Case Study: Salt Lake City Olympic Fribery Scandal Essay

This case study focuses on the bribery scandal surrounding the city selection process for the 2002 Olympics held in Salt Lake City, Utah, USA. The student is ask to discuss the merits of the case based on three parameters, ethical behavior, the impact of culture, and the bid process from a broad based business point of view. They are also ask to speculate as to their actions if they were particular individuals associated with the chain of events.

CASE DISCUSSION Questions 1 & 2 combined

Primary responsibility for the Salt Lake City Olympics bribery scandal should rest with the International Olympic committee. Failure to develop and implement an ethical audit and consistent selection processes for Olympic venues created the opportunity for ethical scandal. Although the IOC created and implemented the Hodler Rules, gifts documented as “souvenirs” were never defined. Gifts could reasonably be presentations of $1000 Browning Field Rifles or Sony Video Cams. These tokens avoided the $150 rule as “samples”. Furthermore, no standard was defined and set for travel issues, entertainment, or transportation. This created the opportunity for $80,000 weekly suites.

Clearly the Hodler rules appear written as a response to demands of propriety while allowing for “situational ethical” valuation of individual IOC members to voting activities. The concept of situational ethics gained recognition in the 60’s through the work of Episcopal minister Joseph Fletcher. Fletcher responded to popular philosophy proposing that the requirements of an individual situation should supersede an absolute standard. (Fletcher, 1963) In our case the special situation might be the need to evaluate the ability of a city to provide appropriate athletic and cultural support for the Olympics. This view is contradictory to the view of moral unity. Kant wrote about the categorical imperative of moral unity. As a philosophy, moral unity supports a viewpoint where the IOC should not have allowed the opportunity for disparate treatment of cities based on “gifts” to members. Any unique individual treatment would contradict a universal law of right and fairness to which no exceptions or special situations exist (Edgar, 1999).

The Salt Lake City Olympic committee assumes less responsibility. Operating in a thirty-year environment of situational ethics, their members responded with rationalizations seemingly common in corporate ethical mismanagement. Committee members approached winning the Olympics as a competitive “game”. Providing expensive gifts and travel was not illegal according to IOC policy and certainly within the game “rules” as played during the previous Nagano Olympics. Also present was the justification learned in the LA games that the costs of committee actions, $3.7 million, justified the expected gains of $2.8 billion, 23,000 job years of employment and about $100 million in tax revenues after costs. Clearly the ends seemed to justify the means.

SLOC members also seemed justified given the known results of similar actions in Nagano. Finally, SLOC members supported both their organization mission and culture in their actions. As an organization mission they were trusted to win the support of the IOC for Salt Lake City. In contrast the IOC mission of fair sportsmanship should have been to find the best facilities for Olympic athletes and stakeholders at a fair price. By allowing the influence of bribes, stakeholders cannot have faith that the IOC achieved its mission.

The IOC holds additional responsibility as the “keeper” of the Olympic brand, identity and sportsman’s code of ethics and honor. When IOC actions were questioned by corporate sponsors delaying payment, the brand of the Olympic Rings was not enhanced. The rings represent a tradition of good sportsmanship, fair play, and teamwork; essential values in athletics. Arlene Gorton, conference chair of Fair Play or Foul Ball, and international symposium directed at sports ethics and held at Brown University, holds the opinion that “sports play a major role in teaching society social values which the nation believes are important. Values taught by sports involving ethics are much more than following the rules”. (Gorton, 1999)

The response of the IOC investigative commission also reinforces this primary responsibility. The commission findings support a culturally relevant approach to ethics. Although bribes were not illegal, the quid pro quo of jobs and support to relatives indicates an attempt to persuade votes. Within cultural relativism all beliefs are equally valid, truth is relative depending on the situation, environment, and the individual. Beliefs are part of the cultural identity (Glazer, 1994). In the IOC investigated incidents, previous years of accepted bribery, the privilege of royal titles and luxuries, created an environment where questionable actions appeared normal and acceptable. In addition, the individuals involved clearly expected, and had, life times of similar treatment without question, an example being “His Excellency” Samaranch. Finally, the power inherent in a situation where a vote can grant billions to a city risking millions in a campaign provides a situation where bribery can thrive.

Also relevant are the cultural values of the U.S. Olympic committee and a religiously conservative city such as Salt Lake City Utah. These environments contributed to the opportunity for scandal. U.S. competitive values stem from a history of literature where individual winners are heroes have pulled out from adversity by their bootstraps. In the Wild West anything goes. Salt Lake City, a conservative Mormon community, also has a history of independent religious thought exercising a moral superiority that ignores the federal laws in the practice of polygamy and child welfare. Upon this type of historical background it becomes easier to justify a “small” bribe for a huge group “win” of the Olympic Games (Holt, 2003).

Individuals also operated not only with cultural relativism, but also from frameworks of developing countries with unique prevailing values. For example, if the primary value of the African tribe focuses on group good, it would seem reasonable that the value of group good would extend to accepting donations for charitable foundations, scholarships for poorer countrymen and women, and also jobs with higher economic returns.

Regardless of the situation or culture, actions of both the IOC and SLOC were ethically wrong. The environment, situation, and culture all contributed to this scandal. Neither organization, however, experienced circumstances of incapacity, which might have made these actions ethical. The costs of behavior in both organizations were not unrealistically high or preventable given the situation. Costs were high but avoidable. Both organizations had the power of influence over the situation.

The IOC had the decision authority. The SOLC had the thirty-year mandate and supporting budget to initiate bribes and “win” the games. Both organizations had alternatives. The IOC could easily have chosen another venue based on “real” criteria such as existing facilities, road infrastructure, available employment, and sportsmanship, not “false” criteria of nifty gift fur coats. Lastly, although external forces influenced decision-making and budgets, the SOLC was not compelled at all costs to win the games and nothing seemed to affect the ability of IOC committee members to accept gifts.

If values are relative to a given culture no universal absolutes exist for which the behavior of humans may be judged. Rules right or wrong would be a matter of opinion. Following this argument no moral objection would be made to the seven bombings and innocent deaths July 6, 2005 in London. Bombings would be acceptable as a response to a situation where England’s support of the war in Iraq kills innocent Muslims. Also, a Moslem culture which supports a hero’s death as a martyr also creates a situation and environment where innocent deaths and violent means seem justified. (Rosado, 2003, pg. 5) in this instance the ethical weakness of cultural relativism excuses us from judging the moral status of other cultures when actions seem inappropriate.

As the IOC and SOLC along with corporate sponsors develop a solution to this ethical issue distinguish between the philosophical ethical theories and the social implications of possible solutions. In Taylor’s model for creating knowledge he discusses both empirical knowledge and evaluative knowledge. Ideologies, or beliefs based in the way the world should be can be both empirical and evaluative (Steiner, 2003). Science, or the belief that all knowledge reflects its actual operations in the world is generally not evaluative nor is logic which explores the reasoning behind calculations. Finally, Religions create beliefs in supernatural forces. Social solutions to ethical dilemmas will work when the solution understands and matches the basis for knowledge creation relative to the culture. (Rosado, 2003)


The Salt Lake City and IOC scandal provides a lesson for future behavior improvement. For any corporation or organization both the situation and culture of the group are critical in evaluating the possibility for unethical behavior. Confidence in both the brand and the integrity of the organization provide additional revenue opportunities and confidence in the service and products. To paraphrase economist Milton Friedman “the only acceptable corporate responsibility is the enhancement of revenues that will allow higher profits back to shareholders, who may then reinvest according to their individual values”. (Arguments from Dead Economists)