Water chief didn’t reveal shares till after our query
Ervia CEO McNicholas told Government of potential conf lict next day
THE CEO of Irish Water’s parent company did not inform the Department of Environment that he owned shares worth €1m in a firm that makes millions annually from water contracts until a day after the MoS raised concerns about the issue.
The details are revealed in FOI documents released to the Irish Mail on Sunday. Last night, Ervia-Irish Water insisted that there was no requirement for Ervia CEO Michael McNicholas to inform the department and that he had done so only as ‘a matter of courtesy’.
‘There is no requirement on the chief executive of a State company to make a formal disclosure of business interests to government. This is a matter for the board of the company as is clearly set out in Ervia’s Code of Business Conduct. Mr McNicholas is fully compliant with this code,’ the spokeswoman explained.
The MoS first asked Mr McNicholas about possible conflicts of interest relating to his shareholding in NTR plc on Friday, November 21, last. Mr McNicholas owned 440,707 shares in NTR – which makes €2m a year from Irish Water metre-installation and waste-water contracts through a subsidiary called Celtic Anglian Water.
At 8.55am the next day, November 22, Mr McNicholas emailed department secretary general John McCarthy to inform him of his shareholding and an advisory role he held at NTR.
‘…I still hold some remaining shares in the company. NTR are a 50% owner of CAW, who operate the Ringsend waste-treatment plant. I viewed it as a potential conflict of interest and declared it as part of my declaration under the code of ethics every year,’ the email reads.
Mr McNicholas said that from the outset, he had informed the senior manager dealing with the Ringsend project that he was ‘not to be involved or consulted with regard to any commercial or contractual matters regarding this project or CAW itself.
‘I would also as a matter of course not be involved should any decision regarding CAW come before any Ervia board,’ he wrote.
The MoS published the story on Sunday, November 23.
The next day, Mr McNicholas announced he was resigning as an NTR adviser. He also pledged to sell his NTR shares and donate the money, in the region of €1m, to Focus Ireland.
A share register received yesterday for NTR shows that Mr McNicholas still owns 31,051 shares – worth nearly €80,000 at current prices.
Yesterday a spokeswoman confirmed that these shares were restricted and cannot contractually be sold until next year.
She said: ‘Mr McNicholas is not in a legal position to dispose of his restricted shares in NTR until 2016. In November 2014 he signalled his intention to try to overcome the legal impediments, to allow him to divest himself of these shares sooner than 2016 but to date this has not been possible.
As stated in November 2014, it was always his intention, since some time before that, that he divest himself of these shares and donate the proceeds from the sale to charity, specifically to Focus Ireland. This remains his firm intention.’
Any perceptions about conflicts of interest could have been heightened by comments previously attributed to Mr McNicholas and executives at CAW as they anticipated a windfall from Irish Water for the company.
Speaking to the MoS in 2011, CAW’s managing director, Mark Driver, said: ‘It’s water’s time really. It surely is the new gold, the new oil, if you like.’
In 2012, a year prior to moving to Ervia, Mr McNicholas himself said: ‘The metering of Irish water opens up opportunities for CAW. Celtic Anglian is well positioned to provide those services.’
Mr McNicholas joined Ervia from NTR in May 2013. Six months later, he sold 352,970 of the 793,677 NTR shares he held for €324,732. His remaining shares were worth just over €1m when we broke the story in November as NTR’s share price hit €2.35. Today the price stands at €2.45.
Campaigners for better corporate regulation say cooling-off periods between related jobs and public disclosure of declarations of interest would not allow conflicts of interest to arise or be perceived.
‘Water is the new gold, the new oil if you like’