When the boardroom doesn't play ball

Fifa's plan to create a for-profit subsidiary with private equity has run into corporate boardroom opposition by influential shareholder blocs like Uefa, Europe's governing body of football, and Concacaf, its counterpart in North America, Central America and the Caribbean. This is threatening a demerger. Fifa's shareholding doesn't have superior voting rights and Fifa president Gianni Infantino is likely to have his special resolution passed by majority voters before its next extraordinary shareholder meeting. Hence, threats by Uefa and Concacaf to boycott the World Cup Fifa is planning on handing over to its proposed subsidiary, Fifa Forward Enterprise (FFE). Fifa will sell a 20% stake in FFE to private investors and use the proceeds to triple its payout to shareholder-nations to develop the game locally. FFE's role would be to monetise tournaments better and improve future revenue flows. Fifa as a non-profit should be able to convince authorities about its tax-free status.

Where this vision muddies up is in how FFE goes around making more money for Fifa's shareholders. The PE component is expected to draw heavily from investors in North America, and opposition by Concacaf, which has organised the most lucrative World Cup so far, matters. FFE would need to expand existing leagues to build up its revenue stream. That runs into resistance from players' unions within Uefa to expanding match calendars and work overload. Yet, neither of these opposition blocs is united. Smaller Uefa member nations see the merits of Infantino's plan. Likewise, Central American and Caribbean countries in Concacaf would fancy the extra revenue FFE represents.

This is boardroom discontent 101. Infantino's plan to restructure Fifa has a good shot at widening football's appeal. But how he's going about it seems to have upset Fifa's important stakeholders. And in the modern world of boardroom consensus, that's almost having a plan that's dead in the water, no matter how noble the intent.