The Olympics as Risk Governance

1. The Olympics as Risk Governance Will Jennings University of Southampton

2. Governance and the Olympics • Why risk matters… • Trends in Olympic governance • Pathologies of Olympics governance

3. Governance • Complex web of negotiated governance, typical of international sport. • The IOC as a ‘hands-off’ steering force at the centre, intersecting with other international federations/bodies and national authorities. • Host cities as agents of the IOC and the host government, subject to capture by economic interests. • Large ‘mega’ projects that span the public and private sectors (i.e. contracting out). • ‘Neoliberal’ projects in economic and social terms? (Markets and individualism?)

4. Risk • Societal risk • externalities of events (e.g. construction safety, population flows, environmental impacts, waste, public health, accidents, congestion) and magnet of malevolent forces (e.g. crime, terrorism, cyber attacks). • Institutional risk • Risk in governance, institutional (organisational and political) pressures for safety and security (e.g. terrorism and ‘emerging risks’), objects framed as ‘risks’ to organisation, failures in event programme management (e.g. cost overruns).

5. Trends in Olympic Governance • Risk and its governance, combined with the influence of economic interests, gives rise to processes of ‘institutional isomorphism’ (DiMaggio and Powell 1983) as organisational units increasingly resemble one another. • The rise of risk transfer (e.g. insurance, market-based tools) and risk management in financial management, and later redefinition of risk in non-financial terms (see reputational risk below). • IOC programme of bid evaluation and event monitoring and impact measurement; popular rhetoric of social and economic justification. • Formalisation of knowledge transfer between host cities and applicants. • Standardisation of event planning and operations (e.g. benchmarking, technical manuals). • Management of ‘reputational risk’ and use of public opinion research. • ‘Consultocrats’ as carriers of knowledge (and the claimed oracles of organisational wisdom): ‘Czars’ (and their self-congratulating autobiographies, e.g. Mitt Romney!), epistemic communities and a closed network of professional service firms. The rise of the Olympic nomad.

6. Pathologies • The ‘performance paradox’: popularity of mega-events and mega-projects despite ‘optimism bias’ over costs and economic benefits and supposed sensitivity to risk! • cost overruns are endemic, economic impacts are questionable. • moral hazard problems (e.g. cost of insurance, contracting-out) and capture. • long-term horizon of planning, short-attention span of policy-makers (inability to think ahead to legacies so decision-making processes fail to overcome inter-temporal conflicts). • ‘fantasy documents’ and creative public accounting used to resolve uncertainty and ambiguity, but technical instruments of control unable to prevent drift or guarantee readiness. • decision-making errors in cross-event reading of information without challenging of underlying assumptions or context. • ‘Small world’ of Olympic consultocrats and professional service firms, defining the planning reality and operational requirements on a vast scale. Olympic ‘family’ determine who has access. But a relative absence of ‘real’ organisational knowledge. Nomads and career-climbers.