When co-principalships were initiated in Aotearoa/New Zealand during the 1990s, they encountered a range of issues around this country's new public management requirements for market, managerial and split governance/management accountabilities. This article draws on a case study of one initiative to discuss how elements of these requirements were variously challenged and co-opted by three teaching co-principals and their board of trustees. They established in their small primary school inclusive practices of shared leadership and mutual responsibility that took account of ethical and moral issues overlooked in the NZNPM discourse. The article endorses warnings that ethical forms of professional collegiality and trusting relationships, which have been found to be important in the development of effective teaching and learning environments, can be constrained by managerial surveillance and market mechanisms for accountability. (Contains 2 notes.)