Succession planning or disloyalty?

Dave Rennie, a rugby coach from New Zealand, has just been appointed as coach of the Australian national team, the Wallabies. This appointment has raised eyebrows, not only because of the passport the appointee carries, but because of the appointment process. 

It turns out the Rugby Australia had been speaking with Rennie for six months prior to the appointment being announced. Superficially, this appears to have been a smart move on Rugby Australia's part; a succession planning exemplar. But was it, or was it an act of disloyalty against the incumbent, Michael Cheika? The incumbent only made his intentions clear during rugby's showpiece, the Rugby World Cup, vowing to resign if the Wallabies did not win the William Webb Ellis Cup. Cheika and Raelene Castle, chief executive of Rugby Australia, were hardly the best of buddies, for sure. But when does strength in leadership (Castle has form) cross the line, becoming bullying?

This case exposes an interesting dilemma for boards of directors. When does the board's duty of loyalty to the incumbent chief executive cease? Is it reasonable, for example, to publicly support the incumbent while also scheming in the shadows to replace him or her? If the board finds itself in a position of lacking confidence in the chief executive (regardless of the reason), it owes a moral duty to both the chief executive and the organisation for which it is responsible to act both swiftly and with integrity. Rugby Australia appears to have done neither. While Castle probably operated within the law (she is on record as saying that formal contract negotiations did not take place until after the Rugby World Cup), the moral high ground was forfeited long ago. And that, sadly, places both Castle and the Rugby Australia in a rather awkward position.