CBI Publishes Report on Board Effectiveness for Fund Management Companies

What You Need to Know

• In April 2026, the Central Bank of Ireland (“CBI”) published a feedback report on its review of Board Effectiveness through the lens of Diversity and Inclusion (“D&I”) in the fund management company sector (the “Report”).
• The Report sets out the CBI’s findings and observations on the composition and effectiveness of boards, senior management teams (“SMTs”) and board committees, as well as governance processes relating to board effectiveness, including board evaluation, succession planning and strategic decision-making.

Background

The CBI considers board effectiveness to be the cornerstone of good corporate governance and views D&I as a key component of board effectiveness.

The review examined a number of key areas including the composition of the board, SMT and board committees, the board evaluation process, strategic decision-making processes, succession planning and broader D&I practices. The CBI’s overall assessment is that while some positive practices were identified, more work needs to be done to enhance board effectiveness through the lens of D&I within the fund management company sector.

Key Findings

Diversity and Inclusion

Firms demonstrated varying levels of understanding regarding the impact of D&I on governance. The review also identified some gender imbalances at both board and board committee levels, with a significant gender imbalance remaining at the SMT level across some of the firms reviewed.

Independent Non-Executive Directors

The review highlighted an inconsistent approach across firms regarding the emphasis placed on the role of the Independent Non-Executive Director (“INED”) on the board. Several INEDs were observed to have been in place for a prolonged period, in some instances for ten or more years. Where an INED has been in place for a prolonged period, the CBI expects that the independence of the director should be formally and comprehensively assessed at least annually, and the appropriateness of the continued use of the INED designation should be considered.

Board Evaluation

The Report observed varying approaches to annual board evaluations and noted that D&I considerations, particularly around inclusivity, were often absent from the evaluation process.

Succession Planning

The Report observed significant variation in the quality of board and SMT succession plans and D&I considerations were largely absent.

Strategic Decision-Making

The CBI identified that firms adopted varying approaches to strategic decision-making and observed that some firms reviewed did not have a standalone decision-making policy and documentation of the strategic decision-making process was often insufficient.

Action Required

The CBI expects that fund management companies, and other regulated firms, review and consider the findings of the Report and examine their governance processes relating to board effectiveness through the lens of D&I. Where gaps or weaknesses are identified, firms should develop and implement actions to mitigate any risk.

The findings of the Report highlight the need for firms to take a more structured and comprehensive approach to embedding D&I into their governance frameworks, board evaluations, succession planning processes and strategic decision-making.

The Financial Services Regulatory Group at Maples Group can assist fund management companies in reviewing and enhancing their governance frameworks in light of the Report’s findings, for example through carrying out board effectiveness reviews, assisting with the development or updating of D&I policies, succession plans and board evaluation processes or advising on governance best practices.

Further Information

Further information on our Irish Financial Services Regulatory Group and the services we provide is available on our website and in our FSR brochure.

If you would like further information, please liaise with your usual Maples Group contact or the persons listed on this page.