What happened with the RTE scandal?

What happened with the RTE scandal? Now that we’ve seen thorough reporting about the goings on at Ireland’s public broadcaster, can we pinpoint where it all went wrong?

Yes, we can. Leadership is at the heart of the problem, fed by a lack of governance education and a critical breakdown in trust. It must be rectified if the organisation wishes to win back the confidence of the people it serves.

It’s a high-profile financial and governance scandal involving Ireland’s state broadcaster, Radio Telefís Eireann (RTE). 

In July 2023, it emerged that the organisation’s top presenter was paid more than public accounts declared and that this extra cash came through an undisclosed barter account. 

Like many governance scandals, one revelation fed into another. You can read more about these individual cases below, but to sum up, RTE quickly faced accusations that its entire governance structure was seriously flawed. 

A Mazars report released in May 2024 has revealed that this assertion might largely be true.  

After months of public hearings, dismissals, resignations, and political back and forth, the Mazars report has concluded that a severe breakdown of communications and trust between executives and the board was the primary cause of the RTE scandal. 

The two bodies simply did not work together as they should have, allowing poor business practices to develop between them and at more junior levels. 

Several years’ worth of patchy, informal oversight persisted unchecked and fed a culture that allowed issues such as barter accounts, loss-making musical projects and exit payment packages to senior executives to build over time, the report suggested.

Absolutely. Most weren’t known to the public until the scandal broke in 2023, but they had persisted internally for up to five years before. 

Here is a sample of them from the Expert Advisory Committees Report report released on 7 May 2024 of the governance issues in RTE: 

• The board did not have formal terms of reference.
• The director-general was not expressly accountable to the board (under Section 89 of the Irish Broadcasting Act). 
• The board had no formal schedule of matters explicitly included within its decision-making powers. 
• A stage musical production commissioned by RTE – which flopped at the box office –  was not brought to the board for approval, even though it should have been
• There was no central “Corporate Governance Handbook.”
• Board members could not adequately prepare for board meetings due to a lack of clarity on the agenda items.
• Many individuals relied on verbal reports to communicate critical information.
• Board meetings did not have an action tracker until 2022. 
• There was no board-approved risk management policy

These missing links and informal practices meant that RTE lacked key ingredients of a basic governance framework to enable it to deliver on its mandate. We’ve seen situations like this before and will again.

Yes. The Mazars report revealed the following:

“The proximate cause of the issues that have arisen has been the failure of members of the former Executive Board to inform RTE’s Board of the key issues [the red flags above] and/or not providing information to their colleagues/each other.”

There’s no doubt that this simple but crucial gap in communications established a hostile environment for governance. Just look at this additional line from the report’s introduction:

“Some Board members told us that they did not believe executives considered they were accountable to the Board. In contrast, some of the executives we spoke to, perhaps unfairly, thought the Board a possible source of previous leaks of confidential information.”

In governance, they’re as serious as it gets. 

Boards can’t hope to govern an organisation correctly if they don’t ensure accurate and thorough communication on every key issue. It can be incredibly difficult at times, but it is essential. Not asking the right questions or understanding the answers means critical information clearly passes by the organisation’s top levels of leadership. 

Unsurprisingly, trust can break down in an environment like this. 

This is a tragic state of affairs for such an important organisation and a key factor in other governance issues that have developed over the years. 

In an organisation like RTE, which receives significant public funds and attention, the above problems become amplified.

Governance failures are what happened with the RTE scandal, plain and simple. So, governance remedies are the way it will be solved. Here are some key points that should help moving forward:

1. Multiple reports detailing RTE flaws and avenues for improvement now exist. The organisation must digest the findings and decide which governance recommendations need to be addressed. The ones that expose the greatest risk to RTE should be first in the queue.
2. RTE needs to develop and publish a comprehensive corporate governance framework so that the staff, stakeholders and the man in the street can understand it
3. An external review of the board’s performance by the end of 2025 should assess progress against the corporate governance framework.