Business

Win Some, Lose Some

Scania Embroiled in Scandal

By Peter Berlin

The Swedish truck and bus manufacturer Scania is in trouble with its shareholders due to a corruption scandal. Swedish Television SVT hosts an investigative program called Uppdrag Granskning which is similar to CBS’s 60 Minutes. Thanks to an internal Scania whistleblower, the program recently managed to expose a major bribery scandal involving senior Scania executives at the company’s factory in India. The factory was opened with great fanfare in 2015. Three years later it was quietly closed down after internal investigations revealed the scale of the corruption.

Henrik Henriksson, President and CEO of Scania. Photo © Scania CV AB

The original intention in opening a Scania factory in India was to build and sell buses throughout the entire subcontinent. The corruption investigation showed that Indian officials were handsomely bribed so that Scania would win lucrative contracts. One such bribe took the form of a luxury version of the model Metrolink HD bus given to the Transport Minister of India as a gift for his daughter’s wedding. The various transactions passed through a chain of Indian middlemen acting as cover for the Indian recipients.

To Scania’s credit, the company’s CEO, Henrik Henriksson, legitimized whistleblowing among the staff when he took office in 2016. The Indiabased executives involved in the corruption scandal have since been dismissed. The whole debacle cost the company half a billion SEK ($60m) in lost profits; hence the indignation of the shareholders who were kept in the dark about the scandal until it was exposed in the Uppdrag Granskning program.

Smaller Airports May Close

Several regional airports in Sweden are experiencing a financial crisis due to lack of government support. One of the airports is Skavsta south of Stockholm whose majority owner is a French company. Another one is owned by the city of Västerås to the west of Stockholm. Yet another one is Bromma Airport owned by the Swedish airport operator Swedavia. Located on the outskirts of Stockholm, it was the main airport of the capital until it was eclipsed by Stockholm Arlanda which opened in 1962. The survival of some other airports in southern and central Sweden are hanging in the balance.

The financial difficulties faced by these airports have been aggravated by the drop in air traffic due to COVID-19. The government is reluctant to subsidize the airports for two reasons: They are primarily served by tourist charter airlines rather than mainstream carriers, and they are too close to the Arlanda hub to qualify for the kind of air access support enjoyed by more remote regions. The government’s position is that it is up to local owners and authorities to cover the deficits of the airports, or else accept that they may have to close for good.

Northvolt Going Strong

Further to our article about Northvolt in the March 2021 issue of Swedish Press (page 25), we can now report that the company has successfully raised SEK 5.4bn ($635m) on the stock market. The capital will be used primarily to complete the company’s R&D facility in Västerås where super-efficient lithium-ion battery technology is being developed. Commissioning of the huge battery manufacturing plant in Skellefteå will require additional funding.

Northvolt has also acquired the US company Cuberg based in Silicon Valley. While Northvolt is focused on the automobile market, Cuberg has its sights on the aviation sector. Cuberg will develop next-generation battery cells for the electromobility market targeting a lower price point, better performance and increased safety. To consolidate its international market presence, Northvolt has plans to establish yet another battery manufacturing facility in Germany.

Two of Sweden’s top fashion enterprises, H&M and KappAhl, have temporarily suspended imports from their suppliers in Myanmar. Forty-five of H&M’s subcontractors are affected; the number of suppliers to KappAhl is smaller. The companies are not saying whether their actions are in support of the popular uprising in Myanmar, instead citing uncertainties in the continuity of deliveries.

Myanmar Crisis Fallout

Women’s Role in the Green Transformation at Epiroc

By Noelle Norman

The transition to the green economy will require greater supply of minerals and metals. At the same time, there is greater customer demand for environmentally sustainable practices. For the mining industry, green mining practices and greater diversity will become crucial for long-term growth.

“W e invest more than ever in R&D to drive these changes,” says Helena Hedblom, CEO of Epiroc, a Swedish company specializing in mining and infrastructure equipment. An offshoot from the Atlas Copco group, Epiroc became an independent company in 2018 when it was listed on the stock exchange.

For Epiroc, the green transformation started in Canada.

“Our first battery products were developed, built and deployed in Canada in 2013. Now we have our new generation ready with our midsized battery electrical drill rigs, 14-ton loaders and 42-ton trucks,” says Hedblom.

And Canada continues to be the country leading the way. Last year, Epiroc signed its first “Batteries-as-a-Service” (BaaS) contract in Canada and the company is in the process of establishing a competence center for electrification in Canada to help drive this technology shift in the rest of the world.

Today, battery-powered vehicle sales represent only a small portion of Epiroc’s total sales, but the company is optimistic about the future.

“We already have battery [powered] electric vehicles in all parts of the world and together with our partner in Canada we will soon launch retrofit capabilities to transform the existing fleet out there into battery technology,” says Hedblom.

Epiroc has committed that by 2030, they will halve the CO2 emissions from operations, transport and the products they sell. The ambitious targets go hand in hand with a program to increase gender diversity. By 2030, Epiroc aims to double the number of women in operational roles and to have 40 percent women managers in the company.

“To be successful we need people with different backgrounds,” says Hedblom.

“The mining industry is becoming a high-tech industry. I see that women can really contribute to this development.”

However, that position hasn’t always been the norm. Working in the mining industry was long considered too dangerous and too strenuous for women. In Canada, women were not allowed to work surface operations of mines until 1960, and it wasn’t until 1978 that they could work underground.

With few role models to look up to, change has been slow. Today, approximately 15.7 percent of mining company employees are female – an increase of only 1 percent over the past five years, according to Bloomberg. In Canada, women comprise only 17 percent of the total national mining workforce. In Sweden, major mining companies are approaching 25 percent. Internationally, most women work in support functions with very few at the management level. Just one in 20 global mining firms is headed by a woman. As CEO of Epiroc, Hedblom makes up one of those few exceptions.

“The leadership must be openminded to facilitate this change. It boils down to brave leaders,” says Hedblom. “With the current technology shift underway, we have a chance to focus on innovation, sustainability and diversity. Those will be my top priorities in the coming years.”

Helena Hedblom, CEO of Epiroc.

Boomer M1 L inspection in underground mine. All photos: Epiroc