This article assesses the articulation of vital ethno-national interests and the use and abuse of veto rights in deeply divided societies. In consociational theory, veto rights represent the primary means by which ethnic groups defend their ‘vital interests’, though they are often criticized for rewarding extremism and producing institutional instability. Situating a case study of Northern Ireland in a comparative perspective, I consider two lines of veto practice: liberal vs corporate (i.e. who has veto rights?) and permissive vs restrictive (i.e. to what issue areas do vetoes apply?), to assess what political incentives, if any, they offer for moderation and stability. Drawing from a review of the legislative debates when a veto was enacted and on semi-structured interviews with members of the Northern Ireland Assembly, I argue that a permissive approach, in which groups can determine their own vital interests, can contribute to moderation, peace and stability in divided societies.