How Extensive is Collusion Involving Organizing Committee and Corporations?

Another scandal involving an alleged case of systemic misconduct linked to the world’s largest sporting event has come to light. How deep is the cozy relationship between the organizing committee and the corporations responsible for the projects?

In a bid-rigging incident linked to the Tokyo Olympics and Paralympics in 2021, the special investigation squad of the Tokyo District Public Prosecutors Office has arrested a former deputy executive director of the organizing committee’s event operations bureau and three others, including a former executive at advertising giant Dentsu Inc., on suspicion of violating the Antimonopoly Law involving unreasonable restraint of trade.

In 2018, a bidding process was conducted by the organizing committee for 26 contracts, including for planning work for test events to assess how to run competitions and security in preparation for the Games. As a result, nine companies, including Dentsu, and one joint venture won bids totaling about ¥500 million.

However, prior to the bidding process, the four arrested allegedly arranged the winning bidders by finding out which contracts each entity wanted to get. The successful bidders subsequently signed negotiated contracts with the organizing committee for the operation of the test events and the Games, with the contracts amounting to around ¥40 billion in total.

Based on this, the special investigation squad may have judged that the suspects selected the successful bidders from the planning stage of the test events with the intention that they would also get to operate the Games.

A senior member of the organizing committee, whose officials were considered to be quasi civil servants under the law, working together with companies to undermine the bidding process would be an inconceivable situation.

The organizing committee included many staff members seconded from Dentsu. Hakuhodo Inc. and ADK Holdings Inc. are other major advertising firms that are also believed to have been involved in the scandal. It must be said that there could be a problem with the culture in the advertising industry, which descended upon the Games, attracted by the huge funds involved.

A former executive board member of the organizing committee who was a former Dentsu employee has been indicted on charges of accepting bribes totaling nearly ¥200 million from companies to help them get selected as Games sponsors.

The Games were held by overcoming challenges amid the novel coronavirus pandemic. Japan won 58 medals at the Olympics, including 27 gold, and 51 medals at the Paralympics. Athletes and others who worked so hard for so long must feel betrayed due to the repeated revelations of scandals.

The string of scandals has also cast a shadow over the bid to host the 2030 Winter Games in Sapporo. The International Olympic Committee had been scheduled to select the host venue this autumn, but it has postponed the decision. The Sapporo municipal government said it will conduct a survey to ask its citizens and others whether they are for or against holding the Games in the city.

The commercialization of the Olympics, in which large sums of funds are raised from corporations, has existed for a long time. The Tokyo Games in 2021 raised a record of just over ¥370 billion from 68 domestic sponsor companies.

It will be difficult to gain understanding from the public over future bids to host the Games unless there is a review of the business-oriented nature of the event and assurances about the transparency of sponsor selections and project details.

(From The Yomiuri Shimbun, Feb. 9, 2023)