Ericsson chairman Ronnie Leten indicated CEO Borje Ekholm (pictured) has the backing of the board as the Swedish vendor launched a comprehensive review of its conduct relating to Iraq and how this was addressed.
Leten stated Ericsson “continues to coordinate” with the US Department of Justice (DoJ) and other “relevant authorities”. As the fallout from Ericsson’s Iraq revelations continues, the chairman stressed Ekholm “has the full confidence of the board”.
Ekholm has been under fire in recent weeks for not disclosing Ericsson’s probe into corruption in Iraq. For example, Reuters reported proxy advisory firm Glass Lewis recommended to shareholders that they remove him from the board ahead of the vendor’s annual general meeting on 29 March.
Ekholm and CFO Carl Mellander were also named in a class-action lawsuit filed in a US court on 3 March which alleges Ericsson misled investors over five years by overstating the extent to which it had reformed its business practices to eliminate the use of bribes to secure business in certain countries.
In addition, major shareholder Cevian Capital reportedly called for broad changes to Ericsson’s corporate governance.
Scott Dresser, who took over from Xavier Dedullen as chief legal officer at Ericsson today (21 March), is leading the review.
Dresser spent the past eight years as general counsel for Veon, the Netherlands-headquartered group which counts Russia as its biggest market.
The latest controversy at Ericsson began when the vendor told the US DoJ about an internal probe into its business dealings in Iraq when settling separate issues in 2019. The revelation came days after the Swedish vendor disclosed the results of the investigation into its employees and suppliers’ conduct in Iraq.Subscribe to our daily newsletter Back