Dáil Éireann Debate, Tuesday - 13 June 2023
186. Deputy Eoin Ó Broin asked the Minister for the Environment, Climate and Communications to publish any Shareholder Expectations Frameworks and any formal dividend policies for the ESB that were in place for the period from July 2009 to September 2010. [27421/23]
View answerThere was no Shareholder Expectations Framework in place at the time in question, as the Performance Framework which was advised in the 2009 Code of Practice for the Governance of State Bodies, had yet to be developed by Government.
Following the establishment of NewERA in 2011, the Government began the process of reforming the management of the Government’s shareholder role in relation to the commercial state sector. As part of this reform, NewERA in conjunction with the relevant Government Departments developed a Shareholder Expectations Framework.
Shareholder Letters of Expectation (SLOE) were mandated from 2016 onwards, in accordance with the 2016 Code of Practice for the Governance of State Bodies, and my Department has had SLOEs in place with ESB since then. The purpose of the SLOE is to set out the views and expectations of the relevant Ministers, as shareholders of the companies, on matters including financial performance and dividend policy. These letters also set out the importance of striking the right balance between distribution of dividends and reinvestment in the business.
Due to the commercially sensitive nature of the Shareholder Letters of Expectation, they are not routinely published.
In relation to dividend policies, while decisions on annual dividend payments to shareholders are ultimately a matter for the Board of ESB, the dividend policy at the time was a rate of broadly 30% of expected profits. This was agreed with the company as part of the then Department of Communications, Energy and Natural Resources and Department of Finance approval process for ESB’s Strategic Framework to 2020 and Corporate Plan 2008 – 2012, and was in line with the Government decision (S180/20/10/0964B) - dividends from commercial state bodies.
The dividends paid out at the time in question can be found in the ESB’s Annual Report and Accounts, available on esbarchives.ie/category/annual-reports/.
