Code of Practice for the Governanace of State Bodies
In June 2009, the Department of Finance issued a revised Code of Practice for the Governance of State Bodies (http://www.finance.gov.ie/documents/guidelines/codepractstatebod09.pdf) with which Bord Gáis Éireann is required to comply.
Well established processes are embedded within the organisation to comply with the existing key provisions which include:
• A requirement for written Codes of Conduct for directors and employees.
• A written constitution and responsibilities of the Internal Audit function.
• Compliance with national and EU tendering and procurement procedures.
• Procedures in respect of the disposal of assets or access to assets by third parties for commercial arrangements.
• Prior written approval of the Minister for Communications, Energy and Natural Resources (the "Minister") for any intended action, which would extend or change significantly the nature, scope or scale of current business activities.
• Prior written approval of the Minister and the Minister for Finance for establishment or acquisition of subsidiaries, participation in joint ventures and the acquisition of shares.
• Adherence to the guidelines for the appraisal and management of capital expenditure proposals as issued by the Department of Finance in January 2005.
• Implementation of Government policy on the remuneration of the Chief Executive.
• Delivery of interim half year unaudited accounts to the Department of Communications, Energy and Natural Resources (the "Department") within two months of half-year end. The Annual Report and Accounts should be published not later than four months after the year-end. Also, the Chairman must furnish separately to the Minister, with the Annual Report and Accounts, a comprehensive report covering the company’s business activities.
• Chairpersons of each subsidiary formally report to the main Board on compliance with the Code of Practice in a similar manner as the Chairman of the main Board reports to the Minister.
• Production of Strategic and Corporate Plans in the first six months of the year, approved by the Board and sent to the Minister and Minister for Finance.
• Annual submission to the Department of a statement confirming compliance with taxation laws and confirming that all tax liabilities are paid on or before the due date.
Arrangements have been put in place to comply with the new requirements of the revised Code of Practice.
These new requirements include:
• A formal annual performance evaluation of the Board, as well as a requirement for the Board to constantly review its own performance and that of its committees and individual directors.
• Adoption of a statement of strategy for a period of three to five years ahead.
• Linking major items of expenditure to medium to long term strategies.
• The development of a Risk Management Policy, the effectiveness of which should be monitored by the Board.
• Consideration should be given to the establishment of a Risk Committee.
• Where a Board Chair is of the view that specific skills are required on the Board, he/she should advise the relevant Minister of this view in order that the Minister may take the Chair’s views into consideration when making appointments.
• Revised thresholds in respect of the disposal of assets or access to assets by third parties for commercial arrangements.
• Publication in the Annual Report of fees paid to each director, the expenses paid to the Board, broken down by category, and the salary of the Chief Executive Officer.
• Adoption of a policy on foreign travel.
• Adoption of a policy for confidential disclosures regarding possible irregularities in financial reporting.
• Guidelines regarding disputes with other State Bodies.