Corporate Governance in 2025

Claire Lord, Head of Corporate Governance, discusses key changes in Ireland's company law regime and emphasises the need for preparation amongst companies to ensure compliance and benefit from streamlined procedures.

---

During this past year, we have seen some significant company law developments. As we head into 2025, it is useful to reflect on this progression in our company law regime and consider what the governance and compliance landscape will look like in 2025.

European Union (Corporate Sustainability Reporting) Regulations 2024

The European Union (Corporate Sustainability Reporting) Regulations came into force in July 2024. The Regulations aim to integrate the European Union’s Corporate Sustainability Reporting Directive (CSRD) into Irish company law. The CSRD is a novel piece of legislation designed to increase transparency and accountability regarding sustainability matters. It establishes a harmonised EU-wide framework within which in-scope companies are obliged to make comprehensive annual disclosures on ESG matters.

However, the Regulations introduce some unexpected and potentially unintentional complexities. Specifically, they extend the scope of the sustainability reporting obligations to companies that had been expecting to find themselves outside scope. They also expedite the commencement of those obligations for companies which reasonably thought they would have more time to prepare. The reporting requirements themselves are more onerous than intended by the CSRD and they also unduly limit exemptions for group reporting.

It is our expectation that further legislation will be required to align the Irish legalisation with the CSRD. We will continue to monitor any developments and keep our clients properly informed.

Read the full insight

Corporate Sustainability Due Diligence Directive

The Corporate Sustainability Due Diligence Directive, or CSDDD, came into force in the EU on 25 July 2024. It introduces a new harmonised EU-wide framework to enhance corporate accountability for actual and potential adverse impacts on human rights and the environment.

The CSDDD will apply on a phased basis starting in July 2027 and will first apply to EU companies with more than 5,000 employees and which have generated a net worldwide turnover of more than €1.5 billion in the previous financial year. In July 2028, EU companies with more than 3,000 employees and which have generated a net worldwide turnover of more than €900 million in the previous year will be in scope. Finally, in July 2029, EU companies with more than 1,000 employees and a net turnover in excess of €450 million will be in scope of CSDDD obligations.

Read the full insight

The Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024

The Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 was signed into law on 12 November 2024 and many of its provisions will commence to have effect on 3 December 2024. We have been tracking the development of this Act as it made its way through both Houses of the Oireachtas over the course of 2024.

The Act introduces important amendments to four different areas of company law:

• Corporate governance
• Company law enforcement and supervision
• Company administration, and
• Company insolvency

Here are some of the most important amendments from a corporate governance perspective:

• Companies will have a permanent right to hold general meetings entirely online and there will be no requirement for a physical meeting location
• A small or micro company will lose its audit exemption if it fails to deliver its annual return for a second or subsequent time within a period of five consecutive years, and
• There are three additional grounds under which a company can be struck off the register involuntarily, which are for failure to:
  • Make required filings on the Register of Beneficial Ownership
  • Notify the Registrar of Companies of a change of registered office address, and
  • Record that it has a company secretary

Read the full insight

Conclusion

The changes introduced by the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024, while increasing the possibility of enforcement, will unquestionably deliver more streamlined governance processes that will assist with the management of meetings and the delivery of certain transactions. Regarding enforcement, it is important that those running companies are aware of these enhanced regulatory powers so that they can ensure that measures are in place to achieve compliance.

The transposition of the CSRD in Ireland is a significant milestone which launches many Irish companies into a new era of corporate governance in which accountability and transparency regarding sustainability matters are no longer optional. It is therefore important that all companies that are, or will be, in scope are prepared to meet their sustainability reporting obligations. In addition, while the obligations imposed by the CSDDD will not begin coming into effect until 2027, scoping, planning and implementing the necessary level of due diligence will be complex. Therefore, in all of these respects, preparation in good time will be vital, even for companies with existing sustainability due diligence and reporting processes.

For more information on the impact of Ireland’s company law regime on your business operations in 2025, please reach out to a member of our Corporate Governance team.

The content of this article is provided for information purposes only and does not constitute legal or other advice.