The International Olympic Committee (IOC) is a privately funded body that generates revenue through the contributions of commercial partners, sponsorships from suppliers, the sale of broadcasting and marketing rights, ticketing, licensing of goods, sale of philatelic and numismatic collectibles, and sale of official merchandise through its suppliers. The IOC contributes to the promotion of sports and athletes around the world by providing financial contributions to International Federations (IFs), to National Olympic Committees (NOCs), towards the staging of the Olympic Games, and through various programs targeted at the development of athletes and coaches.
The Purpose of the IOC
- The International Olympic Committee (IOC) is a non-profit independent international organization committed to the betterment of sports. It was established by Pierre de Coubertin on June 23, 1894, and is responsible for the Olympic Movement.
- IOC’s vision is “building a better world through sports.” It seeks to build on its vision through the values of excellence, respect, and friendship.
- IOC’s missions are three-fold: To “ensure the uniqueness and the regular celebration of the Olympic Games,” to “put athletes at the heart of the Olympic Movement,” and to “promote sport and the Olympic values in society, with a focus on young people.”
- IOC’s working principles are universality and solidarity, unity in diversity, “autonomy and good governance,” and sustainability.
- IOC’s roles as the “supreme authority of the Olympic Movement” involve encouraging and promoting ethics in sport and the education of youth utilizing the medium of sport, supporting sports competitions, encouraging the participation of women in sports, protecting clean athletes and ensuring the integrity of sport, acting against corruption and discrimination, opposing commercial or political abuse of sports or any athletes, and supporting environmental issues, amongst others.
How the IOC Communicates its Purpose
- The IOC communicates its purpose through symbols like the Olympic rings and the Olympic motto of ‘Citius, Altius, Fortius’ that means ‘Faster, Higher, Stronger’ and encourages athletes to showcase their best abilities during competitions.
- The Olympic flag, the Olympic anthem composed by Spiro Samara, and the Olympic flame and torch are other representations through which the IOC communicates its purpose and the Olympic Movement.
- The philosophy of Olympism blends sports with education and culture and encourages a perfect balance of the qualities of mind, body, and will. Olympism seeks to promote joy, good example, and “respect for universal fundamental ethical principles.”
- The IOC promotes the rules and regulations governing the Olympic Movement and the organization of the Olympic Games through the Olympic Charter.
Sources of Funding of the IOC
- The IOC is privately funded and generates revenue through the contributions of commercial partners, sponsorships from suppliers, the “sale of broadcasting and marketing rights,” ticketing, licensing of goods, sale of philatelic and numismatic collectibles, and sale of official merchandise through its suppliers.
- According to the IOC, 73% of the revenue comes from broadcasting rights, 18% from program marketing rights, 4% from the sale of other rights, and 5% from other revenue streams.
- The IOC allocates the global broadcast rights, including broadcasts on radio, mobile, television, and internet platforms, for the Olympic Games to media companies around the world by negotiating rights agreements. This has been the major contributor of the funding of the Olympic Games and the Olympic Movement. The importance of the broadcast rights can be gauged from the fact that the 2018 Pyeongchang Winter Olympic Games received record broadcast coverage and witnessed huge increase in digital viewership.
- The IOC derives funding from sponsorships and supplier programs, products, services, and technical support for the staging of the Olympic Games from its partners under the Olympic partner program. The companies under this program are The Coca-Cola Company, Airbnb, Alibaba Group, Atos, Bridgestone, Dow, GE, Intel, Omega, Panasonic, P&G, Samsung, Toyota, and Visa.
- “The Olympic Games ticketing program” managed by the Organizing Committees ensures that tickets to the Olympic Games are available for fans, thus generating the necessary financial revenue for the IOC.
- “The IOC Global licensing program” generates revenue for the IOC through merchandising programs that promote the Olympic brand and enhance its brand value. The program is divided into three sub-groups that target specific groups of fans:
- The Olympic philatelic program through which the IOC sells Olympic stamps and the Olympic numismatic program through which the IOC sells Olympic coins are important sources of revenue for the IOC.
