Ericsson board loses 2nd vote over corruption liability
Ericsson CEO Borje Ekholm and most of the vendor’s board remained on the hook for potential legal action over their handling of a corruption probe in Iraq, after shareholders voted against discharging them from liability for a second year in a row.
At Ericsson’s AGM, shareholders representing more than 10 per cent of its equity voted against discharging the bulk of board members from liability for activities in the 2022 financial year, meaning they can be sued by the company and shareholders under Swedish law.
Of the 11-member board, only Carolina Dybeck Happe, who joined in 2022, and employee representative Annika Salomonsson were cleared.
Ericsson shareholders have taken issue with the board’s handling of alleged bribery, with the company forced to make a $1.1 billion payment to the US Securities and Exchange Commission in 2019 to settle a corruption investigation spanning at least five markets across 17 years.
With the company’s top brass also losing a vote in 2022, arguably the same fate was expected this time round following recent developments.
No doubt shareholders were further aggrieved after Ericsson was hit with a $207 million fine by US authorities earlier this year for a failure to properly disclose information relating to the probe in 2019.
Swedish Shareholders Association representative Sverre Linton told Reuters Ericsson’s board was yet to provide more details promised to stakeholders almost a year ago. Bloomberg
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