Investors in adidas "are increasingly worried that the FIFA corruption scandal risks tarnishing the German sportswear brand after the company declined to join other major sponsors and demand the immediate departure of President Sepp Blatter," according to Jörn Poltz of REUTERS. Coca-Cola Co., McDonald's, Visa and Budweiser-owner Anheuser-Busch InBev last week "made a coordinated push for Blatter to quit after Swiss authorities opened a criminal investigation into him." Adidas, which has provided the World Cup match ball since '70 and extended its partnership with FIFA until '30 two years ago, stuck to earlier comments calling for FIFA to "implement fundamental changes for the sake of football." Ingo Speich, fund manager at Union Investment, which owns a 0.75% stake in adidas, "is concerned." Speich: "If you finance a corrupt system, the brand will suffer. This is a glaring risk for adidas. Consumer boycotts, fines or pressure from regulators could be the result." Adidas said that "it has no intention of ditching FIFA in the next few years given its extended contract, but will consider how influential this kind of partnership is to its target consumer when it does come up for renewal." The Deutsche Schutzvereinigung fuer Wertpapierbesitz, Germany's largest association for private investors, said that adidas "should do more to speak out." DSW VP Daniela Bergdolt said, "It casts adidas in a bad light. Adidas should put more pressure on FIFA. ... As a sponsor, adidas has very considerable weight." However, others believe adidas "is well advised to keep a low profile" given the importance of football to its business. Hill+Knowlton Strategies sports marketing expert Andy Sutherden said, "At the end of the day, there is still a huge commercial upside in being involved in the World Cup." An industry insider said, "Adidas could not afford to boycott FIFA. The means of exerting pressure are limited" (REUTERS, 10/7).
