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In one of his first interviews as Rugby Australia chairman, Hamish McLennan made a couple of statements that, in retrospect, are illuminating.<\/p>\n
The first was that \u201cDave Rennie is going to be a fantastic coach for us\u201d. \u201cHe\u2019s very calm,\u201d McLennan told Sky Sport New Zealand three years ago. \u201cHe\u2019s a grown-up.\u201d<\/p>\n
The second was that RA had found itself in a position \u201c10 years in the making\u201d. \u201cI don\u2019t want to name names,\u201d he said, \u201cbut I think the administration\u2019s had some issues in the past … I thought that, with my skill set and what I\u2019ve done in the past, I could help.\u201d<\/p>\n
To the first point, we know the post-script: McLennan sacked the grown-up and replaced him with Eddie Jones, who has overseen the Wallabies\u2019 most diabolical Rugby World Cup campaign to date.<\/p>\n
The second remains the one in question: has McLennan helped Australian rugby and is the skill set he speaks of suitable to help it in the future?<\/p>\n
The answer depends very much upon whom you ask. Few figures elicit such a diversity of opinion as the high-flying media and advertising executive. Those in rugby who love him are happy to sing their support from rooftops. Those who do not are often reluctant to go on the record. Some are unwilling to speak even off the record.<\/p>\n
Polarising, in and of itself, is not necessarily a negative trait in a leader if tough decisions must be made. It becomes an issue if the people being polarised are the ones who need to work cohesively to rescue a code on the precipice of apparent doom.<\/p>\n
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Rugby Australia CEO Phil Waugh, left, and chairman Hamish McLennan at Allianz Stadium in Sydney.<\/span>Credit: <\/span>James Brickwood<\/cite><\/p>\n At the time of McLennan\u2019s appointment in June 2020, rugby \u2013 like every other professional sport \u2013 was ravaged by COVID-19. Raelene Castle had just been manoeuvred out of her role as RA chief executive in ugly circumstances and director Peter Wiggs had also resigned.<\/p>\n With no broadcast deal, no product to sell and wages still to pay, insolvency was a prospect. But it wasn\u2019t just that; rugby was on the verge of death by irrelevance. Next to no one wanted a piece of Super Rugby and \u201cThe Hammer\u201d McLennan was seen as the great \u201creset\u201d, according to his predecessor and former Australian captain Paul McLean.<\/p>\n McLennan, a former Network 10 and News Corporation executive saw himself that way, too, and was happy to spruik himself as the vessel for salvation. That was, in part, what made him successful.<\/p>\n As he and interim chief executive Rob Clarke took drastic steps to keep the code solvent, grow the broadcast pie with Nine and its streaming service Stan and win hosting rights for the 2027 men\u2019s and 2029 women\u2019s World Cups, McLennan ensured \u2013 through the loudness of his own voice \u2013 that rivals knew Australian rugby had something to say.<\/p>\n \u201cI was asked to walk in as chair three years ago when nobody else really wanted to and the board has done a remarkable job keeping the game alive, which will be crowned by us hosting the men\u2019s and women\u2019s World Cups in \u201927 and \u201929,\u201d McLennan said on Friday.<\/p>\n \u201cThese monumental achievements will save the game. I\u2019ve been saying for three years the game needs constitutional change and centralisation. That is absolutely the right strategy and the member unions and Super Rugby clubs need to agree to this massive overhaul, or we\u2019ll keep getting the same results.<\/p>\n \u201cPerhaps that\u2019s why we haven\u2019t won a Bledisloe in over 20 years and our results keep going backwards. If there\u2019s further churn at the top of rugby, I think that will be far more detrimental to the game and I think that will cause a greater loss of revenue and instability, which will only benefit our competitors. Our enemies and the NRL don\u2019t want rugby to succeed and a resurgent RA is not good for their business. I know I irritate them.\u201d<\/p>\n The NRL and New Zealand Rugby were the central targets, and both were \u2013 and are \u2013 goaded relentlessly. On the one hand, this type of single-mindedness was brilliant for a sport in sore need of publicity. On the other, he was reaching beyond his remit of chairman and putting some of his own people offside.