Since last October, the US packaging sector, against which Jefferson Smurfit likes to compare itself, has done very well, with average gains in share prices of more than 30 per cent. In the same period, Smurfit shares listed on the Dublin market have gone nowhere and even good 2000 results from Smurfit this week show no sign of driving the shares ahead.

What are Smurfit's smaller shareholders to do? Should they hold tight and hope that Smurfit shares recover to the same sort of rating enjoyed by the US packaging sector (including Smurfit's 29 per cent associate Smurfit Stone), or should they follow the lead of Irish institutional investors who have dumped the shares over the past five years.

Logic suggests that if Smurfit is correct and the industry adopts a disciplined approach to pricing and downtime, then the shares should recover. After all, Smurfit, with its pitiful price/earnings ratio of 9, is operating in the same sector as Smurfit Stone with its price/ earnings ratio of 15 and the other US producers with p/e ratios between 10 and 17.

For some reason, not immediately obvious, the European packaging producers are trading on single-figure earnings multiples. So it would seem that Smurfit is seen in investors' eyes as a European stock.

Logic then also suggests that salary packages for Smurfit directors should be based on European-style payment levels rather than the bloated salary and perks that Smurfit directors allow themselves. That's another matter, however, to which we will return.

Analysts have spoken positively about Smurfit's 2000 results and there's no doubt that the figures are very good and well ahead of consensus forecasts. But should shareholders really care about how the company has performed in the packaging marketplace when their investment in the company has gone pear-shaped, with no sign of an improvement?

After all, if financial figures well ahead of forecasts result in a share price standstill, what prospect is there of an improvement?

Showing its age, Current Account can remember the occasion about 10 years ago when Smurfit became Ireland's first billion-pound market capitalisation company. What a landmark that was. Sad to say, 10 years later, Smurfit has become no more than a £1.7 billion (€2.2 billion) company and has drifted in the market's pecking order to the number 10 position.

The sad fact is that throughout all the ups and downs of the so-called packaging cycle, Smurfit has done little for its shareholders. The management may say that it has managed the company well in difficult times, but the bottom line for shareholders is that Smurfit has been a disastrous investment for anybody who put their money into the company in the past 10 years as a long-term investment.

It was a bit rich for a Smurfit executive to comment this week on the wonderful yield that Smurfit's dividend is offering its shareholders. Certainly a 3.5 per cent dividend yield isn't bad in the Irish plc context, but the reason Smurfit's dividend yield is so high is because its share price is so low. If Smurfit had gone even close to matching the performance of the Irish market, then its dividend yield would be far lower and its shareholders a lot happier.

Many Irish companies which are also in cyclical industries have coped with the cyclical downswings in their industry - CRH is the most obvious example in the Irish context. So why has Smurfit not been able to do likewise? Why no diversification from an industry plagued by boom and bust peaks and troughs? The K Club and the disastrous investment in Brent Walker hardly qualify as diversification!

Through all this period, Jefferson Smurfit has deemed it appropriate to pay truly huge amounts of money to its executive directors - currently brothers Michael, Dermot and Alan Smurfit, Michael's son, Tony, and more recently chief operating officer Gary McGann.

Current Account has always felt that directors should share the pain and share the gain - after all, their interests are meant to be the same as their shareholders. But Smurfit's executive directors have not shared the pain - a cut in performance-related bonus last year hardly constitutes painsharing in this column's view.

And throughout this entire period, the Smurfit board has seen fit to thumb its nose at corporate governance - at least as it is viewed on this side of the Atlantic - by its insistence that Michael Smurfit should retain his chairman and chief executive jobs in his new contract with the group. This double-jobbing by Michael Smurfit is just as untenable as the multi-million (including a €5.5 million long-term incentive payment last year) remuneration package that Smurfit's remuneration committee believes he is worth.

Shareholders will at least find out for the first time exactly how much he is paid when Smurfit produces its 2000 annual report in a couple of month's time.

Gary McGann eulogised Michael Smurfit's role in the development of the Smurfit group this week, and gave the chairman/chief executive almost all the credit for Smurfit's growth. Credit where credit is due - Michael Smurfit was the driving force behind the group's growth to a packaging multinational.

But by the same token, if Michael Smurfit takes the credit for the company's growth in the good times for shareholders, then he must be held responsible for the poor return that investors have got from the company in the past 10 years.

Irish institutions have done their investors and policyholders a favour by getting out of Smurfit in the past five years. From holding 60 per cent of the shares five years ago, Irish institutions now hold just 26 per cent, and are likely to reduce that proportion further.

But Irish retail investors still hold 10 per cent of the company's shares, and this unfortunate group can hold out little hope that it will ever get any decent return on its investments. If stable pricing manages to push the Smurfit share price ahead in the months ahead - and that is a mighty big if - then Irish investors should take the opportunity to cut their losses and sell the shares.

At the same time, Irish investors should take the opportunity of the next Smurfit annual meeting to confront Michael Smurfit and his colleagues on a number of fronts - the share price, Michael Smurfit's dual role in the company, the dominance of the Smurfit family around the boardroom table and not least the generosity of the company to Michael Smurfit in terms of his remuneration package.