Imagine donating money to your favorite sports club, only to discover months later that nobody can explain where it went. Or picture national athletes losing their prize money because officials “misplaced” the records. Unfortunately, these aren’t hypothetical scenarios—they happen when sports organizations operate without financial transparency.
Financial transparency means openly showing where money comes from and where it goes. It sounds simple, but its absence has destroyed some of the world’s most prominent sports organizations.
The Real Cost of Hidden Money
When sports institutions hide their finances, corruption thrives. FIFA, football’s global governing body, faced massive scandals when investigations revealed that development funds—meant for building sports facilities in poor countries—mysteriously ended up in private bank accounts. Officials had hidden these transactions for years.
The International Olympic Committee has similarly struggled with questions about fund allocation. Without clear financial reporting, stakeholders cannot verify whether money serves its intended purpose or lines someone’s pockets.
Even here in Sri Lanka, sports governance issues have repeatedly made headlines. The Ministry of Sports recently faced scrutiny when discrepancies emerged in how grant money was spent, highlighting the urgent need for transparent financial systems across all sports bodies.
Three Pillars of Financial Transparency
Good financial governance rests on three foundations:
First: Open Records. Every rupee received and spent should be documented. Income sources—whether from membership fees, sponsorships, ticket sales, or government grants—must be clearly recorded. Similarly, all expenses need proper documentation with receipts and justifications.
Second: Regular Reporting. Organizations should publish financial statements at least quarterly, not just annually. Waiting twelve months to reveal financial information allows problems to grow unchecked. Regular updates let stakeholders spot issues early.
Third: Independent Verification. Internal audits aren’t enough. External auditors who have no financial interest in the organization must review the books. These independent experts provide credibility and catch irregularities that internal teams might miss.
Why This Matters to Everyone
Athletes and players rely on transparent systems to receive prize money and benefits. When finances are hidden, payments get “delayed” or “lost.”
Sponsors and donors need assurance their investments reach intended programs. Companies won’t support organizations that can’t demonstrate responsible fund management.
Government agencies providing public funding require financial accountability as a condition for grants. Sports bodies without transparent practices risk losing crucial government support.
Members and fans deserve to know their fees and ticket purchases actually support the sport rather than funding lavish lifestyles for administrators.
The Chess Example
Chess offers an instructive case study. FIDE, the international chess federation, experienced severe financial problems when their reserve fund dropped 74% in a single year—from €1.2 million to just €332,343. Event organizers had failed to pay what they owed, but poor financial tracking meant these issues weren’t caught early.
Since then, FIDE has improved its practices, joining the Sport Integrity Global Alliance and committing to higher financial standards. This organizational reform hasn’t just prevented future crises—it’s attracted more sponsors and strengthened chess globally.
The Chess Federation of Sri Lanka, now one of Asia’s most active chess bodies, demonstrates that even developing nations can maintain strong governance. As Sri Lanka aims to become a top chess nation in Asia, maintaining transparent financial practices will be crucial for attracting the international support and sponsorship needed to reach that goal.
Building Trust Through Transparency
Transparency builds trust, which creates a positive cycle: Better governance attracts resources, improving programs, which attracts athletes and fans, generating more revenue and support.
Take Action
Ask questions. Request financial statements when joining a sports club. If they refuse, consider it a red flag.
Attend meetings. Your presence at general assemblies encourages accountability.
Demand standards. Support candidates who commit to transparent practices in federation elections.
Use available tools. Many countries have Right to Information laws allowing citizens to request financial data from government-funded sports bodies.
The Path Forward
Sports governance worldwide is improving as organizations recognize transparency is essential for survival. Those who resist lose sponsors, government support, and public trust.
Sri Lankan sports bodies have begun this journey with recent ministerial actions emphasizing accountability. This momentum must continue.
Financial transparency isn’t complicated—it requires commitment to honesty. Every sports organization can implement these practices. The question is whether they will before a crisis forces their hand.
Every great sports institution is built on trust. And trust is impossible without transparency.
