IRISH company law needs a complete overhaul in the wake of recent allegations about unusual methods of payment in the past by Dunnes Stores, the country's largest trade union said last night.
"The law on disclosure by Irish companies is years behind that of modern economies," said the SIPTU economist Mr Paul Sweeney.
The Government's "Vision 2010" plan, which sees "Ireland as the best place to do business", was excellent according to Mr Sweeney but it was being undermined by the Government's own inaction on disclosure.
The trade union said it was wrong that large, private companies should be allowed to avoid the responsibility of providing even the minimum disclosure of information. The Companies (Amendment) Act 1987 should be reformed immediately, Mr Sweeney added.
"If there was disclosure of accounts, then directors, accountants and other professionals would think twice about unorthodox business practices," he continued.
SIPTU also said the Companies Office should be overhauled so that the public could get swift access to information, and that the review panel to police the quality of reported accounts - recommended by the Company Law Review Group two years ago - should be established without delay.
"It is high time that the professional bodies of accountants, investment managers, lawyers and the Stock Exchange reconsidered their ambivalent attitude to openness and transparency in business," the trade union said. "Secrecy, low standards and the culture of the nod and the wink are ultimately bad for business."
Earlier this year, the investment house Standard Life said it had written to senior representatives of major companies in Ireland calling for new, rigorous ethical standards.
Companies should separate the role of chairman from that of chief executive; appoint effective, independent, non-executive directors; there should be comprehensive disclosure of remuneration; incentive schemes should reward directors for high performance and not mediocrity; and directors' service contracts should not exceed one year in duration, Standard Life said.
"High standards of corporate governance have tended to produce superior returns for shareholders," said the company's investment manager for Ireland, Mr Des Doran.
