible for what

debt (tax payers vs. organizing committee). A general picture is painted however.

Table 1. General Cost of Recent Olympic Games (Davis, 2008)

City (Year) Bid Cost Games Cost (US) Results

Barcelona (1992) $ 10 million $ 10.7 billion $ 6.1 billion loss (public debt)

Albertville (1992) $ 2-3 million $ 2 billion $ 57 million loss

Lillehammer (1994) $ 3 million $ 1.6 billion $ 40 – 50 million profit

Atlanta (1996) $ 7 million $ 1.7 billion Broke even

Nagano (1998) $ 11 million $ 14 billion $ 28 million profit of OCOG$ 11 billion loss (public debt)

Sydney (2000) $ 12.6 million $ 3.24 billion Broke even

Salt Lake (2002) $ 7.0 million $ 1.3 billion $ 100 million profit

Montreal (1976) was a disastrous Games financially, leaving a billion dollar debt that the

city was responsible for. This experience and numerous others suggest that a Games cannot be



ethically justified. The financial implication is just too great. However, as some Games have

demonstrated (and more typically, recent events), denying a city’s public the immense

opportunity for the unique economic stimulation a successful edition can bring would be

ethically futile as well. In terms of financial repercussions, it is not yet clear if hosting a Games

can be ethically justified; given its immense cost and its effect of reducing funding to other

areas that may better serve the population. What can be confirmed is that if a city should host,

it must be conservative in its pursuit or risk a catastrophic inheritance left behind, such as

Montreal’s in 1976.

Closing Remarks

The Games are a spectacular event, drawing remarkable attention to host cities. Many

factors influence the process, affecting whether it is a success or failure. The discussion of

justifying the event is premised on the extent to which a city’s population will be better off for

assuming this immense responsibility. A successful Games has the capacity to distinguish a host

city as a marquee destination for years to come. But a failed Games is not only an

embarrassment, it also saddles its citizens with a burden that may too endure for years to

come. It is not only financial factors that are central to the discussion, but further implications

such as the displacement of locals, how the bid was won, what the hosts’ intentions are, and

the long term international relationships that are forged. Naturally, the financial implications

are a central factor in the equation though. But cities must delve deeper than this to

understand how their city will be reshaped following the Games. The challenge of unexpected

cost overruns from construction, immense operating budgets and mounting media scrutiny as

the Games approach, is common. But, when the Games cost billions to stage and then result in

a modest profit or a healthy loss, the citizens of hosting cities deserve some form of

independent audit that considers all aspects (Burton & Falk, 2009).

Given the potential for the Olympic Games to transform a city in terms of infrastructure,

developed financial relationships, and overall vibrancy, it is difficult to argue against hosting.

Maintaining an ethically sound Games is truly challenging however as so many stakeholders are



implicated. Fortunately, history has shown a number of Olympic Games that were not fuelled

by the right means, but never-the-less resulted in an improved state. This usually stems from

international attention on domestic imbalances that would not otherwise be discussed in the

media globally. Ultimately, this is the power of the Games. Games hosting remains an ethically

justifiable venture because a net positive influence most often results from the project. Despite

the risk inherent in its immense economic cost, its disruption of the local community, and the

questionable behaviour of many of its stakeholders (IOC, organizing committee, sponsors, and

even athletes), the Olympic Games has a tremendous ability to improve, or minimally initiate

the discussion on how a society’s population can improve, through hosting the event. Given

that the IOC was recently granted UN Observer Status for its contribution to the Millennium

Development Goals, one would be further inclined to believe that the IOC’s operations will

continue to improve with respect to its ethics practices and its ability to ensure future Games as

a whole are more ethically-sound (Taume News, 2009). The Olympiad is an incredible

celebration with the potential to act as a vehicle for change. Although laden with complicating

factors, the Olympic Games most often has a positive return on investment for its host

community and is ethically justified due to this ability to affect change.



Appendix A – The Olympic Partner Program (TOP)

The TOP programme was initiated in 1988 for the Calgary (winter) and Seoul (summer)

Olympiads. According to the IOC:

The Olympic Partner (TOP) programme is the highest level of Olympic

sponsorship and provides sponsors with exclusive worldwide marketing rights

to both the Summer and Winter Games.

