The governance failures of the Irish State Broadcaster RTE – What can we learn!

RTE facts

• An Irish state-ownded organisation
• Revenue through license fees and commercial revenue

Governance structures

• Board members and chair appointed by a government minister
• They had 7 male and 5 female board members by the end of 2022
• They had 5 board committees
• It appears they had a number of silos in the organisation which weren’t brought together
• There was no qualified accountant on the board or on the audit and risk committee, nor anyone with a recognised corporate governance qualification by the end of 2022
• The CEO was a member of the board and appointed by the board

Tell tale signs of poor governance

• There was a breach of board confidentiality during the recruitment process for a new CEO in April 2023
• A top TV and radio presenter was paid more than declared in the statutory accounts
• A stage musical production commissioned by RTE which flopped at the box office, was not brought to the board for approval
• Confusion over the role of the Board of Directors and the Executive Board. People within RTE were confused by the status of these boards and which one made decisions.

Finding of various reports

• The board didn’t have formal terms of reference when usually it is good practice to have this in place.
• The CEO was not expressly accountable to the board
• The board had no formal schedule of matters 
• There was no Corporate Governance Handbook
• The board couldn’t adequately  prepare for board meetings
• Many individuals relied on verbal reports to communicate critical information
• Board meetings didn’t have an action tracker until 2022
• There was no board-approved risk management policy
• The board only carried out self evaluations between 2018-2022 but they didn’t carry out an external evaluation which can help call out issues
• There was distrust between the board and the executive team which came out of the Mazars report

Takeaways on RTE

• Government understanding of the skills and experience required to oversee RTE was limited
• No oversight by the state in ensuring RTE adhered to the code of governance
• Board was underpowered given the scale and complexity of the organisation
• Inadequate knowledge of corporate governance at board/executive level
• Absence of board member curiosity
• Chair/board/executive relationship was inadequate

What to look out for in the due diligence process

• What to focus on if you want to become an NED of a board:
  • Financial sustainability
  • Governance
  • Culture and values
  • Strategy and competitive position
  • Innovation
  • ESG

Potential consequences on being on a high profile board that fails

• Collective reputational damage for the board
• Professional and personal damage
• However, what you learn from a bad board experience can be useful to know if you get appointed to another board

In this webinar, we will look at the history of governance in RTE, the tell tale signs that indicated that all was not well, what went wrong and what needs to be done to establish trust and for fit purpose governance at RTE.  This is the greatest governance failure of a state funded organisation in Ireland.

Your takeaways:

• Lessons from the Irish State Broadcaster RTE
• The importance of due diligence before you consider joining a board
• What to look out for in the process
• The potential consequences of being on a high profile board that fails

Join us for this webinar to understand the important role that you can play in improving governance on a board.

David W. Duffy is Co Founder of the Corporate Governance Institute.

David is Ireland’s leading authority on corporate governance, as a thought leader, educator, practitioner, evangelist and author on corporate governance. He has had four books published to date based on his practical experience.  His next book  “A Practical Guide to Corporate Governance” – will be published by Chartered Accountants Ireland in 2025.

He has brought fresh and dynamic thinking to the education of aspiring and existing directors through the provision of stimulating online learning and also introduced AI into the learning process for directors. The Corporate Governance Institute has been a trailblazer in director education providing the first online and accredited Diploma in Corporate Governance and a Diploma in ESG.  Today it has customers in over 60 countries.

He has conducted over 200 board and governance evaluations and reviews for regulated and unregulated bodies.  These include, public and private companies, state funded organisations, charities, membership bodies, sports organisations etc.

He also has practical experience from having been on over 15 boards in Ireland, UK and France in the role of Chair, NED, Executive Director, CEO and Company Secretary.

He graduated from Trinity College Dublin with a Bachelor of Business Studies Degree and is a Chartered Accountant from PWC in London. He also holds an MBA from IMD in Lausanne, Switzerland.