The Rugby Football Union’s controversial decision to award its chief executive Bill Sweeney a £358,000 bonus as part of a £1.4 million executive pay scheme has been deemed “appropriate and well-reasoned” by an independent review, despite the RFU posting a record £37.9 million operating loss for the 2023-24 financial year.
The review, conducted by legal firm Freshfields at the behest of the RFU, acknowledged certain failings in how the long-term incentive plan (LTIP) that enabled the hefty bonuses was communicated to stakeholders. But it ultimately concluded that the scheme itself was justified as a means to retain top talent and improve the organization’s financial and non-financial performance in the challenging post-COVID period.
Sweeney’s Pay Tops £1.1M as RFU Hemorrhages Cash
Sweeney’s total compensation for 2023-24 amounted to £1.1 million, comprised of a base salary of £742,000 and the £358,000 LTIP award. Five other executives also received bonuses totaling around £1 million through the scheme.
These lavish payouts coincided with an unprecedented £37.9 million operating loss reported by the RFU, which led to over 40 staff redundancies. The incongruity between the executive awards and the union’s financial plight ignited a firestorm of criticism from member clubs and rugby stakeholders.
“Given rugby’s current difficulties, no one should receive bonuses at the moment.”
– Patrick Delaney, Aylesford Bulls RUFC chairman
Review Backs Bonus Scheme But Faults Communication
Under mounting pressure, the RFU commissioned Freshfields to review the LTIP scheme. The firm’s report, released April 13, states that the plan was an “appropriate remuneration structure” given the RFU’s goals of improving post-COVID performance, retaining key executives, and navigating recruitment challenges.
However, Freshfields did identify “a marked lack of consideration given to communication with Council Members about the LTIP.” It noted insufficient detail in the RFU’s financial reporting and faulted a lack of robust discussion around the reputational risks of paying hefty bonuses amidst record losses and layoffs.
- Key Finding 1: The LTIP was appropriate given RFU’s circumstances and objectives
- Key Finding 2: Communication to RFU Council and stakeholders was inadequate
- Recommendation: Make executive remuneration policy public for transparency
RFU President: Report Will ‘Inform’ Governance Reforms
Reacting to the review, RFU President Rob Udwin expressed pleasure that the LTIP itself was deemed appropriate in design and implementation. He said the report’s findings and recommendations would feed into the union’s ongoing governance and communications reform processes.
“There are some specific recommendations and wider observations…on the communication routes between the Executive, Board, Council and wider game… It is important to recognise these, and they will feed into and inform the current Governance and Representation Review.”
– Rob Udwin, RFU President
Yet for many rugby stakeholders, the Freshfields review is too little, too late. Over 100 clubs and bodies have signed a letter demanding a special general meeting on March 27 to more thoroughly investigate the bonus scandal and address deeper issues in the RFU’s governance. It remains to be seen whether the independent findings will quell or further inflame that uprising.
As the world’s wealthiest rugby union grapples with a financial and governance crisis, all eyes will be on Twickenham to see if this controversial bonus scheme proves to be a catalyst for meaningful reform, or just one more flashpoint in a deepening divide between the RFU’s embattled leadership and the sport’s increasingly restive grassroots.
