The Irish Stock Exchange (ISE) and the Irish Association of Investment Managers (IAIM) have jointly issued a report on compliance by Irish listed companies with the Combined Code. The report represents the findings of a review conducted by an independent researcher, of the extent of compliance by Irish listed companies with the Combined Code on corporate governance, and a qualitative assessment of their related disclosures.

Key Observations

  • There was a high level of compliance by Irish listed companies with the Code during the financial year 2008. The report noted that come companies have voluntarily adopted good governance practices beyond those required by the Code;
  • Further steps could be taken by boards to enhance the quality/meaningfulness/usefulness of disclosures contained in the annual report to investors;
  • The report noted that directors of listed companies appreciate the value of high governance standards; and
  • Companies should place more emphasis on disclosure in certain areas, including directors' remuneration, the rationale for the appointment of particular non-executive directors and the principal risks facing the business and how these are being dealt with.

Recommendations

  • The report recommended that companies use their annual report to demonstrate governance culture, processes and procedures within the company to deliver the spirit as well as the letter of the Combined Code;
  • Boards should embrace confident and persuasive communications with shareholders and avoid boiler-plate / uninformative descriptions and explanations;
  • Governance disclosures in the annual report should accurately reflect and be supported by the underlying behaviour of the board; and
  • The report makes a number of specific recommendations such as explanations for divergence from the Code's provisions, board balance, and board refreshment and performance evaluations.

To access the report click below:

Report on Compliance with the Combined Code (0.56 MB, Adobe PDF)