Looking at recent events it is hard for the outside observer not to form the view that it is the trade unions and not the board of directors that are calling the shots at the ESB. The Republic currently risks running out of electricity for the first time since the oil shortages of the 1970s.
That we did not have black-outs this winter probably has as much to do with good fortune as good management. Last week this newspaper reported on a confidential study, by Davy Kelleher McCarthy for the Department of Public Enterprise, warning that the brewing energy crisis could drive away investment. Particularly at risk are the data centres at the heart of the Government's plans to make the State an e-commerce hub. These large webfarms can consume as much power as a small town.
Instead of concentrating its efforts on averting this crisis, the board of the ESB appears instead to be pursuing a self-destructive agenda dictated by elements within its trade union movement. The unions' gambit - a putsch against the chief executive Mr Ken O'Hara, which was supported by some management figures - fizzled out last week.
Whether Mr O'Hara is the best man for the job of running the ESB is not the issue. The question is whether he should be removed simply because the unions don't like him and what he wanted to achieve.
Last week was not the first time the unions have shown their power at the ESB. Last month the company shelved flotation plans which were actively promoted by Mr O'Hara. This was not done because of market conditions; not because the management had changed their mind; not because the company's advisers said no; not because the owner of the company (the Minister for Public Enterprise) was against it. The flotation was shelved because the unions said the company was not ready for it.
Here again the issue is not whether the unions were right - they know the company intimately after all. It is about who runs the company and what is the role of worker representatives in the process.
Unions exist to look after the collective interests of their members. They are frequently significant stakeholders in businesses and have a right to representation. In the ESB this takes the form of four out of 12 board seats, including the deputy chairmanship via Mr Joe La Cumbre. They can also expect a sympathetic hearing from the two Labour Party members on the board, Mr Paul Sweeney and Ms Anne Taylor.
However, even the broadest definition of representing the legitimate interests of the workers in a business could not encompass dictation of corporate strategy.
How this state of affairs came to pass in the ESB is hard to fathom, but it is undoubtedly of the board's own making and not unrelated to the pending energy crisis.
For some reason the board of the ESB has given the unions more and more power in the running of the business. For an example of why this is not a good idea one does not have to look much further than the same organisation. A situation now exists at the ESB where the upgrading of the power transmission network - a fundamental part of its business - cannot go ahead because the unions will not agree to it.
As a result, the vital £2.1 billion investment programme - needed to bring new power stations on stream - is on hold and the managing director of EirGrid, Mr Kieran O'Brien, has warned of possible power cuts.
Anyone who knows anything about unions knows their support comes at a price. In the case of upgrading the ESB power transmission network, the 18.5 per cent over the terms of the Partnership for Prosperity and Progress that was on offer to ESB technicians was not enough and the power grid continues to deteriorate.
The ESB board seems to have walked into a situation where they are incapable of fulfilling their basic mandate.
To the jaundiced outsider, it now appears industrial relations harmony has been put above all else at the ESB. The unions' writ now looks like it runs throughout the ESB, right down to deciding who should hold the job of chief executive. Their tactics found allies among the management and some of the board directors.
Had they succeeded in forcing a vote of confidence in Mr O'Hara, the undermining of the ESB board would have been complete. Thankfully, the incoming chairman, Mr Tadhg O'Donoghue appears to have moved quickly to kill the issue off.
Mr O'Hara has had a close shave but is still in his £180,000 a year plus bonus job. He has a lot to do, but he may be wasting his time if Mr O'Donoghue does not follow through with what he appears to have started. The new chairman must reassert the ESB board's authority and make it one which acts in the interest of all the stakeholders, in particular, the customers who pay the bills and the taxpayers who own it.
