New Zealand’s provinces will be asked next month to choose between adopting wholesale changes to rugby’s governance system as recommended by a comprehensive independent review, or a compromised version put forward by themselves.
New Zealand Rugby will give notice this week that it will hold a Special General Meeting, at which its members will be asked to vote in a binding ballot.
Despite agreeing with the findings of the Pilkington Review published in August last year – a 134-page independent report which found the current governance structure was not fit for purpose and recommended implementing a new system that would produce nine independent directors to sit on the board of the national body - five months of negotiations between NZR and the unions have failed to produce a unanimous agreement that this is the best way forward.
NZR chair Dame Patsy Reddy has, therefore, opted to present unions with a choice of voting for the most radical governance change in the game’s history – one that will lessen their power and influence – or to greenlight a less dramatic change that will preserve the unions’ status as the key decision-makers in the national game.
In a statement to the Herald, Dame Patsy, said: “NZR is imminently looking to call our voting members to an SGM to vote on the recommendations made in the governance review.
“Should that not be successful, NZR will ask members to vote on an alternative governance proposal which we believe still meets the underlying principles of the governance review.
“As a board, our focus is on ensuring that reform has the best possible chance of success and secures the necessary two-thirds majority of the votes. Our intention is to make both governance proposals publicly available as soon as they are finalised in the coming days.”
But while the presence of two proposals on the ballot is being pushed by NZR as a sign of Reddy’s determination to force governance change of some kind, it’s a move that is not supported by the Rugby Players’ Association, whose boss Rob Nichol has branded it “disingenuous”, and warned that the players will have no confidence in an NZR board appointed through a system designed by the provincial unions.
“We have made it clear that we expect the [Pilkington Review] recommendations to be adopted in full and if they are not, then we are absolutely reserving our right to reconstitute our relationship with the game,” Nichol says.
“We will not trust a governance model that is not based on those best practice recommendations.”
The RPA called for an independent review of NZR’s governance structure back in mid-2021 as a condition of returning to the negotiating table when discussions about a proposed private equity deal with US fund manager Silver Lake broke down.
NZR in partnership with the RPA, agreed both the composition of the review panel - former Fonterra executive David Pilkington, former All Blacks captain Graham Mourie and experienced directors Anne Urlwin and Whaimutu Dewes – and the terms of reference, which were: “To answer a simple question: Is the constitution and governance structure of the New Zealand Rugby Union fit for purpose – to ensure the appointment of a board that has the required matrix of skills, experience and qualifications to govern effectively; and to confront the challenges, and maximise the opportunities, that will present themselves (including the establishment of a new commercial entity)? If not, what are the changes that should be made to allow it to be so?”
The review concluded the current governance model was not fit for purpose, and recommended moving to a new system where all directors are independently appointed by a panel comprised of two people independently appointed by the Institute of Directors (IOD), one independent member – not a current NZR director – chosen by the board and two members picked by the new stakeholder council that it has been suggested be formed.
But the make-up of this panel has been a source of contention for the provincial unions, who have put forward various alternatives in closed-door negotiations with NZR – all of which have given them majority representation and ultimately the ability to control who is appointed to the board.
It is believed the voting proposal at the SGM will be to approve the creation of an eight-person stakeholder council that will comprise four provincial members, one from the Māori Rugby Board, one from the RPA, one from Super Rugby and a representative from the Pasifika Advisory Council which will select three representatives to sit on the appointments panel.
The appointment panel in this proposal will comprise three provincial union representatives, one NZR-appointed member – who will not be a current board member, and two independent representatives, one of whom will be the chair and one of whom must be a woman.
NZR and the unions believe that their amended proposal reflects the broader principles of the review, but Nichol says it retains controlling power with the provincial unions and he is adamant that it makes no sense to commission a review, agree that it was conducted by the best people and its findings were comprehensive and correct, and then compromise the recommendations.
“When everyone accepted the findings of the report, they fairly assumed that would mean that everyone was going to follow the recommendations,” says Nichol.
“But for the last five months what has become apparent to us is that the provincial unions don’t like the recommendations and they have been working with NZR to see if they could develop a different set of recommendations that better suited their purposes.
“This is something we don’t support.
“This is where you get into trouble. The panel made recommendations on best practice, and these are the ones that need to be adopted and implemented.
“Everything else that we have seen is an effort by the provincial unions to retain control of the appointment of the NZR board and that will undermine the whole purpose and ethos of the recommendations.”
It is also believed that NZR’s current board members are seeking to see out the full length of their respective terms, meaning that whatever change to the governance process is agreed, it may take several years before the board is populated by people appointed through the new system.
The RPA and the provincial unions are of the view that the current board should resign and put themselves forward to be reappointed through whatever new system is agreed.
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