<\/p>\n Descriptions of McLennan by various sources include \u201caggressive\u201d, \u201cambitious\u201d, \u201ctone deaf\u201d, \u201clikeable\u201d and \u201cimpossible to work with\u201d. He manages up but not down, has a propensity to light fires and then expects others to put them out and likes \u201cto control everything\u201d in a manner more befitting a chief executive than a chairman.<\/p>\n When McLennan encountered a strong-minded chief executive in Andy Marinos (who declined to comment for this article), they clashed and Marinos departed and was replaced with 79-Test veteran and RA director, Phil Waugh.<\/p>\n One of the major points of difference was the $5 million acquisition of Joseph Suaalii, which accompanied a diverting war of words with Australian Rugby League Commission chairman, Peter V\u2019landys, who he said was having a \u201csqueal\u201d because rugby is raiding his talent.<\/p>\n The other was the sacking of Rennie and wooing of Jones. According to multiple sources who spoke with this masthead, McLennan did the deal and it was subsequently approved by his board. McLennan denies this is how it happened.<\/p>\n \u201cEddie wasn\u2019t a captain\u2019s call and it went to the Rugby Committee and full board,\u201d McLennan said. \u201cI absolutely raised Eddie as an option when he got cut and negotiated his contract but the whole board had been concerned about the coaching and team\u2019s performance for some time.<\/p>\n \u201cPerhaps Eddie is a great coach operating in a dysfunctional system. If Steve Hansen and others think he\u2019s the real deal, maybe we need to give him time and resources. He\u2019s got three different teams to three World Cup finals, which is a stunning achievement for any global coach.\u201d<\/p>\n For many surrounding McLennan, the general consensus is that, on matters pertaining to Eddie, he has a blind spot. In January, at Jones\u2019s welcome home press conference, the chairman joked the returning coach could have \u201cwhatever he wants\u201d. Jones went on to dismiss Rennie\u2019s backroom staff, select one of the least experienced World Cup squads known to man and secretly interviewed for the Japan job days before the ill-fated tournament kicked off.<\/p>\n \u201cThe nature of captain\u2019s picks is that you live and die by those decisions,\u201d says Hunter Fujak, a lecturer in sports management at Deakin University and the author of Code Wars<\/i>. \u201cIn this case, it certainly hasn\u2019t looked like it\u2019s worked out thus far [with Eddie Jones]. Obviously, we\u2019re only a year into a five-year contract with Jones.\u201d<\/p>\n Since the historic 40-6 loss to Wales, fingers have been pointed at Jones. By extension, they have also been pointed at McLennan. All Blacks great Andrew Mehrtens was among them, lamenting a \u201clack of humility\u201d from senior RA figures.<\/p>\n \u201c[It is about] acknowledging mistakes and moving forward and if that means there has to be some blood spilled at the highest level, well there has to be blood spilled,\u201d Mehrtens said.<\/p>\n McLennan himself this week told this masthead he holds himself \u201cfully accountable\u201d for his decisions. \u201cIf I am part of the solution, or not, I will live with that.\u201d<\/p>\n He walked back those words on Friday. \u201cSenior World Rugby officials have privately said to me, we need to restructure our organisation,\u201d McLennan said. \u201cThe messages of support for myself and the need to drive this systemic change through have been overwhelming.<\/p>\n \u201cMy comments to Iain Payten were reflective of my acknowledgment that I am answerable to my stakeholders, but I\u2019m not looking to jump ship when the going gets tough. If it all ended tomorrow, I leave knowing I gave my RA salary back to women\u2019s and Indigenous rugby. I have an awesome wife, kids and friends, and we\u2019ll all go and sit on a boat somewhere and have a laugh.\u201d<\/p>\n Rugby Australia chairman Hamish McLennan, Eddie Jones and former Rugby Australia chief executive Andy Marinos in January after Jones was appointed.<\/span>Credit: <\/span>Getty<\/cite><\/p>\n Phil Kearns, the former Wallabies captain who is on the board of the World Cup organising committee, was quick to defend McLennan\u2019s capacity to navigate the code through a storm.