Together, these companies employed 310,000 people and had a combined turnover (or equivalent) of nearly €80 billion. They included both private companies and state-owned bodies.

The 40 companies studied in this report are household names and include Bord Gáis, the Central Bank, AIB, Smurfit, Anglo Irish Bank, Ryanair and Aer Lingus. The total number of directors involved in managing these companies was 572.

In the period 2005-2007, a network of 39 people held positions in 33 of the 40 top private companies and state-owned bodies. Between them, these 39 – referred to as the Director Network in TASC’s report – held a total of 93 directorships.

Mapping the Golden Circle also provides evidence that there was a trend of “excessive remuneration” for the CEOs of both state-owned and private companies. On average, their pay rose by over 40% between 2005 and 2007, while combined inflation for these two years ran at just over 9%.
TASC director and co-author of the report Paula Clancy said today:

“The economic crisis has rightly focused attention on how we run our businesses. Corporate governance is at risk when people are overextended. Mapping the Golden Circle shows where the risk of overextension lies. We know too that when people know each other very well and share similar backgrounds, as many in the Director Network do, companies run the risk of ‘groupthink’, where decisions are made that ignore alternative evidence as a result of a group’s desire to reach consensus.”

Ms Clancy said that this piece of research should be used to pave the way for improved corporate governance in the future:

“Ireland now needs a new statutory basis for corporate governance. This could include substantially restricting the number of directorships an individual can hold, reducing or eliminating cross-directorships and introducing a quota to increase the number of women sitting on boards. The issue of pay and its potential to compromise decision-taking must also be examined. It is vital for the future that the public interest be rigorously safeguarded in state-owned bodies and private companies which play key roles in the Irish economy. This can only be achieved by strengthening the rules and regulations governing how business is conducted”, Ms. Clancy concluded.