TeliaSonera cuts Sweden staff despite profits

The Finnish-Swedish telecommunications operator TeliaSonera posted on Thursday an 8 percent rise in 2012 net profit, slightly better than expected by analysts.

TeliaSonera cuts Sweden staff despite profits

At 19.89 billion kronor ( $3.13 billion), the group’s net profit was “the second highest net earnings since the merger between Telia and Sonera in 2002,” chief executive Lars Nyberg said in a statement.

“All countries in Eurasia are again delivering positive revenue growth in the fourth quarter,” he added.

Sales were steady at 104.9 billion kronor.

At the same time, Nyberg announced that 900 positions would disappear in Sweden.

However, 200 new positions would also be added.

“We in the midst of a shift in competence. We’ve been a telecom company with analog technology for more than 100 years. The technology of the industry is going digital,” said Nyberg.

He wasn’t able to specify exactly where the cuts in Sweden will take place, but the reductions will occur withing broadband and mobile services.

The sale of shares in MegaFon, the second biggest Russian mobile operator provided TeliaSonera with fresh cash that boosted its free cash flow to 23.7 million kronor, the company said.

It forecast a slight increase in sales this year, depending on the value of the Swedish krona on foreign exchange markets.

TeliaSonera also plans to pursue restructuring plans and said in October that it would eliminate 2,000 positions, roughly 7.0 percent of its total staff.

The telecoms operator said it had hired a law firm to conduct an external investigation into “severe media allegations of corruption and money laundering, related to our investments in Uzbekistan, dating back to 2007.”

The law firm is scheduled to release its findings later on Thursday.

A separate probe by Swedish prosecutors might take up to two years to complete, the company added.

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Sweden slips in global corruption rankings

Sweden has dropped from third to fourth in an annual ranking comparing the levels of perceived corruption around the world.

Sweden slips in global corruption rankings
How corrupt is Sweden? Photo: Fredrik Sandberg/TT

Its Scandinavian neighbour Denmark shared first place with New Zealand in this year's Corruption Perception Index (CPI), released by anti-corruption campaign group Transparency International on Wednesday and ranking how corrupted countries were seen to be in 2016.

Both Denmark and New Zealand were given a score of 90 on the 0 to 100 scale (highly corrupt to very clean), followed closely by Finland and Sweden, which scored 89 and 88 respectively.

While still in the top-five of 176 countries, Sweden found itself pushed down one notch from last year and the group's Sweden office warned that this was no time to be complacent.

“Sweden's good performance in the 2016 index does not mean that we are spared from corruption in the public sector,” Ulla Andrén, chairwoman of Transparency International Sweden, said in a statement.

“Over the past year we have unfortunately seen how core values have wavered considerably. Leading figures have turned out to lack an ethical compass and corrupt behaviour has damaged trust in various public institutions.”

READ ALSO: Why Denmark is world's least corrupt country

Major Swedish institutions were rocked by scandals last year, including claims of cronyism and cover-ups at the state auditor Riksrevisionen and tax agency Skatteverket. Some of the country's largest businesses, such as Telia and Ericsson, have also faced allegations of illicit payouts.

“We believe that everything colloquially referred to as cronyism is corruption,” Lotta Rydström, executive secretary of Transparency International Sweden, told The Local.

“Transparency International's definition of corruption is wider than just bribes: 'Corruption is abuse of entrusted power for personal gain', which includes nepotism, buddy contracts and so on.”

“I would probably also say that several bribe-related incidents in the business world have shown that Sweden is not as spared (from corruption) as many think,” she said.

Rydström warned that the corruption index does not cover local and regional councils, where much of the political decisions are made in Sweden. Municipalities and county councils make up around 70 percent of public administration in the country.

“A high rating does not mean that we can beat our chest and say we are still almost the best student in the classroom. Good can get better and there is plenty to work on. Public procurement, municipal auditing and whistleblower protection are some of the issues we are working on.”

As a whole, Transparency International said that no nation in the world – Sweden included – is doing enough to fight corruption.

“There are no drastic changes in Europe and Central Asia in the Corruption Perceptions Index 2016, with only a few exceptions. However, this does not mean that the region is immune from corruption. The stagnation does not indicate that the fight against corruption has improved, but quite the opposite,” it wrote in the report.