Managers turn backs on board seats

GREATER demands on company directors are to blame for top business people turning their backs on board seats, according to a survey published yesterday.

The survey, conducted by Deloitte, found almost two-thirds of senior managers were more likely to turn down offers of non-executive positions than they were five years ago. Only seven per cent said they were more likely to accept.

"The reason why so many top business people are rejecting offers to become a director is the increased level of responsibility the position now involves," said Brendan Jennings, head of audit at Deloitte. "84% of respondents to our survey said that directors' responsibilities are substantially more onerous now than they were five years ago."

Company directors will soon face a new requirement to sign a statement that their companies have complied with tax and environmental laws as well as company-specific legislation. Almost three-quarters of respondents said they were well prepared to make such a statement, but one in three felt the new requirements were inappropriate.

Company directors have expressed concerns over being held responsible for putting their names to a statement that they believed to be true at the time of signing but which later turned out to be incorrect.

The survey was presented yesterday at a breakfast briefing on the role of company directors at Dublin's Westin Hotel. Speaking before the briefing, Senator Joe O'Toole, who chaired the Oireachtas review group on auditing, said directors needed to be aware their roles involved considerable responsibility.

Directors needed to earn their fees by working hard to be familiar with their companies' business and satisfying themselves that their companies complied with laws relevant to them, he said.

Anglo Irish Bank chief executive Sean FitzPatrick said misbehaving directors should be penalised and that businesses should get behind the Director of Corporate Enforcement in his efforts to apply the spirit of the law correctly.