If New Zealand Rugby had an annus horribilis, it would have been 2016. And it had nothing to do with score lines or referee decisions.
Men Behaving Badly.
All Black Aaron Smith in a Christchurch Airport toilet.
Members of the Chiefs Super Rugby team manhandling a stripper at a boozy end-of-season party. Another Chiefs player, Michael Allardice, making homophobic comments at the Okoroire hot springs. Racist slurs against Pacific Island players. Incidents involving rugby players and excess alcohol; incidents involving rugby players and drug-alcohol combinations.
The sponsors started getting restless. Nice sportswear manufacturers, banks and insurance companies have enough potential trouble with allegations of child labour and misconduct investigations, without being emblazoned on the shirt of an All Black halfback spotted coming out of a bathroom with a woman who isn’t his partner.
Even worse: a disabled bathroom.
Nicki Nicol joined NZ Rugby in February 2017 as chief financial officer and head of corporate service, just as the Respect and Responsibility review panel commissioned by CEO Steve Tew and chaired by Law Society president Kathryn Beck was forming.
Nicol, a chartered accountant by training, had spent six years working for oil company BP, four of them in Australia, the last two as chief marketing officer.
She didn’t come back to New Zealand for the NZ Rugby job; she and her family were coming home so her teenage daughters to go to high school in New Zealand. Her main criteria for a new role was commercial leadership, a strong brand – and a challenge.
She got all three. In spades.
When the respect and responsibility report came out in September 2017, it was Nicol given the job of leading the Respect and Inclusion project. That was despite Nicol being the rookie in an executive management team most of whom had been with NZ Rugby since the early 2000s.
Her task? Bringing a sport with a seriously macho culture into the #metoo age. Oh, and while you are at it, could you please work on reforming New Zealand itself?
As Tew said at the time the report was released: “In the long term, we will change the culture of the game in New Zealand. And given the influence we have in this country, [that means we will change] the whole society itself.”
“We had feedback from sponsors, partners and fans that we needed to do better. We had a bit of a buffer – people have a lot of goodwill towards the brand. But repeat incidents would have been challenging.”
Nicki Nicol, NZ Rugby
Nine months on, Nicol says Respect & Inclusion isn’t just touchy-feely stuff – although trying to produce societal change is part of what makes her job rewarding.
With her CFO hat on, she knows the organisation faces very real commercial risks if it can’t get its cultural house in order.
“We learned from 2016. We had feedback from sponsors, partners and fans that we needed to do better. We had a bit of a buffer – people have a lot of goodwill towards the brand. But repeat incidents would have been challenging.
“To keep the game sustainable we had to get on the front foot and we needed to be showing we were more progressive as an organisation.”
There are a few things that make NZ Rugby different – and which make keeping onside with your fans and sponsors pretty critical.
– “Lumpy profits”. The organisation creams it once every 12 years when the Lions tour New Zealand, and loses money during World Cup years. It’s very reliant on potentially fickle sponsorship, gate sales and TV rights. (See more about its scary revenue model here);
– A top-down funding model. In many other sports, players’ club fees feed into the financial structure, sometimes supporting the top teams. But in rugby, revenue from the elite teams – the All Blacks and the Sevens – basically fund the sport right down to grass roots level. That means any reputational damage at the top could have serious financial ramifications right down to the smallest rural club;
– A decline in the number of men playing the game, but double-digit growth over the last three years in women’s participation. There’s a real possibility that done right, women’s rugby could be a money-spinner in the future, but in the meantime there is a lot of work to be done. From making sure there are half-decent women’s changing rooms, to getting rid of sexist comments and behaviour from players and spectators, to improving the dire gender balance in management, to training up more female referees, to setting up a senior women’s competition that’s worth watching on TV.
“The women’s game has real commercial opportunities in the future, but big challenges.”
Because once women’s rugby gets on television, that’s when sponsors start getting excited.
Women on and off the field
“The women’s game has real commercial opportunities in the future, but big challenges,” Nicol says. “How do we come up with a competition at semi-professional or professional level? Do we have the depth of talent we need for that? How can we make sure we have a sustainable pathway?”
