Morals Clause Endorsement Agreement

A particularly strict clause may be: ”If, according to the promoter, the athlete is subject, at any time, to a public discussion, contempt or scandal affecting the image or value of the athletes, the company may immediately suspend or terminate this agreement and the services of athletes as part of this agreement, in addition to any other rights and recourse. that the sponsor may have here, in law or in the form of justice. From a professional athlete`s perspective, there are several things they can do to better protect themselves from being at the wrong end of a moral clause in a sponsorship or support contract. Sleep contracts between companies and celebrities or other famous personalities contain explicit moral clauses. Therefore, the law does not provide for a legal obligation to restrict or emphasize the scope of such a clause. On the face of it, it may appear that the inclusion of these clauses is patently unfair, as it is intended to regulate a person`s action in his or her private life, otherwise a company may impose significant penalties or even terminate the contract if it so wishes. However, further examination justifies the argument of companies in the preservation of their interests by a morality clause. Companies sign an agreement with celebrities, athletes and other famous personalities (”Endorsers”) for colossal sums of money based on the persona cultivated by the Endorser. Often, a whole campaign is developed by the company around the Endorser regarding the product or brand. It is intended to produce the same qualities as the public and the endors. Therefore, in short, these clauses exist because of the deep connection that the public has just associated between the brand and the endors.

Third, athletes should not forget their contractual obligations once the contract is signed. In other words, they must consider the possible consequences before taking action. In such a scenario, it becomes important for the company to be able to dissociate itself from the Endorser when it reveals that the Endorser has abandoned actions contrary to either what the company represents or to general moral standards respected by a given company. From the company`s point of view, it would be preferable to keep the moral clause as broad and broad as possible in order to take into account a considerable number of activities that could trigger the moral clause at its discretion. Typical phrases are the act of moral turpitude, outrageous behavior, public discredit, offense to public morality, etc., without listing the specific actions, situations and circumstances that can lead a Dedors to violate the clause. During the deforestation of a moral clause, companies should cover not only the acts committed, but also the acts alleged against the Endorser. Because for the brand and the goodwill associated with it, public opinion can go very quickly south according to possible inappropriate behavior and the damage done to the brand and its reputation is done in most years, before any confirmation for the same thing. Lance Armstrong and Tiger Woods are arguably the embodiment of success in cycling or golf. Both have been hugely successful in their respective fields, so it was only a matter of time before sports giant Nike wanted to see them as the face of their business. But both have faced scandals that have tarnished their public image. In this situation, Nike`s reaction to these approval contract scandals was taken into account.

However, since approval relationships are partnerships and not adversarial service agreements, the parties should cooperate in developing an appropriate morality clause. There are a number of issues that need to be considered when moral clauses are negotiated – for example, which are the parties involved. B What are the potential risks in the relationship and what are the potential damage in the event of a problem.