<\/p>\n \u201cIf everyone\u2019s just pointing the bone at Hamish, there are a few other bones that should be pointed back through history of the last 15 years because certainly Hamish didn\u2019t create the on-field performance,\u201d Kearns said. \u201cI think if one thing comes out of this [it\u2019s that] rugby administration and coaching and development is centralised in this country.<\/p>\n \u201cWe\u2019ve seen what it\u2019s done for New Zealand. We\u2019ve seen what it\u2019s done for Ireland and Scotland. It\u2019s a model that works. And unfortunately the provinces might need to pull their heads in and do what\u2019s best for Australian rugby, not what\u2019s just best for their own province.\u201d<\/p>\n This, really, is the sticking point: will the member unions unite under McLennan in the push towards a centralised governance structure?<\/p>\n For more than a decade Australian rugby has agitated for constitutional reform, away from the federated model in which member unions have a powerful say and compete for player talent, coaches and resources.<\/p>\n The deteriorating financial position of some has left them with little choice in the matter and, weeks before the World Cup, RA announced it had an in-principle agreement on an aligned national high-performance model.<\/p>\n But there is even less trust than there is money, and pressure is mounting on the governing body to prove, amid the rabble, that its senior figures are still fit for purpose.<\/p>\n \u201cClearly, we\u2019re suffering from poor results at the moment, and that impacts the revenue line,\u201d RA chief executive Phil Waugh said. \u201cA more centralised professional environment leads to better results.\u201d<\/p>\n While McLennan has been criticised for hiring of Jones, and the Wallabies\u2019 poor performance, he has led a turnaround in the organisation\u2019s financial performance. Last year, RA reported an operating profit of $8.2 million, compared with a $4.5 million loss the previous year.<\/p>\n For the past year, RA had been in discussions with private equity groups and investors who were interested in taking a stake in the organisation, but Waugh said that was now not an option to raise money in the short term.<\/p>\n \u201cWe\u2019re going down the debt path and pausing the private equity process for the time being,\u201d Waugh said. \u201cIt\u2019s not because there was a lack of interest from private equity partners. But given the revenue events we have coming with the Lions tour in \u201925, and the \u201927 and \u201929 World Cups, if we take additional debt now, then that sets us up to get the system in place to hopefully turn the poor performances into good performances.\u201d<\/p>\n This November, RA is expected to finalise a new funding arrangement, with the troubled sporting organisation expected to secure lending in excess of $40 million. A new debt facility would replace RA\u2019s existing $40 million loan with Ares Management that it took out in May 2021, during the pandemic, and on which it is paying a hefty interest rate of 11 per cent.<\/p>\n Waugh said the group would borrow more than $40 million but declined to state an exact figure. He said it would be used to pay off the Ares debt, replacing it with a new loan at a lower interest rate.<\/p>\n RA had been in previous discussions with private equity and investment groups, Silver Lake, CVC Capital Partners and Andrew and Nicola Forrest\u2019s Tattarang, which also funds the Perth-based Super Rugby franchise, Western Force.<\/p>\n The additional funding will allow RA to restructure and grow the game from the grassroots to the national competition. Tattarang has not responded to multiple requests to confirm whether it is involved in the current debt funding deal that RA is negotiating.<\/p>\n Last year, New Zealand Rugby sold a 6 per cent stake in its revenue-generating assets for $NZ200 million ($186 million), valuing the organisation overall at $NZ3.5 billion. It sparked hope that a similar deal could be struck at RA.<\/p>\n Waugh said a debt deal should be finalised by mid-November. \u201cWe\u2019re running pretty hard at it. We\u2019re just working through what\u2019s the appropriate number. It\u2019ll be north of $40 million, so we\u2019ve got some flexibility if the appropriate investments or opportunities come up.\u201d<\/p>\n RA\u2019s loan with Ares would have been repayable at the end of March 2027, almost six months before Australia hosts the men\u2019s World Cup, adding to the pressures on the board and management.