There are no targets, but Nicol hopes to see some sort of top women’s competition over the next two years, and women’s rugby paying its way over the next decade.
Still, she’s realistic that setting up a professional competition won’t be cheap. “Double-digit millions to do it properly, although there could be some hybrid middle ground.”
Then there’s the problem of getting diversity into leadership roles. NZ Rugby has only one woman on its board – former Black Fern Dr Farah Palmer. When she was elected in 2016, she took her place alongside eight white men, although the annual general meeting in April saw former deputy Labour leader Dame Annette King pitted against All Blacks legend Sir Michael Jones (who has Samoan heritage) for one elected position. Ethnic diversity won over gender diversity.
Nicol says 38 percent of applicants for the board post were women and she’d like to see a third of directors being women by 2025, as well as better representation from the Maori and Pacific Island communities. Of the provincial unions, 73 percent have at least one woman on the board, but only 12-15 percent of directors are female.
“We know diversity is good for business, and the Institute of Directors says you need at least two (women) on a board to make a difference.”
Meanwhile, NZ Rugby has just appointed a Maori cultural advisor, who starts his job today.
The risks are high. NZ Rugby has already invested half a million dollars in leadership development, including cultural competency. There’s a new, independent complaints management service which has so far received 30 or so complaints, many of them around inappropriate images on social media.
Vision and values
One of the biggest projects stemming from the respect and responsibility review panel involves developing vision and values, and injecting them into rugby. UK research suggests around 50 percent of employees don’t have a clue about their company’s vision or value statements. And that’s when they are being paid to care about them.
When you are working with 156,000 registered players from All Blacks to primary school rippa rugby teams, in big cities and seriously rural areas, that adds a whole new layer of complexity. Oh, and then there are coaches, referees, volunteers, and mums and dads on the sideline.
At least in the workplace you can ban alcohol.
Nicol says when NZ Rugby first commissioned the respect and responsibility review, they thought the main problems were with the professional players. But when they got the 34-page report, they recognised focusing on the top layer wouldn’t work. One of the problems highlighted by the report was “the stardom and sense of entitlement that you see in young players”, Kathryn Beck said at the time.
Nicol says NZ Rugby knew its solution had to be wider. “We realised that when players come into the professional system, a lot of ideas have already been formed. We needed an all-of-rugby approach.”
The first step was getting together a wide group of stakeholders – provincial referees, team managers, women’s 7s team players, All Blacks, 1st 15 captains. Hardened rugby guys some of them. They helped develop a charter, called “The Rugby Way”.
It’s early days rolling it out, Nicol says. And, like eating an elephant, it’s about taking it a little at a time. She says so far it hasn’t been too expensive, as it’s largely around investing in human resources and appealing to volunteers. There’s a lot of public goodwill towards rugby.
There’s also a team of people on hand whose job it is to persuade people to do things they might not necessarily want to do. They are called coaches.
NZ Rugby pulled in some of the big guns to help with the recent internal restructuring; they may need them even more for the roll-out of the vision and values.
So far, the sponsors seem to be on board. Earlier this year All Blacks/Black Ferns sponsor AIG collaborated on an anti-discrimination ad entitled Diversity is strength. Filmed in Japan, the two-minute commercial tear-jerker features slow-mo shots of striding rugby players, adoring fans, a cute black kid, a guy in a wheelchair, and players peeling back their shirts to reveal rainbow stripes. The voice-over is American. It’s over-the-top but might just work in xenophobically-challenged Japan.
Nicol says she’s also starting to see sponsors working together on NZ Rugby’s mental health campaigns.
Meanwhile, NZ Rugby is also investigating and developing other revenue streams. A shop at the airport, a rugby museum at SkyCity, e-sports, selling coaching programmes overseas. All of these things are a chance to leverage the brand and be more attractive to sponsors. Nicol would like to see alternative streams making up a double digit percentage part of NZ Rugby’s revenue in the future.
“If we get to generate more revenue, we get to do more things. It’s a hungry beast – many mouths to feed,” Nicol says.
With Michael Jones now on the board, there might also be a bit of praying going on. Like that the worst All Black scandal this year will be Jordie Barrett eating McDonald’s on some random stranger’s couch in a Dunedin flat in the middle of the night.