Couldn't spot anything obvious in the Operations Manual, but then it's stuffed full of random information and very difficult to use.
I was looking at
this page on the INZ site and was struck by the
Evidence of where family members live lawfully and permanently can be originals or certified copies of.... bit. I really don't know how far INZ would push it to get your brother to prove that he was intending to stay permanently in NZ or whether they would only pursue your parents, being the original principal applicants. Maybe his having NZ residency alone would satisfy them in this case.
I think maybe a call or email to INZ would be in order to sort this issue out.