Out-of-control Olympics: why the IOC is unable to ensure an environmentally sustainable Olympic Games

Although the International Olympic Committee (IOC), the body responsible for overseeing the organisation of the Olympic Games, has placed a high premium on environmental sustainability for more than two decades, recent editions of the Olympic Games have fallen short of their sustainability goals, or have caused outright environmental harm. By applying a new (principal-agent) perspective and conceptualising the environmental harm caused by the Olympic Games as an agency cost, this article demonstrates that the mechanisms the IOC deploys to control Games organisers are ineffective because they fail to alter the incentives of Games organisers towards compliance with environmental sustainability objectives and that recently proposed changes through the IOC’s Agenda 2020 reforms fail to address this issue. In order to lower agency costs, the IOC must increase its control by involving qualified and independent third parties in its host selection process, provide for a clear mandate in the Host City Contract, and introduce credible sanctions that impose a significant cost on hosts for failing to adhere to environmental objectives.