Michael McGrath (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

353. To ask the Minister for Finance his views on persons holding multiple directorships of financial institutions; his further views that a limit should apply; and if he will make a statement on the matter. [31495/15]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

As Minister for Finance, I was actively involved in the negotiation and agreement of the Capital Requirements Division IV (CRD IV), which set limits on persons holding multiple directorships of financial institutions. Article 91(3) CRD IV establishes limits to the number and nature of directorships for members of the management bodies of financial institutions that are considered significant in terms of their size, internal organisation and the nature, scope and complexity of their activities. The European Union (Capital Requirements) Regulations 2014 () transpose the provisions of CRD IV into  national law. Regulation 79(7) of those regulations provides that, from 1 July 2014, members of the management bodies of institutions designated as significant, must not hold directorships amounting to more than one of the following combinations: a) One executive directorship with two non-executive directorships; b) Four non-executive directorships.

Prior to these Regulations, the Government actively rotated the directors of the State owned financial institutions and also selected candidates with the abilities, experience and time to properly carry out their roles as non-executive directors of these institutions.

In terms of other financial institutions, I support the Central Bank's statutory Corporate Governance Code for Credit Institutions and Insurance Undertakings and Corporate Governance Code for Captive Insurance and Captive Reinsurance Undertakings that sets out the requirements in relation to the appointment of directors. For Credit Unions, the Credit Union Handbook contains governance expectations.

In addition, the Central Bank recently undertook a thematic review which examined directorships held by individuals on the boards of corporate investment funds, fund management companies and AIF management companies. The Central Bank subsequently published guidance to assist Chairs, boards and individual directors in assessing the time commitment required for individual directors to fulfil their roles. The Central Bank continues to keep this matter under review.