sorry am I missing the point here or is this an issue of how is someone qualified to bestow a rank/grade, which they themselves have not obtained? If this instructor is a Shodan in Aikido and has promoted a student to Nidan in Aikido how is this possible? I don't understand how that would work? No matter how much experience this person has (he may well be at a Nidan level himself in experience), if he has not graded and gone through this process himself and passed having demonstrated he has clearly achieved the rank, how can he be qualified to judge and therefore grade accurately and correctly?
In the Aikikai, at least, I would say that the mechanism is that the instructors don't really promote people.
No instructor in the Aikikai has the authority to promote their students - not Yamada, not Saotome, not Chiba, not Hiroshi Tada.
Every instructor in the Aikikai recommends
for promotion - the actual promotion itself comes from Doshu and Doshu alone.
Of course, Doshu has no idea who most of these people are...