<\/p>\n Wallabies teammates console each other after the Wales defeat.<\/span>Credit: <\/span>AP<\/cite><\/p>\n In RA\u2019s 2022 financial accounts, the organisation\u2019s then nine directors were paid a total of $883,450 including super and there was a $100,000 incentive payment though it doesn\u2019t specify the recipient.<\/p>\n The accounts disclose that $140,000 of directors\u2019 salaries were donated to the Australian Rugby Foundation and a further $20,000 to other rugby related charities.<\/p>\n The board now has eight directors, most of whom have joined since McLennan\u2019s appointment. The longest-serving is former Salesforce boss Pip Marlow, who has held her position for seven years.<\/p>\n Separately, RA has to pay interest at the end of this year on \u00a35.5 million ($10.5 million) of advanced funding that it received from World Rugby. The interest bill is estimated to be $630,000.<\/p>\n Businessman Rod Eddington is the chair of the men\u2019s and women\u2019s Rugby World Cups in 2027 and 2029 respectively. He declined to comment on the Wallabies\u2019 disastrous showing in France and its effect on the game\u2019s popularity and organisation\u2019s profitability \u2013 or the next World Cups. \u201cMy focus is making sure \u201927 and \u201929 work well for everyone,\u201d he said.<\/p>\n RA received two federal government grants from the Department of Health, for its men\u2019s Rugby World Cup bid, which were estimated to tally $5.2 million.<\/p>\n In 2022, RA received almost $50 million in revenue from its broadcast rights deals. The next biggest earner for the organisation was match revenue, of $37.8 million. From sponsorship agreements, it received $29 million.<\/p>\n \u201cWe\u2019ve got a broadcast arrangement that finishes at the end of \u201925,\u201d said Waugh. \u201cWe are certainly hopeful that we get some momentum in performance to increase that broadcast deal from \u201926.\u201d<\/p>\n Nine Entertainment Company, publisher of this masthead, has the television rights to Wallabies Tests and Super Rugby until the end of 2025, as part of a $30-million-per-year deal struck in 2020.<\/p>\n In addition to questions about whether McLennan should remain as RA\u2019s chair, there are also concerns that he\u2019s spread too thinly with his work commitments.<\/p>\n On top of chairing RA, he chairs the publicly listed REA Group, an online property company controlled by News Corporation. Last year, he also stepped up to become chair of another public company, Magellan Financial Group, after its poor performance led to the exit of its co-founder Hamish Douglass.<\/p>\n Magellan\u2019s profit fell almost 60 per cent and its funds were down by just over one-third in its 2023 financial year. Last month, McLennan said he would become deputy chair, making way for Andrew Formica, a veteran of the funds management industry, to succeed him as chair.<\/p>\n McLennan\u2019s other roles also include being chair of ARN Media, a media and entertainment business and a director of gambling products and services company Light & Wonder.<\/p>\n Earlier in his career, McLennan was chairman and chief executive of global advertising group Young & Rubicam. He\u2019s also worked as an executive vice president in the Office of the Chairman at News Corporation, reporting directly to Rupert Murdoch. He was also Network 10\u2019s chief executive for two years, where he managed to stabilise the television group\u2019s ratings.<\/p>\n Whether McLennan stays as chair of RA will depend on the outcome of the post-World Cup review foreshadowed by Waugh.<\/p>\n The Wallabies play Portugal in the early hours of Monday morning and, while they are not yet ruled out, progression to the quarter-finals is a mathematical possibility only.<\/p>\n \u201cClearly, performance isn\u2019t where it needs to be,\u201d said Waugh. \u201cIt\u2019s disappointing and challenging. It\u2019s why we need to have systemic change across the system, so we set the professional teams up for success. But equally we need to focus appropriately on community and participation because that\u2019s where our next Wallabies and Wallaroos are coming from.\u201d<\/p>\n News, results and expert analysis from the weekend of sport sent every Monday. <\/i><\/b>Sign up for our Sport newsletter<\/i><\/b>.<\/i><\/b><\/p>\n Source: Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<\/p>\n
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