Sponsors Log Out of Indian Cricket Due to Scam

The Supreme Court's suggestions about credibility crisis in the leadership of Indian cricket has made stakeholders and sponsors nervous. This after arguments on the first part of the Justice Mukul Mudgal Commission report on betting and fixing in the Indian Premier League came to an end on Wednesday.

While some of the sponsors associated with the sport in the country are patient, a prominent few however have gone ahead and delinked themselves. Reebok scrapped its association with the Chennai Super Kings this month. Max Life insurance sponsored the Pune Warriors but exited the league a few years ago. Many such brands have come and gone in the past seven years. Currently though, the IPL may be facing its most serious threat of sponsor pull-outs.

The spot-fixing and illegal betting scandal followed by the ongoing case in the Supreme Court has put the league's reputation at stake. Max Life Insurance's Director Anisha Motwani, for instance, is treading cautiously. "I would be very conscious about sponsoring cricket teams because teams have connections with individuals and their reputation," she said. "The upswings and the volatility respect to reputation is pretty high. We have sponsored Pune earlier but this year I would be  weary of putting my money behind any team because teams are susceptible to the actions of individuals."

There is a general consensus that IPL's reputation has been dealt a huge body blow. To make matters worse, the body that is in the eye of the storm is the BCCI, responsible for controlling the sport in the country. The controversies have made the sentiment of the investors bearish. Marketing analyst Harish Bijoor feels investors would always want to steer away from controversies."IPL is cricketainment and in cricketainment as far as the viewer is concerned, he loves every controversy. But as far as an investor is concerned, particularly in this day and age when corporate norms are so strict, when every individual wants to look clean, everyone will be careful."

The impact has been seen in the last two years. The BCCI had to sell its title sponsorship rights at the base price for the last two seasons and they had to virtually give the internet and mobile rights for free as they were picked up as part of the title sponsorship package.  Experts attribute sponsors' lack of interest to bad governance.

The man in the eye of the storm is N Srinivasan. The BCCI's decision to amend its own rules to allow him to buy the Chennai Super Kings franchise hasn't gone down too well with the Supreme Court. It has also made brands jittery. "If you are not true to the purpose of why you want to be in business then executives are immaterial, said Ashwani Singla, MD & Chief Executive Asia, Penn Schoen Berland. "They will be defined by a steadfast commitment to a purpose and the core values by which they want to run the business. I do not think changing of leadership from one to another will make any difference unless one thinks about creating a governance structure and a constitution by which one can abide by and live."

BCCI has changed its constitution twice in the last seven years. Though the investors are clear that they want to be associated with a clean game but the cosy club, headed by the president in exile have so far failed to get the message.