Both these companies are Swedish. Both are giants in their respective sectors. And both have recently been embroiled in scandals that have cost their CEOs their jobs. Vattenfall in 2009 and TeliaSonera in 2013.
TeliSonera stands accused of bribery and money laundering in Uzbekistan. Behind the slick falsehoods of its environmentally friendly PR campaign, Vattenfall has invested so extensively in brown coal that, if its global operations were counted as domestic, Sweden would be the world’s fourth highest CO₂ emitting nation per-capita!
I am writing this post, however, because of the final parity between the two companies: both are owned by the Swedish state – TeliaSonera (37% ownership from the State).
It is shocking that Sweden – a country that prides itself on being an exemplary sustainable economy and liberal democracy – is ultimately responsible for such unethical activities.
One need only look over the border to Norway, our friendly rival, to see how things should be done (this admission amounts to high treason for a patriot such as myself). Norway’s Oilfund serves as a paragon for ethical and responsible state-owned investment. Its oil profits are channeled towards advancing renewables and helping vulnerable members of society.
While Norway is certainly fortunate to sit on such lucrative natural resources, the principle remains: state-owned enterprises should both be respectable and serve citizens’ long-term interests. This means ensuring a sustainable future for generations of voters still to be born.
Perhaps even more damning for Swedish state-owned companies is a comparison to the growing number of public companies that are committing ethical business.
As you may remember, in our recent interview, Jim O´Toole, professor of business ethics San Francisco, explained how shareholders’ fickle pursuit of short-term profit could prevent public companies doing long-term good.
Yet surveys from consulting firms as PWC, McKinsey and Ernst & Young reveal the growing agreement amongst business leaders on the importance of sustainability and social responsibility. In recent years, the likes of Levi’s, Nike, Unilever and P&G have been putting these convictions into practice. H&M has recognised that, as a multinational, its social responsibility extends across borders and throughout its supply chain (a stark contrast to TeliaSonera’s Uzbekistani escapades)
If public companies can overcome shareholders’ impatient demands for profit to become more ethical, surely state-owned companies can respect citizens’ values to do the same.
At Respect, we have worked for over a decade to advance sustainable and responsible leadership. 15 multinationals, including Ericsson and ABB, have attended our Business Leaders Initiative on Human Rights (BLIHR) programme.
I will be pleased if more business leaders will be looking into the experience from the BLIHR work when they build their business strategy in the future.