A new report shows that two out of three Irish-listed companies are not complying fully with the combined corporate governance code.

Corporate adviser and accountancy firm Grant Thornton has published the first report into corporate governance standards in Irish plcs.

Its authors say that two-thirds of them are not complying fully with the 2003 combined code, the benchmark that most Irish listed companies use for their annual reports and accounts.

The report states that the main areas of non-compliance were "board balance, committee membership and the separation of chairman and chief executive".

John McCarthy, recently appointed director of professional standards at Grant Thornton, told The Irish Timesthat one of the areas where these companies fell down was on dealing with directors' pay.

"One of the areas that struck me most is that they do not reveal the terms and conditions of remuneration," he said. "They had a low percentage on that score. They don't explore the area but the corporate governance code requires them to do that."

Mr McCarthy and his colleague, Michael Lenihan, surveyed the accounts and annual reports of 42 Irish plcs when they were compiling the report, using a similar model to that used by Grant Thornton in Britain for its annual corporate governance study.

Another key area where they found Irish companies lacking was in carrying out reviews of their own internal control and risk management systems.

The Grant Thornton report states: "The reviewing of internal controls systems is a provision that Irish companies have acknowledged as being important, although disclosure as to the process applied was very poorly reported.

"The reviews mainly seemed to cover financial controls to the exclusion of other material controls, including financial, operational and compliance."

The report adds that only 51 per cent of companies supplied sufficient information to assist understanding of their risk management and internal control procedures.

Mr McCarthy said at the weekend that firms were unwilling to discuss these issues. "A lot of companies do not like to disclose this information."

A majority of companies followed the code in terms of appointing their nominations committee, but many failed to describe the process used in relation to board appointments.

Mr McCarthy said t Irish companies had established good communications with their shareholders, largely through meetings with institutional shareholders and briefings to brokers.

He added that, as many of the companies surveyed had yet to produce their 2006 annual reports, and the combined code only came into effect here in 2005, he expected to see an improvement in compliance over the next year.