Seanad debates

Wednesday, 13 May 2009

Corporate Governance: Motion

 

6:00 pm

Photo of Feargal QuinnFeargal Quinn (Independent)

I would welcome a debate on the whole question of corporate governance. We need to be very careful we do not go too far the other way. I found myself speaking in different countries over the last few years about the wonderful success of Ireland, but that success was clearly due to a number of factors, including our investment in education, our tax policy, our involvement in Europe and our investment in what I call the sunrise industries. It was also due to the fact we had a Government policy of making ourselves attractive to investors. If we go to such pains to protect investors and to protect customers to that extent, we must remember those who invest must take some care themselves. I have some worry about putting in such red tape and strict controls that will make it less attractive for investors in this country. I would be loathe to go too far along the road of saying we must protect everybody and we must have so many regulations for that. We were attractive because we gave freedom to institutions, even if we have had some problems with them recently. Let us not bend over backwards and make a mistake the other way round.

I would be very careful about how we place restrictions on the area of appointments to State boards. If we had examined appointees to the extent they had to go through committees and be cross-examined, as happens in the US, we would not have got some of those people who have been willing to give their time to a State board and offer to help. Those who have done that - we picked the best - would not have wanted to go through a grilling by Members of the Oireachtas before getting the nod. I am not sure of the answer, but if we are to attract people onto State boards, we must attract the best.

On the other hand, I welcome the suggestion to regulate political lobbyists. It is an idea which has been recently taken up in Europe. The European Commission has set up a lobbying register, the Register of Interest Representatives, which lists the names of organisations that attempt to influence European legislation, their stated aims and funding sources amongst other details. In a proposal I put for the reform of the Seanad, I suggested all lobbyists should be registered and all lobbying should be open and done here in this House. It is dangerous to have lobbyists who are not recognised as such and who are expressing an opinion when they are not known to be lobbyists by those opposed to that opinion. It would be much healthier to have it done openly.

There have been problems with the register because it is voluntary. This means that lobbyists in Brussels, who number about 15,000, do not have to sign up if they do not wish to do so and only about 9% of lobbyists have registered so far. However, the register is growing all the time and there are about 1,500 groups registered as of this week. The intention is that the register will become compulsory in the coming months. It is also envisioned that the register will require consultancies and law firms to declare their "turnover attributable to lobbying the EU institutions" alongside the "relative weight of their major clients," while inhouse lobbyists and trade associations will need to provide an "estimate of the costs associated with direct lobbying" in this regard. NGOs and think-tanks will have to publish their overall budgets and a "breakdown" of their main sources of funding. All these quotes are taken from the register's website.

A similar register could be implemented here. It would be on a much smaller scale so may be easier to do. The problems associated with the introduction of the register in Brussels should demonstrate the way to introduce a better system in Ireland and we must have a proper debate on a lobby register being introduced. It is worthy to bring up the issue in this motion, and I am delighted that has been done.

The other major issue is whistle-blowing legislation. We need a different approach to whistle blowing or what is also known as "good faith reporting" in the public interest. Perhaps it is an un-lrish thing to do, but the behaviour of some of those in the Irish banking system needed to be shown-up earlier. We need to afford whistleblowers more protection and commend them for their civic contribution rather than ostracise them as "informers". There are people within the banks who knew of malpractices that were happening but were too scared to come forward. In particular, employees may come across insider or fraudulent dealing, or falsified or misstated company accounts. The public interest would therefore benefit greatly from such disclosures.

We need whistle-blowing legislation more than ever. Mr. Tony Spollen, who exposed the DIRT scandal at AIB ten years ago, was a good example of the sort of white knight we need. It was a brave thing to do and there are numerous examples of other brave Irish whistleblowers. Fr. Gerard McGinnity was removed as senior dean at Saint Patrick's College in Maynooth in 1984 when he tried to draw the attention of the bishop trustees to seminarians' concerns about the behaviour of the then college vice-president. Ms Susan O'Keeffe was charged with contempt of court for refusing to name her sources to the beef tribunal following her 1991 "World in Action" documentary. Ms Sheenagh McMahon experienced devastating personal repercussions when she revealed in 1999 that her husband, Detective Garda Noel McMahon, had planted home-made explosives, later claiming them as significant IRA explosives finds. This led to the establishment of the Morris tribunal.

In her 2006 Lourdes Hospital inquiry report, Judge Maureen Harding Clark noted the resentment towards the four nurses who exposed the systemic wrongs in Drogheda: "We heard of comments to the effect that the whistleblowers would never get a job in Ireland, that they would be sued for defamation and would generally come to a bad end." Judge Harding Clark listed 11 categories of people who did not complain about Dr. Neary's actions and remarked that "No one made a formal complaint and no one questioned him openly". It is almost ten years since Deputy Pat Rabbitte introduced in the Dáil a Private Members' Bill entitled the Whistleblowers Protection Bill 1999. The Government, in March 2006, said it would not proceed with a general legislative proposal although it has introduced certain whistleblowing provisions in limited areas such as the legislation governing child abuse, consumer protection, some competitive issues, ethics in public office and in respect of the Garda Síochána. Employees should be able to reveal valuable information about their companies on ethical dealings without having to suffer negative consequences. The Government appears reluctant to introduce adequate legislation in this regard. I mentioned those areas because the issue of whistleblowing is one in respect of which we need some form of legislation. As I said, it is regarded as a non-Irish thing to do. However, I urge the Minister of State to take on board the intent of the motion.

While I do not support the motion as a whole, I support the general theme, direction and intention of what it seeks to achieve. I urge the Minister of State in his reply to give some indication that the Government will recognise that part of this motion deserves serious attention.

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