ISE Chief: Ireland must learn corporate governance lessons

The Chief Executive of the Irish Stock Exchange Deirdre Somers has said that Ireland must learn the lessons of recent corporate governance failures in Ireland.

She also said that Irish-listed companies must meet evolving international market expectations if they are to attract international investment.

Ms Somers was speaking at a special Conference on Corporate Governance hosted by the Irish Stock Exchange in Dublin today.

She said: “Companies must consider whether their historical practices, although accepted in the past, will meet market expectations in the future.”

Ms Somers also said that investors had a particular responsibility in respect of publicly quoted companies.

She said they must "demand better standards and require better disclosure and then differentiate and penalise those companies that do not provide them".

Also at the Conference, the Chairman of the Stock Exchange, Padraic O’Connor, said that while most Irish listed companies complied closely with the Combined Code – a key guide for Corporate Governance issues for public companies – problems had arisen where some companies deviated from the principles of the code.

He cited in particular the deviation whereby the Chairman of a company was also Chief Executive or a former Chief Executive as an example.

O’Connor also warned against devolving responsibility for corporate governance issues solely to publicly listed companies.

He said: “Responsibility for Ireland’s international Corporate Governance reputation is not the sole responsibility of the 29 companies listed on the Irish Stock Exchange.

"The hundreds of thousands of privately owned companies and the numerous semi-State companies are equally responsible for ensuring our national reputation for probity and good Corporate Governance – and indeed many of the damaging revelations of recent years have arisen out of those sectors rather than amongst listed companies."

Finally O’Connor said that while the Combined Code was a key influence on Corporate Governance practices in listed companies, it was not a substitute for ethical behaviour, company law or sectoral regulation.

He also called on the Government to “lead by example” by ensuring that public sector companies adhered to the highest standards of Corporate Governance.