An independent review of the Rugby Football Union's controversial scheme that handed CEO Bill Sweeney a £358,000 ($448,681) bonus found that it was "appropriate and well-reasoned."
However, the review did also identify some key failings, largely in terms of communication.
Sweeney was paid £1.1 million for the 2023‑24 financial year, comprising an increased salary of £742,000 on top of the figure awarded via a long-term incentive bonus (LTIP).
Further bonuses totalling around a £1m were paid to five other executives even though the RFU reported a record operating loss of £37.9 m and made more than 40 members of staff redundant.
The figures caused uproar throughout the game and the RFU will now hold a special general meeting on March 27, after more than 100 clubs and other bodies signed a letter demanding it.
The governing body employed legal firm Freshfields to review the LTIP plan and though it said several areas that caused consternation in the game were beyond its remit, it broadly recognised that the scheme was similar in scope to plans used in other organisations as a tool to keep executive staff on board.
"In our view the LTIP was an appropriate remuneration structure for the RFU to introduce in 2021, given the RFU's objectives at that time," the report, released by the RFU on Thursday, said.
"Those objectives included (i) improving the RFU's performance (both financial and non-financial) following the challenging COVID period, (ii) retaining the existing team of executives who were needed to achieve such improved performance, and (iii) anticipating the challenges the RFU would likely face in recruiting talent."
The report, however, was critical of how the RFU communicated with its council and other stakeholders, both about the provision of the scheme and the metrics its recipients would be measured against to determine how much money they would receive.
"The lack of awareness of the key details of the LTIP on the part of Council Members demonstrates that there was a marked lack of consideration given to communication with Council Members about the LTIP and the consequent furore that might ensue once details of the payments were finalised," the report said.
"Furthermore, while the RFU's Annual Reports during the relevant period contained basic information on the LTIP, we have found the level of detail provided in those reports to be insufficient."
Freshfields said it had come across concerns about the potential reputational damage such payments might cause, particularly when paired with the RFU's record loss, announced last November.
"It is unclear from the minutes how robust these discussions were, and whether concerns raised were sufficiently considered and responded to," the report said.
"For example, it is not clear how much consideration was given to potential exercise of discretion to reduce/defer/not make payments before deciding that it would not be appropriate."
Freshfields recommended that the "RFU Executive Remuneration Policy should be made public to provide greater transparency and accountability, and enable the public and stakeholders to have a realistic understanding of the standards by which remuneration is governed and set."
RFU President Rob Udwin said: "We are pleased the report recognised the design and implementation of an LTIP and its vesting were appropriate in the circumstances.
"There are some specific recommendations and wider observations on the governance structure, the roles of Council Members on the Board and Committees, and 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, and the Communications Review that was agreed with Council in December.
"The review also suggested there could have been further disclosure in the annual report and accounts on the LTIP; this point is noted."
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