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The University of Otago has rejected suggestions of a conflict of interest over sponsoring the Highlanders after revelations the club's former chairman was on a three-person committee which approved the deal.
This comes after the Sunday Star Times revealed the contentious decision to sponsor the team was made by the council's three-person standing committee.
The committee includes chancellor John Ward and pro-chancellor Stuart McLauchlan, who both have links to Dunedin rugby, and vice-chancellor Prof Harlene Hayne.
Mr McLauchlan was chairman of the Highlanders from 2004-09 and Mr Ward was a former trustee of the Carisbrook Stadium Charitable Trust, which was set up to build a new stadium.
This has come in for criticism from the Tertiary Education Union, Otago University organiser Shaun Scott saying it created a ''perception'' issue.
''That, in itself, is a reason that it would have seemed to be more appropriate for [the full] council to make the decision.''
A university spokeswoman this week said it was ''important to note'' Mr Ward resigned from the Carisbrook Stadium Charitable Trust in 2009 and Mr McLauchlan left the Highlanders board in the same year.
''Neither has had involvement or dealings with either of those organisations since that time, and when the decision to sponsor the Highlanders was made ... no conflict of interest arose.''
The decision was made after marketing and communications division director Virginia Nicholls assessed the benefits it would bring to the university.
It was within Prof Hayne's powers to make the decision herself.
''However, given the new nature of the sponsorship she felt it helpful to consult with council's standing committee.''
It could not be referred to the full council as a decision had to be made by the end of January ahead of its first meeting on February 25.
The university was happy with the way the sponsorship deal was going.
''The team is receiving good coverage and it is particularly pleasing to be supporting a team that has improved so greatly.''