Corporate governance code compliance falls

THE number of publicly quoted companies fully complying with the combined code on corporate governance has fallen nearly 20% in the last 12 months to 36%.

The numbers showed 36% of Irish-quoted companies are fully complying with the code, down from 51% a year before. The figures are based on business consultancy giant Grant Thornton’s latest annual corporate governance survey. The survey questioned 36 companies (against 39 previously) and was done in the final quarter of last year.

However, despite conceding that compliance levels are now dropping on an annual basis and need to improve, Grant Thornton Ireland said the main issue is not so much if a company is technically fully complying with the code, but how clear and transparent they are in disclosing information to shareholders.

On that basis, the survey suggests that things are improving.

“Overall, the greater transparency is in itself an improvement, but our work shows that more needs to be done to provide a unified framework for companies to follow with proper enforcement for non-compliance. The most significant theme in this year’s report is that companies are being more transparent and are giving better information,” said Grant Thornton Ireland managing partner Paul Raleigh.

While calls have been made for mandatory full compliance Grant Thornton is calling for stronger boards of directors as a key move.