Mapping the Golden Circle?

Mapping the Golden Circle

TASC has just carried out some very important and significant research into a small select group of people who have held directorships on both private and state-owned bodies in Ireland over the last few years.

The research involved 40 companies, many of them household names and included 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.

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