Norway’s large international telecoms firm Telenor, now launching its new mobile operations in Myanmar, has 14 months to find a replacement for its chief executive officer Jon Fredrik Baksaas. He could have stepped down in November, when retirement age sets in at 60, but Telenor extended his contract and he’ll stay through 2015 before moving over to a role as “special adviser” for at least another year.
Baksaas has overseen Telenor’s massive international expansion into Russia, south and southeast Asia and, most recently, Myanmar (Burma). The Burmese venture is creating some major challenges, reports newspaper Dagens Næringsliv (DN), with the company having to be on constant guard against suppliers using child labour and working in remote areas where various guerrilla groups are active. Telenor officials, though, are convinced it’s worth it in the end, and can also contribute towards controlling such problems as they crack down on violations.
“Doing business in Myanmar is very demanding,” agrees Andreas Indregard, former director for the humanitarian group Norsk Folkehjelp in Myanmar. Land grabs, corruption, land mines and woefully deficient infrastructure are just some of the other issues listed in a report compiled by Telenor itself after it made 700 unannounced inspections of work being carried out to build Myanmar’s mobile phone network.
The goal is to reach the large masses of people who have never owned a mobile phone, and to become Myanmar’s largest mobile operator. Telenor won the rights to operate in Myanmar after it emerged from years of harsh military dictatorship, and was keen to present itself in Mandalay over the weekend.
“We’re taking 300 employees with us and will sell sim cards on the streets,” Sigve Brekke, Telenor’s Asia chief, told DN before leaving Telenor’s regional headquarters in Bangkok late last week. After Mandalay, Brekke planned to visit Nay Phi Taw and then the former capital of Rangoon, with the rest of the country coming later.
Burma boss among the CEO candidates
Brekke himself is widely viewed as Baksaas’ “crown prince” and the top internal candidate to succeed him as CEO. He has been instrumental in building up Telenor’s large presence in Asia, which now accounts for around half of the company’s revenues and 60 percent of its employees. Profits have been rung up, too, and Telenor could boast around 157 million customers in Asia in the second quarter.
There have been challenges along the way, not last in India, and Telenor chairman Svein Aaser said the job of finding Baksaas’ replacement hasn’t begun. “We just wanted to avoid speculation around his 60th birthday (on November 21),” Aaser told DN in explaining why the company announced Baksaas’ contract extension on Monday. “There are both internal and external candidates, but we haven’t begun the process.”
Analysts point to Brekke, age 55, as chief among them. With the Nordic areas becoming a steadily less important part of Telenor’s operations, it can be important that Telenor’s next CEO knows the Asian markets well. Other candidates include Berit Svendsen, managing director of Telenor Norge, Jo Lunder, head of Vimpelcom and Morten Karlsen Sørby, Telenor’s strategy chief.