THE MESSAGE from DCC executive chairman Jim Flavin can be summed up in three short words: "I'll go on." Arthur Beesleyreports.
Unmoved by whispers of discontent within the investor community and undeterred by a Supreme Court ruling which found he engaged in insider trading when selling Fyffes shares in 2000, Mr Flavin intends to stay on until his planned retirement in mid-2010. "It is my clear intention and the clear wish of the board," he said yesterday.
Having unanimously reaffirmed confidence in Mr Flavin after the Fyffes action was settled at a cost to DCC of €55 million, the firm's board will this week publish a corporate governance report on the case from its forthcoming annual report.
"There has been substantial media coverage of the case. The true import of the High Court and Supreme Court judgments has not always been fairly reflected," Mr Flavin said in his preliminary results statement. "The directors hope that shareholders, on reading the statement, will have a better and more informed understanding of the board's position."
Mr Flavin said on RTÉ Radio that the matter "hasn't always been covered accurately" by the media, but he declined to say which reports he believed to be inaccurate. It was in the same mode that he responded to many of the other questions he faced.
There was no comment on whether he had handed back the €150,000 bonus he received when the High Court ruled in his favour in 2005. No comment, too, on whether the DCC board had made any contingency plans should Paul Appleby, the Director of Corporate Enforcement, return to the courts to seek his disqualification as a director. And no detailed remark on whether DCC was discussing with the Revenue any tax issues arising from the Fyffes trades.
He said he was never comfortable stonewalling, but he asked reporters to exercise forbearance in advance of the statement. Later, he said that he would not take questions on the statement once it was published.
"As I said at the beginning of the presentation, as we revealed in our stock exchange statement this morning, there is a very comprehensive statement on all matters, all corporate governance matters, arising from the Fyffes case to fully explain why the board unanimously has confidence in me as executive chairman, [which] will be released this week. I can't add to that," he said in response to one of many questions.
"All we would ask is that the board statement, when it comes, will be comprehensive. This is a complex matter. We would just ask that it be examined objectively, dispassionately and carefully."
Keen as he was to stop taking questions on Fyffes, Mr Flavin took the opportunity to emphasise DCC's complexity from a management perspective when pointing to a strategic review now under way.
If the implicit message was that he as company founder and its driving force for more than three decades was best suited to execute that task, he made clear his intention to see that process through.
In a description of DCC's "excellent" shareholder base, he noted that Irish institutions held 19.9 per cent of its stock. Although some close observers speculate that the Irish Association of Investment Managers (IAIM) may yet vote against some board resolutions at DCC's annual meeting in July in protest at Mr Flavin's continuation, it is clear that shares held by its members do not constitute a blocking stake.
Still, it remains uncertain whether the IAIM will be moved to go even that far. If Mr Flavin's defence has always been predicated on DCC's financial performance, better-than-expected annual results yesterday serve only to help his case. DCC shares were up on the performance.
In spite of the simple clarity in the Supreme Court ruling that insider trading is a "fraud on the market", Mr Flavin and his board still claim that the matter is more complex than that. Last November he said DCC always fostered "high ethical standards". DCC's board will have its say later this week. Whether the investment community goes along with its view will be seen in the coming weeks.
Asked yesterday if the response of the DCC board was typical of the way business was done in Dublin, or if he could think of any other board that would adopt the same stance, Mr Flavin said by way of a general remark that he held the standard of ethics in Irish public companies to be "very high".
Audio extracts from the DCC press conference are available online
