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CONCACAF outlines reform after FIFA corruption scandal

With its reputation in tatters following a corruption scandal, CONCACAF announced on Monday a reform framework that has been approved by the organization's Executive Committee.

The proposals for North and Central American and Caribbean's governing body contained in the framework were put forward by a three-man special committee consisting of U.S. Soccer Federation president Sunil Gulati, Canadian Soccer Association president Victor Montagliani, and Mexico Football Federation president Justino Compean and distributed to media one day before CONCACAF's Gold Cup tournament kicks off in the United States.

The committee was formed after the U.S. Department of Justice indicted former CONCACAF president Jeffrey Webb and former CONCACAF Executive Committee member Eduardo Li. CONCACAF general secretary Enrique Sanz was identified as an unindicted co-conspirator and was suspended from his duties.

"This Reform Framework reflects CONCACAF's commitment to strengthening our governance, management, and operations," the organization said in a prepared statement. "These reforms are intended to apply best practices for sound corporate governance to CONCACAF's business operations. In implementing the Reform Framework, the Confederation will demonstrate to its fans, sponsors, member associations and other stakeholders that CONCACAF is resilient and devoted to managing, developing, and promoting the game with accountability and transparency."

Many of these proposals will require changes to CONCACAF statutes as well as approval by the organization's members. They cover three primary areas: corporate governance, fraud prevention, and transparency.

On the corporate governance side, the proposals include the following: an as yet unspecified number of independent members on the ExCo, term limits on ExCo members including the president, the approval of ExCo member compensation to be done by independent members of the compensation committee, the appointment of independent members to CONCACAF's governance committee to evaluate governance and transparency on an annual basis, and provide training to ExCo members and organization officers on issues of corporate governance and transparency.

Among the steps to aid CONCACAF in areas of compliance and fraud prevention, the organization plans to name a chief compliance officer who will oversee the compliance program and report to the general secretary and independent members of the audit committee. CONCACAF will also appoint a chief legal officer to create a more robust legal department to manage contracts and legal liability.

The organization plans to institute a system in which credit and background checks will be conducted on all vendors, and will reserve the right to impose audit rights on those vendors to make sure they comply with bid process and covenants regarding bribery and compliance with a code of ethics. A whistleblower hotline will be implemented and administered by CONCACAF's audit committee.

With regard to transparency, the reform framework states that all financial statements and the CONCACAF budget will be made public, as will all officer and ExCo member compensation. The charters of the audit, compensation, governance, and the special committee will also be made public on the CONCACAF website, as will the agenda of ExCo meetings, CONCACAF said.

While the framework laid out some broad strokes, it was short on details. Sam Ghandi is the head of corporate practice at Sidley Austin LLP, the law firm that worked with the special committee to draw up the framework, and continues to conduct the investigation into CONCACAF's financial dealings.

When asked how many independent members there would be on the ExCo, and if there would be background checks, Ghandi said those details had yet to be fleshed out.

"Public companies have a majority of independent [board members]," he said via telephone. "I don't know if we're going to go that way, but at this point we need outside voices on our board. We need a structure that incorporates that. I don't have an answer as to what the right number is yet."

Ghandi said it also remained to be seen how the independent members of the governance committee would be selected and vetted. Ghandi added that to hold an extraordinary congress requires four months' notice, and that CONCACAF's next ordinary congress would be held next spring. Ghandi said he and the special committee plan to use the time to sound out the individual members of CONCACAF, and work with them to iron out the details.

Some of the proposals contained in the framework, such as term limits and public disclosure of ExCo compensation, were made to FIFA, only for those to eventually be discarded. Ghandi said that CONCACAF will be different.

'The big difference between CONCACAF and FIFA is that the CONCACAF ExCo is completely behind these proposals," he said. "In FIFA, those proposals weren't really embraced."

Ghandi said that the organization had a lot of work to do to win back the trust of CONCACAF's various stakeholders.

"This is going to be a long process," he said. "The framework is just a first step. We're just getting started."

Alexandra Wrage, who served on FIFA's Independent Governance Committee, criticized the proposed reforms in a series of tweets. 

Wrage, a leading FIFA anti-corruption adviser resigned from her post in 2013, contending that football's governing body failed to change its culture after bribery and vote-buying scandals.

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