Shay Brennan Warns of Carbon Credit Exploitation and FDI Flows
Shay Brennan questioned whether international funds are using Ireland’s tax‑efficient structures to maximise profits while charging as much as 12% to poorer countries, and urged parliamentary scrutiny. He cautioned against carbon credits as false solutions and called for reductions in fossil fuel use, a transition to renewables, and increased climate finance for loss and damage, mitigation and adaptation.
Tax structures and international funds
Shay Brennan raised concerns that international investment funds may be using Ireland’s tax‑efficient structure to channel profits and levy significant fees on more vulnerable countries. He suggested this committee or the Finance Committee should examine whether funds are maximising profits while charging rates he described, and called such a practice outrageous if proven.
Carbon credits and climate justice
Brennan expressed scepticism about carbon credits, warning they are often associated with carbon offsetting and can be false solutions to the climate crisis. He argued poorer countries in the Global South may receive unfair carbon credit allotments and urged assistance to help them access carbon markets more transparently to address climate injustice.
Foreign direct investment and profit shifting
He acknowledged that foreign direct investment is an entrenched part of Ireland’s economic model and has provided jobs, but warned that some FDI activity involves profit shifting that diverts money from Global South countries. Brennan described parts of this model as extractive, with funds channelled through Ireland to finance fossil fuel expansion overseas.
Research and evidence
Brennan cited research by Profundo using Bloomberg and established financial databases to trace money flows that land in Ireland—often via headquarters such as BlackRock or State Street—and then move on to fund coal, oil, gas and mining expansion. He noted the opacity around how long funds remain in Ireland but said the amount flowing through and out to fossil fuel projects can be measured and offered to share detailed methodology with the committee.
Recommendations and next steps
He urged closer analysis of tax structures, FDI channels and carbon credit mechanisms and recommended prioritising direct action: reducing fossil fuel use, accelerating the transition to renewables, and delivering climate finance for loss and damage, mitigation and adaptation. He offered to provide the committee with research and evidence to support further scrutiny.
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Thanks. I just want to go back to, I mean, the first thing I want to state is, and maybe this is one for the Finance Committee, but look, I wouldn't like to think that international funds are using Ireland's, let's call it tax-efficient structure, to maximise their profits while charging, I think you said 12%, to those that are worse off. That is something that either this committee or the Finance Committee does need to have a look at, because if that's the case, that would simply be outrageous. But I want to move to carbon, the climate aspect of this. I understand LDCs, the Global South, these countries get carbon credits, or an allotment of carbon credits, but I suspect they're not fair compared to what more developed countries would receive, and I suspect they're being exploited to a certain extent. And it would seem to me that perhaps there's a mechanism through assisting them access to the carbon credit market in a more transparent way that would certainly go some way to addressing the climate injustice aspect of this. I'm just wondering, have you come across any discussions in that regard? I think we would caution a high degree of wariness and scepticism about carbon credits, and something that we would urge the Irish Government not to do and not to look at, because it is often associated with carbon offsetting, false solutions. We need to reduce fossil fuels use, we need to make the transition to renewables, we need to pay climate finance, including loss and damage, mitigation and adaptation. There are buckets of research that we can share with the committee that show how problematic carbon credits are. I'm very happy to do that. And just very quickly on the foreign direct investment, I mean, I think it is one of the cases in Ireland that it is so part of our DNA, this economic model, and we're defending it against the tariffs and trumps. But we have to have greater analysis of our foreign direct investment, because there are parts that are absolutely job providing, and Ireland has benefited from, there's no question about that. But there are parts where profits have been shifted, that have taken that money from Global South countries, and they are part of this extractive model where fossil fuel expansion is being channelled through Ireland, and we'd be very happy to bring that research the committee and share it with you. So you mean by channelled, funded? They use Ireland, so the investments come through Ireland for their global investments. So it's not that… What do they invest in Ireland? The money is coming into Ireland and the money is going out of Ireland. So the investment lands with Blackrock headquarters or State Street headquarters, and then it goes to investment elsewhere in the world, often. How long does it land for? I mean, it's very opaque, and it's difficult to get this information, but we had Profundo, Profundo, who are an established research organisation who looked at this using Bloomberg and established financial databases to look at the money flows coming through Ireland. So again, we're very happy to share, there's a very detailed methodology. How long it actually stays in Ireland, you know, I don't know, but we know how much comes through Ireland, and how much goes out to fossil fuel expansion globally. What do you mean by fossil fuel expansion? So the expansion of mining? Coal, oil, gas expansion.
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