- IOC derives significant revenue from sponsorships from its suppliers, such as IOC’s official imagery supplier Getty Images, its formal uniform supplier Hengyuanxiang Group (HYX), and its “official sportswear uniform supplier” ANTA Sports Products Limited.
Spending by the IOC
- 90% of the IOC’s revenue is distributed to the member organizations in the Olympic Movement so that they can promote the development of sports throughout the world and contribute to the “staging of the Olympic Games.” This equates to over $3.4 million every day and $5 billion during the four years between two Olympic Games.
- The rest 10% of the IOC’s revenue is used for managing its operations.
- On an average, the IOC spends around $2.5 billion for staging the Olympic Games (the Summer Games, the Winter Games, and the Youth Olympic Games) in a four-year cycle in order to lessen the financial burden of the host cities.
IOC’s Contribution in Promoting Sports and Athletes
Contribution Towards Athletes
- In accordance with the principles of the Olympic Movement, the IOC supports athletes around the world. This is done not only during an Olympic Games but throughout the year. The IOC’s funds are utilized to finance athletes’ commissions around the world for promoting their empowerment.
- Since the protection of clean athletes is a primary objective of the IOC, 50% of the budget of the World Anti-Doping Agency (WADA) comes from IOC. The rest 50% is financed by the world governments.
- As part of the 2017-2020 Olympic Solidarity Plan, IOC has allocated more than $0.5 billion on various programs aimed at athlete development. The Olympic scholarship programs utilize part of this fund and provide needy athletes with monthly training grants and travel subsidies to participate in Olympic qualification competitions.
The Athletes’ Career Transition Program
- The IOC has pledged to support athletes around the world beyond the Olympic Games as a part of its Olympic Agenda 2020.
- The 2017-2020 Olympic Solidarity Plan introduced the “Athletes’ Career Transition program” to support athletes associated with various National Olympic Committees (NOCs) around the world. This program provides funding and necessary career advice to athletes irrespective of the stage of their career.
- Athlete365 is a dedicated brand that supports the Olympic-level athletes of the world “through a centralized digital hub.” The support is provided both during the Olympic Games and before and after the Games.
Financial Contribution Towards the Staging of the Olympic Games
- IOC’s financial contribution enables the staging of the Olympic Games. There has been a 60% rise in the IOC’s spending on the Winter Games between the 2002 Salt Lake City Winter Games and the 2018 Pyeongchang Winter Games.
- The IOC’s increasing financial contribution towards staging both the Summer Games and the Winter Games can be gauged from the graphic below.
- A similar increase is visible in IOC’s increasing spending towards staging the Youth Olympic Games over the years.
Financial Contribution to International Federations (IFs)
- The IOC provides financial contribution to International Federations (IFs) to govern, operate, develop, and promote their respective sport at the international level.
- There are 33 Summer Olympic IFs, 7 Winter Olympic IFs, 36 IOC-recognized IFs, and 5 IOC-recognized IF associations.
- The IOC’s increasing financial contribution towards the IFs can be gauged from the graphic below.
Contribution Towards National Olympic Committees (NOCs)
- The IOC also provides financial contribution to National Olympic Committees (NOCs) around the world to encourage them to promote and develop sports in their respective countries. The IOC recognizes 206 NOCs.
- The IOC’s increasing financial contribution towards the NOCs can be gauged from the graphic below.
- In accordance to the principles of the Olympic Solidarity program, the IOC allocates a large chunk of the profits from the Olympic Games to NOCs in order to financially assist athletes and coaches with great financial need. This contribution is also to encourage rigorous preparation, high-level coaching, and travel to competitions.
- Besides allocating money for athlete development, the IOC’s Olympic scholarship programs also provide funding for the education of coaches from various NOCs. Between 2012 and 2016, IOC provided technical training in 988 courses to coaches from 172 NOCs. 641 coaches received scholarships to enhance their coaching education.
- The IOC’s “Refugee Athlete Support program” helps NOCs to extend assistance to refugee athletes that are living in their countries so that they can prepare themselves for participating in international competitions.