Nobody bats an eyelid at corporate governance anomalies in Ireland
Enduring laxity in such a crucial area likely to cost investors in the long run
Denis O’Brien: Independent News & Media chairman Leslie Buckley was anything but independent upon his appointment due to his links to O’Brien. Photograph: Collins Courts
For corporate Ireland, adhering to accepted norms of corporate governance is a little like washing your hands after using the bathroom: everybody knows they’re supposed to do it... but as long as nobody around them is paying too much attention, people don’t lose too much sleep if it doesn’t happen.
A report from shareholder advisory group, Pensions & Investment Research Consultants (Pirc), has recommended that investors vote against the re-election of several Ryanair directors.
Pirc argues that several non-executive members of the board, including the chairman David Bonderman, don’t meet the criteria for board independence due to their financial links to the company, or the length of their tenure.
But the reality is they’ll all be re-elected and nobody will bat an eyelid.
Oaktree and Bridgedale are lining up a listing for a new housing vehicle, Glenveagh. They have tapped for Nama executive John Mulcahy as chairman, but it appears he will be getting founder shares.
Under corporate governance best practice, a chairman should always be independent upon appointment. Is it possible that Mulcahy can be considered independent if he gets founder shares?
But Glenveagh will get its listing away and nobody will bat an eyelid.
Independent News & Media, whose two main shareholders are Ireland’s richest men – Denis O’Brien and Dermot Desmond – is a corporate governance cabaret show currently. There should be showgirls dancing around its boardroom.
Its chief executive, Robert Pitt, and its chairman, Leslie Buckley, are at war over Pitt’s concerns regarding corporate governance. But not one of the other independent directors has said a peep about the situation.
Contrary to governance guidelines, Buckley was also anything but independent upon his appointment due to his links to O’Brien. Nobody batted an eyelid.
Nobody ever bats an eyelid at corporate governance anomalies in Ireland. That is, until the proverbial hits the fan and coats all the investors, or damages the value of their investment.
Whenever trouble arrives, investors are suddenly able to rouse themselves and become concerned about the way their company is run.
But it is often too late by then.