TOP Partner companies are multinational organisations which are able to

provide direct support, sponsor services or expertise for the staging of the

Games. In addition to supporting the IOC and the Organising Committees, TOP

Partners support National Olympic Committees and their Olympic teams.

The worldwide Olympic Partner Programme is managed and negotiated by

the International Olympic Committee (International Olympic Committee -

Sponsorship, n.d.).

Table 2. The Olympic Partner Programme (Davis, 2008)

Quadrennial Games Partners NOCs Revenue

1985 - 1988 Calgary/Seoul 9 159 US $96 million

1989 - 1992 Albertville/Barcelona 12 169 US $172 million

1993 – 1996 Lillehammer/Atlanta 10 197 US $279 million

1997 – 2000 Nagano/Sydney 11 199 US $579 million

2001 – 2004 Salt Lake City/Athens 11 202 US $663 million

2005 - 2008 Turin/Beijing 12 205 US $866 million



Appendix B – The IOC’s Host City Selection Voting Procedure

The eligible IOC members will then be asked to vote. In each round; each participating IOC

member may vote for only one city. The votes of members not taking part in a round of voting

or who abstain, as well as blank or spoilt electronic voting entries, are not taken into account in

the calculation of the required majority. If, after the first round of voting, no city obtains the

absolute majority of the votes cast, as many rounds are held as necessary for a city to obtain

such majority. The city receiving the least number of votes leaves the competition. The name of

the city is made public straight away and the vote continues. If only two cities remain in

contention, the one that obtains the greatest number of votes is declared elected. The

announcement of the winning city is then communicated by the IOC President at the

announcement ceremony, following which, the newly elected NOC and city will sign the Host

City Contract.

International Olympic Committee



Appendix C – The Olympic Charter

• To encourage and support the promotion of ethics in sport as well as education of youth

through sport and to dedicate its efforts to ensuring that, in sport, the spirit of fair play

prevails and violence is banned;• To encourage and support the organisation, development and coordination of sport and

sports competitions;

• To ensure the regular celebration of the Olympic Games;

• To cooperate with the competent public or private organisations and authorities in the

endeavour to place sport at the service of humanity and thereby to promote peace;

• To take action in order to strengthen the unity and to protect the independence of the

Olympic Movement;

• To act against any form of discrimination affecting the Olympic Movement;

• To encourage and support the promotion of women in sport at all levels and in all

structures with a view to implementing the principle of equality of men and women;

• To lead the fight against doping in sport;• To encourage and support measures protecting the health of athletes;

• To oppose any political or commercial abuse of sport and athletes;

• To encourage and support the efforts of sports organisations and public authorities to

provide for the social and professional future of athletes;

• To encourage and support the development of sport for all;

• To encourage and support a responsible concern for environmental issues, to promote

sustainable development in sport and to require that the Olympic Games are held

accordingly;

• To promote a positive legacy from the Olympic Games to the host cities and host

countries;• To encourage and support initiatives blending sport with culture and education;

• To encourage and support the activities of the International Olympic Academy (IOA) and

other institutions which dedicate themselves to Olympic education.

International Olympic Committee



Appendix D – List of Boycotting Nations for the 1980 Summer Olympic Games

Albania South KoreaAntigua and Barbuda LiberiaArgentina Liechtenstein

Bahamas MalawiBahrain MalaysiaBangladesh MauritaniaBarbados MonacoBelize MoroccoBermuda Netherlands AntillesBolivia NigerCanada NorwayCayman Islands PakistanCentral African Republic PanamaChad Papua New GuineaChile Paraguay

People's Republic of China PhilippinesCôte d'Ivoire Saudi ArabiaEgypt SingaporeEl Salvador SomaliaFiji SudanGabon SwazilandGambia ThailandWest Germany TogoGhana TunisiaHaiti TurkeyHonduras United Arab EmiratesHong Kong United States

Indonesia UruguayIsrael U.S. Virgin IslandsJapan Zaire



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