CIPFA sets out measures to improve corporate governance in Irish government

01-09-2015

The Chartered Institute of Public Finance and Accountancy (CIPFA) today urged the Irish government to implement a series of reforms to help improve its corporate governance.

In its submission to the Department of Public Expenditure and Reform’s consultation on governance, CIPFA welcomed the draft standard but said that more could be done to build on this to raise standards further across central government departments.

Specifically, CIPFA recommended that departmental management boards move away from a strict management function to greater leadership roles to signal wider change and transformation throughout the organisation.

Departmental management boards would also benefit from external independent membership. The Northern Ireland Civil Service, for example, typically includes two independent board members for each government department, adding objectivity, challenge and breadth of experience.

CIPFA also said that boards should move away from self-assessment and in its place use an external facilitator every year followed by a more comprehensive external governance review every five years. This would remove the risks and pitfalls commonly associated with self-assessment where boards can mistakenly believe they are performing better than they actually are because of a lack of objective and independent review. 

Other recommendations include:

  • Developing structured training to enable politicians and staff to improve their understanding of governance in public bodies, their roles and responsibilities and how these should operate in practice.
  • Having a qualified accountant on each management board as a full member to advise on strategic and operational financial management matters and act as a check against risky projects. 
  • Placing a greater emphasis in the draft standard on values behaviour and culture in departments to help ensure good governance. In CIPFA’s experience, this is often where the greatest risk of governance failure lies.

CIPFA’s submission comes as the Institute prepares to host an event on 2 September in Dublin to promote good governance by highlighting International Federation of Accountants/CIPFA accounting standards.

Jim Kelly, Chairman of CIPFA Ireland, said:

"CIPFA welcomes the Draft Standard. We believe there are many valid points included that will help to improve governance in central government departments; however, we believe the Draft Standard could be enhanced further. 

"CIPFA is happy to advise, in any way we can, on how to strengthen the standard and build governance capacity and capability in central government departments in Ireland."

For more information on the governance event on 2 September in Dublin visit our website.

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