Division to be main theme for New Zealand rugby in 2024 - Gregor Paul

NZR chief executive Mark Robinson has faced criticisms about himself and the organisation. Photo / Photosport

After four of the most tumultuous years in modern New Zealand rugby history, there were hopes that 2024 would deliver the stability new All Blacks coach Scott Robertson needs to take the team to new heights. But next year is poised for yet more confrontation and upheaval as the provinces are divided on whether to proceed with a major governance overhaul, the Rugby Players’ Association and New Zealand Rugby are at war again over the Silver Lake deal and some unions are pushing for significant change in the national body’s executive leadership team. Gregor Paul reports.

It’s almost four months since an independent review found that New Zealand Rugby’s current governance structure is no longer fit for purpose, but its recommendation to make radical change is being resisted by a handful of provincial unions.

Having indicated in written correspondence to NZR in early December that they were broadly supportive of the findings and willing to embrace change, further meetings between the unions and the national body have failed to produce a consensus about a way forward.

Such is the level of division between provincial unions about whether to blow up the current governance structure, they are exploring the feasibility of pushing next year’s NZR annual general meeting back by three months to July.

The AGM, initially scheduled for its usual April slot, could be held later because the unions are trying to buy more time as they work out whether they can agree to the review’s key recommendation of ditching the existing governance approach to appointing, nominating and electing board members.

Instead, the review has recommended a new system where nine independent directors are appointed by a five-person panel.

The unions must reach a majority agreement to pass any changes, and the initial hope was they would do so in time to make the constitutional change at next year’s AGM.

The source of contention as the Herald understands it, is a difference in views among the unions about whether they should control or influence the process of appointing directors.

The review has said this appointment panel should consist 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.

The panel also has to include knowledge of Māori and Pasifika rugby.

But the unions, in correspondence to NZR, have proposed the panel be made up of: “Three representatives of the Provincial Union Group – two of the three must come from the NPC group and one from the Heartland Championship group.

“Two of the panel would be independent members of the group – recommended by the IOD.”

By having three representatives on the appointment panel, the provincial unions would be able to control who ended up on an “independent” board, whereas the review recommendation of only having two provincial representatives would restrict the unions to only influencing the appointments.

The Rugby Players’ Association, which asked for the review as a condition of reigniting talks to sell an equity stake to fund manager Silver Lake in 2021, is believed to be pushing the unions to adopt the review’s recommendations as they are, rather than trying to negotiate amendments.

There were two days of meetings held between the provinces and NZR on December 7 and December 8, but they failed to establish a unanimous position among the unions – with many refusing to budge on their insistence that they should control the panel.

Well-placed sources have told the Herald the unions fear that if they don’t control the panel, NZR’s board will end up with directors without genuine connections to and understanding of the community game.

The unions, though, have been assured the review’s recommendation that directors be appointed to fulfil a stakeholder-determined skills matrix, will ensure there will always be people on the board with strong experience in grassroots rugby.

Still, despite the various meetings and dialogue, the situation has been described as a stalemate.

Division is looking like it will be the central theme of 2024, as the unions are also seemingly split on how they feel about NZR’s executive, leadership team.

In late November, the Herald obtained draft correspondence that the unions were working on to send to NZR.

In this version, the unions wanted assurances from the existing board that no matter what governance structure was agreed, that the No 1 priority in 2024 would be to drive major change in the executive and leadership of NZR.

The letter made it clear the unions were dissatisfied and disillusioned with a management regime which they saw more as an enemy rather than a trusted partner.

The unions said they had doubts about the ability of NZR’s management team to follow coherent strategy, build and maintain relationships with key stakeholders and international partners, foster trust and communicate effectively.

In that letter, the unions said: “Before we provide specific feedback on the recommendations in the Pilkington Report, we want to stress that while the report and its recommendations are specific to the governance of NZR, the report strongly indicates the need for a significant change in direction in leadership and management across the organisation.

“While we agree that proposed changes to governance will create the right environment for a more productive and sustainable future, nothing will change unless there is a targeted focus on shifting the leadership and management practice within NZR.

“Areas of the report identify strategy, culture, communication and relationships as sub-standard, and while the provincial unions can accept some responsibility for this, we need to see a demonstrable lift in leadership from NZR to forge a new path forward for the rugby system.

“Only NZR’s governance ([board] can implement this change, so whatever model we land on for the future, the board of NZR must make this focus on leadership accountability their top priority for the future of the game.

“We are seeking assurance from the NZR board that this will be a priority under any new agreed governance model.”

But that draft was never sent to NZR, as it is understood it didn’t accurately reflect the views of all the signatories.

The revised correspondence, which was sent to NZR, is, according to those who have seen it, still critical of the executive but softer in its tone.

Nor is it believed to ask the board for assurances around prioritising leadership change, while the subject of NZR’s leadership competency wasn’t brought up by the unions during the face-to-face meetings on December 7 and 8, leaving it unclear as to whether a management cleanout is a priority request or not.

