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Saturday, April 20, 2024

Brekke: ‘We could have done more’

Troubled Telenor’s new chief executive, Sigve Brekke, was back on national radio Friday morning, telling state broadcaster NRK that the company “could have done more” to avert the corruption scandal at its partly owned mobile phone firm VimpelCom Ltd. He claimed he’s “disappointed” over the bribery to which VimpelCom has now admitted.

Telenor's new CEO, Sigve Brekke, was under even more pressure this week. PHOTO: Telenor
Telenor CEO Sigve Brekke has had a very tough beginning in his new role as the company’s boss, and now hopes both he and the company can learn from the VimpelCom corruption scandal and put it behind them. PHOTO: Telenor

Brekke, who was in charge of Telenor’s operations in south- and southeast Asia before taking over as CEO last year, can be glad he wasn’t directly involved with the company’s investment in VimpelCom that ended up creating so much static. VimpelCom became the target of bribery allegations several years ago, when Telenor had representatives on its board of directors and even eventually installed one of its own top executives, Jo Lunder, as VimpelCom’s CEO.

The company, controlled by Russian oligarch Mikhail Fridman, was accused of paying bribes in connection with its expansion into Uzbekistan, and a criminal investigation was launched in four countries. This week, VimpelCom admitted that it had violated “certain” anti-corruption laws in both the US, where its stock is traded, and the Netherlands, where its headquarters is now located. On Thursday, US and Dutch authorities confirmed that VimpelCom had agreed to pay a whopping USD 795 million in fines.

‘Very serious’
“I think this is a very serious case, and I’m disappointed that a company in which Telenor is a part-owner has admitted to corruption,” Brekke told NRK on Friday.

He also said he thinks management at Telenor, which itself is 54 percent- owned by the Norwegian state, could have done a better job following up on the corruption charges against VimpelCom. He wouldn’t comment in more detail on who should have done what, but his remarks are another stab at his predecessor, Jon Fredrik Baksaas, who headed Telenor during the entire period when VimpelCom was expanding into places like Uzbekistan. Baksaas, who has defended his role in the VimpelCom scandal, retired last year and Telenor has since severed all ties with him.

“Telenor is built on Norwegian values, and corruption is something we take very seriously,” Brekke claimed, despite the company’s apparent failure to act when allegations first started swirling. Brekke himself also landed in trouble last fall, after having been found of embellishing his own resumé. Telenor defended its CEO, however, and Brekke now says the corruption at VimpelCom has been another important case of ‘learning the hard way” for Telenor.

Keen to close the case and move on
“VimpelCom itself admits that corruption has taken place, and it’s clear Telenor could have done more as an owner (of the company) by following up on this in a better manner,” he told NRK. He added that he now needs time to read an entire report from the authorities and VimpelCom, and awaits the results of Telenor’s own internal investigation into how it monitored VimpelCom and reacted to allegations against it. That’s due later this spring.

“We will do all we can to lay all our cards on the table so that we can learn from what happened,” Brekke told NRK. “We want to put this case behind us, and it was a milestone that there’s been a settlement (between VimpelCom and the authorities).”

Telenor has been trying to sell its 33 percent stake in VimpelCom since last year and Brekke said efforts will continue, especially now that the “uncertainty” surrounding VimpelCom has been removed. “We hope a sales process can move forward in an orderly manner and as quickly as possible,” Brekke said. “This has been a demanding ownership stake, that we also want to put behind us.” Berglund



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