Eriksson is still keen to continue as England coach and has the full backing of his players.
It would have been impossible for Eriksson to have continued to work with Palios after this latest crisis, but now the chief executive has fallen on his sword it could leave the way clear for the Swede to carry on.
Arsenal and England defender Ashley Cole today urged the FA not to get rid of Eriksson. He said: "We need stability. There is only one guy the players want and that is Sven.
"I think it is disappointing that all this is coming out about him. From the players' point of view, we want Sven to stay.
"He is a great manager. One to one he is a great guy: he is honest with the players and gets the best out of them.
"He gets the best out of me and a lot of the young players. Look at Wayne Rooney.
"He is always behind the players and that what you want from the manager."