One source has said a small number of influential unions are disgruntled with the performance of NZR’s management team, but there does not appear to be a universal appetite to pressure the board to prioritise leadership change.

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The big unknown heading into 2024 is what it will take to bring the provincial unions to a majority decision about the governance review.

The Herald has canvassed opinion from a variety of stakeholders and influential figures, none of whom believe the unions have a compelling argument to control the appointment panel or continue to resist the findings of the review.

They also don’t believe the unions are right to self-style themselves as the “owners” of rugby in New Zealand, as they argue there are multiple facets of the rugby ecosystem, such as broadcasters, media, professional players, Super Rugby, teams in black, to which the provinces have no proprietary claim.

It is thought that some of the unions resisting governance change are doing so out of fear about the future shape of the national provincial competition.

NZR chief executive Mark Robinson said recently he doesn’t think the current model is fit for purpose – a point the Pilkington Report also made, when it wrote: “Few, if any, would contend that a country of five million people can support six professional franchises and 14 NPC teams with a high and growing investment in professional players.”

Entwined with this wider belief is NZR’s view that provincial unions need to be focused more on the community game – growing participation, facilitating stronger club competitions and providing increased opportunities for players of all genders – rather than spending big on high-performance teams to try to win titles.

This tension and uncertainty around the future of the provincial competition may also be driving some of the disgruntlement around the performance of NZR’s leadership team.

The findings of the governance review also allude to numerous shortcomings within NZR’s management.

The Pilkington Review’s terms of reference were to determine whether the game’s current governance structure is fit for purpose and so there are no direct and damning criticisms of NZR’s leadership as such, but some of the findings, by reflection, illustrate poor practice by the executive.

The review carries a strong narrative of poor communication between NZR and the provinces, a lack of strategic direction by the executive and a sense that the national body is insular, protective and focused on the past, not the future.

There is one specific finding which the Herald is aware has particularly troubled some unions as it alludes to NZR operating to such vague and ill-defined strategies as to make it almost impossible for the board to hold the executive leadership team accountable.

“The high-level strategic plan (Strategy 2025) mixes up ends and means, desired outcomes and planned actions, strategies and tactics,” the review says.

“Headline statements such as the four labelled ‘strategic pillars’ (Winning with mana; Rugby at the heart of our communities; Loved game, loved brands; Unleashing rugby’s commercial potential) may be good soundbites but do not create a framework for stakeholders to hold NZR accountable.

“They do not assist the NZR board to hold management to account either.

“The chief executive’s reporting dashboard has 48 key performanceindicators (KPIs); most of them are tactical at best and lacking measurability.

“There is simply too much indistinguishable detail coming to the board. There needs to be a focus on a smaller number of measurable outcomes.

“The lack of clearly stated outcome expectations in favour of statements of intended activity, and the multitude of low-level tactical KPIs mean that directors are drawn into the operational domain.

“This tends to fix the board as a supra-layer of management – driving into the future with its attention on the rear-vision mirror, doing the wrong job (or not enough of the right job).”

The Herald has spoken to several people connected to the community game who have said the letter sent to NZR didn’t accurately reflect the true level of concern within some provincial boardrooms.

Critics of Robinson’s tenure say they have ample evidence on which to base their belief the NZR must make changes.

They point to the mishandling of the Silver Lake investment, in which NZR was drawn into a public and destabilising civil war with the professional players – one which ended with the national body having to greatly revise the initial deal hey had previously said was one of the best private equity offerings professional sport had ever seen.

As the Herald has recently revealed, hostilities between NZR and the RPA have reignited over whether to proceed with the second, pre-agreed capital raise.

The way in which the Covid-enforced break-up of Super Rugby was handled, is another perceived fail by NZR.

The abrupt and callous nature by which NZR terminated the agreement and then tried to squeeze Australia out of a proposed new format was seen as the source of all the problems between the two nations these past four years.

The Pilkington Review also made this point when it said: “For some, New Zealand is seen as arrogant in its approach to international engagement – it could do well to address this.”

And the process by which former All Blacks coach Ian Foster was hired, then retained, before effectively being fired is held up as one more example of poor leadership.

But there have been some successes in the Robinson era, particularly commercially, with annual income having risen from $190 million when he came into the job, to $270m.

A joint venture agreement for Super Rugby has been signed – one which will see the competition run more under the auspices of an independent commission – while the Black Ferns have won the World Cup, and the All Blacks made the final.

NZR has also invested $20m in women’s rugby in the past year, launched a Pasifika strategy and kept participation numbers steady.

The only certainty is that 2024 is likely to prove as turbulent and as unsettling as the four previous years and that off-field issues are likely to once again shadow what happens on it.

Gregor Paul is one of New Zealand’s most respected rugby writers and columnists. He has won multiple awards for journalism and has written several books about sport.