Non Executive Director Service Agreement Template for Ireland

A Non Executive Director Service Agreement is a legally binding contract that formalises the appointment of independent board members to Irish companies. This document ensures your company complies with the Companies Act 2014 and establishes clear expectations for the non-executive director's role, responsibilities, and compensation structure.

When do you need this document?

You need this agreement when appointing any non-executive director to your Irish company's board. It's particularly essential for publicly listed companies that must meet strict governance requirements under the Irish Stock Exchange rules. Regulated entities, including financial services companies overseen by the Central Bank of Ireland, require this documentation to demonstrate compliance with corporate governance frameworks. Private companies seeking investment or preparing for public listing also benefit from formalising non-executive appointments, as it demonstrates professional governance standards to investors and stakeholders. The agreement is crucial when appointing independent directors to audit, remuneration, or nomination committees, where specific independence criteria must be documented.

Key legal considerations

The agreement must clearly establish the director's independence status, as this affects their duties and potential liabilities under Irish law. You need to address the director's fiduciary duties as outlined in the Companies Act 2014, including duties of care, skill, diligence, and loyalty to the company. Time commitment clauses should specify expected board meeting attendance, committee participation, and availability for extraordinary matters. Remuneration provisions must comply with Irish tax law, particularly the Taxes Consolidation Act 1997, which treats directors' fees as employment income. The agreement should include robust confidentiality clauses and conflict of interest procedures, especially important given the director's likely involvement with other organisations. Insurance and indemnity provisions protect both parties while ensuring compliance with statutory restrictions on indemnifying directors for regulatory breaches or criminal acts.

Legal requirements in Ireland

Under the Companies Act 2014, all directors must act in the company's best interests and exercise independent judgement, regardless of their executive status. The agreement must acknowledge the director's duties under sections 228 and 229 of the Act, including the duty to avoid conflicts of interest and not accept benefits from third parties. For regulated companies, the Central Bank's Corporate Governance Requirements impose additional fitness and probity standards that must be reflected in the appointment terms. The Protected Disclosures Act 2014 may require specific whistleblowing protections for non-executive directors in their oversight role. GDPR compliance is essential, particularly regarding the processing of the director's personal data and any data protection responsibilities they may have. Listed companies must ensure the agreement complies with the Irish Corporate Governance Annex and any relevant stock exchange requirements. The document should also address requirements under the European Union (Shareholders' Rights) Directive regarding director remuneration policies.