Major Olympics Sponsors Stay Quiet On China Ahead Of Beijing Games

Sponsors are protecting their $1 billion investment in the upcoming Bejing Winter Olympics by not commenting on China's human rights issues.
Staff members rehearse a victory ceremony at the Beijing Medals Plaza of the Winter Olympics.
Posted at 1:31 PM, Jan 12, 2022

The Beijing Winter Olympics are fraught with potential hazards for major sponsors, who are trying to remain quiet about China's human rights record while protecting at least $1 billion they've collectively paid to the IOC.

That could reach $2 billion when new figures are expected this year. Sponsors include big household names like Coca-Cola, Procter & Gamble, Visa, Toyota, Airbnb, and Panasonic.

The International Olympic Committee's so-called TOP sponsors are being squeezed by a diplomatic boycott led by the United States, the economic power of 1.4 billion Chinese — and the fear of retaliation by China's authoritarian government.

China, itself, was part of a full-fledged boycott of the 1980 Moscow Olympics.

"They (sponsors) are trying to walk a fine line between trying to get the best exposure, but also not trying to be perceived as too close to the actions of the Chinese government," Mark Conrad, who teaches sports law and ethics at Fordham University's Gabelli School of Business, said in an email.

The IOC created the strain by returning to a country whose rights abuses were well documented in the runup to the 2008 Beijing Summer Olympics. They now rival the pandemic for attention with the Winter Games opening on Feb. 4.

The rights violations committed against Muslim Uyghurs and other minorities clash with the lofty principles in the Olympic Charter. The Charter speaks of putting "sport at the service of the harmonious development of humankind, with a view to promoting a peaceful society concerned with the preservation of human dignity."

It further adds: "The enjoyment of the rights and freedoms set forth in this Olympic Charter shall be secured without discrimination of any kind, such as race, color, sex, sexual orientation, language, religion, political or other opinion, national or social origin, property, birth or other status."

The Associated Press contacted most of the major Olympic sponsors, but was met largely with silence about their plans, or told the focus was on the athletes. One sponsor that replied, German financial services company Allianz, said it was "in regular contact with the IOC" and stood behind ideals of the Games.

One person in touch with sponsors, who was not authorized to speak and asked not to be named, said the general mood, especially for those focused outside the China market, was to avoid mentioning Beijing and to work around the edges.

"I would not be surprised that the sponsors would remain silent," said Dae Hee Kwak, director of the Center for Sports Marketing at the University of Michigan. "You could potentially lose business."

Retaliation is a concern. The NBA experienced it in 2019 when a Houston Rockets executive sided in a tweet with democracy protests in Hong Kong, Last month, Olympic sponsor Intel had to apologize after publishing a letter on its website that asked suppliers to avoid sourcing from China's Xinjiang region.

Sponsors usually saturate the space around the Olympics. Less so now with lucrative hospitality programs also shelved by the pandemic.

"The sponsors' silence speaks volumes — more than any news release can," wrote Conrad, the sports law professor at Fordham.

The pandemic-delayed Tokyo Olympics stymied sponsors. Fans were banned, officials shuttered an enclosure brimming with sponsor marquees, and Toyota, one of Japan's three major Olympic sponsors, pulled its ads off local TV to avoid being linked to the Olympics. This raised the question of sponsors seeking compensation from the IOC.

The Games were unpopular in Japan when they opened, but polls showed they were seen as successful once they closed.

Asked about its planning for Beijing, Toyota spokeswoman Rina Naruke offered the following to the AP in a brief statement.

"We are unable to provide any specific details at this time. We will update you once we have more information."

Terrence Burns, who has worked for the IOC in marketing and branding but is better known as an independent consultant who helped land five successful Olympic bids, disputed a suggestion that the Beijing Olympics were very different, or that sponsors were treading lightly.

"The marketing opportunity for Beijing 2022 has always been the ability to promote a Chinese Games in the Chinese market; just as it was for the 2008 Games," Burns wrote in an email to AP.

"The biggest commercial impact of the Beijing Games for TOP partners will be in the Chinese market. And realistically, that's not too different from any past Games."

Burns said the IOC's sponsors were in it for the long haul. Coca-Cola has been associated with the Olympics since 1928, and the next few Games look financially promising.

"I see zero commercial evidence of a consumer backlash or concern against any TOP partner. None," Burns wrote.

Upcoming Olympics are 2024 in Paris, followed by Milan-Cortina d'Ampezzo, Italy, and Los Angeles. The IOC has also announced Brisbane, Australia, for the 2032 Summer Olympics, and Sapporo, Japan, is a top contender for the 2030 Winter Games.

Host cities are no longer selected in a bid process, which was subject to well-reported corruption by some rank-and-file IOC members. The IOC leadership now picks the venues with rubber-stamp approval from members.

IOC sponsors have come under pressure from human rights advocates and some members of the U.S. Congress, who have called for moving the Olympics or a full-fledged boycott. Last month an unofficial body set up in Britain concluded that the Chinese government committed genocide and crimes against humanity.

China has called this the "lie of the century" and says the interment camps in northwestern Xinjiang are used for job training.

The five U.S.-based sponsors — Coca-Cola, Intel, Airbnb, Procter & Gamble, and Visa — were grilled in a bi-partisan hearing in July by the Congressional Executive Committee on China.

Most dodged pointed questions, said they had to follow Chinese law, had nothing to do with choosing Beijing as the venue, and focused on the athletes no matter the Games.

Intel's Steven Rodgers, an executive vice president and general counsel, was the only one of five to say he believed the conclusions of the U.S. State Department that China was "committing genocide against the Uyghur people."

Olympic sponsors and NBCUniversal, the broadcast rights holder for the United States, were asked in a letter from Human Rights Watch to be aware of the rights climate in China, and to scrutinize supply chains.

President Joe Biden signed a bill last month that bans goods made in northwestern China's Xinjiang region, unless companies can show forced labor was not involved.

NBC has paid $7.75 billion for the next six Olympics (2022 through 2032) and the network accounts for almost 40% of all IOC income, serving as its main partner. It has begun promoting the Olympics in the United States but minimizes references to Beijing.

IOC President Thomas Bach has repeatedly said the Olympics must be "politically neutral." But they seldom are. Four years ago in the Winter Olympics in Pyeongchang, South Korea, Bach aggressively promoted his bid to drive talks between the two Koreas.

Late last year, the United Nations General Assembly approved the Olympic Truce Resolution by a consensus of the 193 member states; 173 co-sponsored the resolution.

However, 20 nations did not sign up as co-sponsors including the United States, Britain, Japan, Canada, Australia, India and North Korea. The United States and Australia are future Olympic hosts, Japan just held the Summer Olympics and is a candidate for 2030, and North Korea is China's staunchest ally.

Bach has declined to condemn the alleged genocide or speak out on human rights in China. He seldom mentions the Uyghurs by name.

"We have our full focus on the athletes," Bach said. "We welcome that they can participate, that they are supported by their national governments. The rest is politics."

 Additional reporting by The Associated Press.