Cevian Capital to vote against Ericsson board at AGM
Swedish activist investor Cevian Capital said Monday that it will vote against discharging Ericsson’s board of directors and chief executive from liability at the telecom equipment maker’s annual meeting Tuesday, following revelations of corruption-related misconduct and questionable payments made in Iraq.
Ericsson shares have lost around a quarter of their value since the company disclosed an internal investigation had found evidence of historical corruption in Iraq, including the company being unable to determine if certain payments in the country fell into the hands of terrorist organizations.
The disclosure has also led to criticism from the U.S. Department of Justice, which informed the company that its disclosure of the Iraq probe prior to entering a deal over previous bribery and accounting violations was insufficient.
“Given the lack of information and the extent of the damage, we have no choice but to hold the entire board accountable, and thus Cevian will vote against granting discharge to each of the board members, together with the CEO,” Cevian said Monday.
“With that said, Cevian remains convinced of the strength and potential of Ericsson and its operations. Overall, we have confidence that the board and the CEO can realize that potential, and we will thus vote for their re-election,” it added.
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