Ericsson CEO Börje Ekholm admitted to a continued pattern of “hugely embarrassing” and “unacceptable misconduct,” less than 24 hours after his counterpart at rival Nokia rallied the telecom industry to view connectivity as the critical path to a more sustainable world.To get more ericsson news, you can visit shine news official website.

With pressure mounting, Ekholm faced the unenviable task of sharing more details uncovered during an internal investigation that discovered multiple incidents of bribery and corruption in Iraq between 2011 and 2018. Most damning of all, the company can’t unequivocally deny that bribes paid by some employees during that period ended up in the hands of the Islamic State.

“There are parts that can be substantiated and there are parts that cannot be substantiated. And the question on financing armed factions cannot be substantiated,” Ekholm said during a press conference with journalists and financial analysts.

“What can be substantiated are several breaches of our code of business ethics, conflict of interest allegations, as well as other types of misconduct that includes, for example, payment or donations where we cannot find the ultimate recipient, and there are a number of those. And those are hugely embarrassing by itself,” he said. Ericsson claims the pattern of corruption and criminal activities were in the past, but it faces a crisis of trust on that assertion.

The company knowingly withheld this information from the public, and authorities it appears, in late 2019 while it reached a $1.06 billion settlement with the Justice Department related to a 17-year period of similar wrongdoing in six other countries. At the time, it claimed those breaches of the U.S. Foreign Corrupt Practices Act ended in early 2017.

The Swedish company finds itself in a fresh state of uncertainty with potentially significant ramifications barely two years after it signed that settlement to defer prosecution. Moreover, it begs the question: What else is Ericsson hiding?

Investigators working on behalf of the company reportedly discovered fake purchase orders that created an “uncontrolled slush fund,” and were unable to determine who received payments up to $10.5 million, according to a report by The Washington Post.

The internal report, which was shared with the newspaper, concluded Ericsson employees and contractors operated in territory controlled by the Islamic State and made cash payments to militants for transportation. Nearly 100 employees were terminated and about 20 voluntarily resigned as a result of the internal investigation’s findings, according to Ekholm.

The misconduct in Iraq “went on uninterrupted for many years until our new compliance efforts that were put in place in 2017 to 2018 detected a suspicious expense claim,” Ekholm said.

The company ranks as the world’s largest or second largest radio access network (RAN) vendor, according to different market research firm conclusions, but this pattern of corruption puts Ericsson’s recent upswing on shaky ground.Ekholm straddled that line throughout the mea culpa, claiming Ericsson’s increased investment and emphasis on creating a culture of ethical business practices allows the company to improve and root out criminal activity. Creating a culture of behaving ethically, making ethical decisions, and speaking up when wrongdoing is seen or heard has resulted in a six-fold increase in internally reported concerns since 2016, Ekholm said.

“We have made significant commitments for making progress and cleaning up the bad behavior we’ve had. I’ve been working on that, it seems like every single day since I came in to clean up that past but it takes time, and unfortunately we do uncover things that are bad and that are poor performance,” he said.

Ekholm took charge of Ericsson in early 2017. Current Verizon CEO Hans Vestberg led Ericsson between 2010 and mid-2016 when he abruptly resigned following several underperforming quarters. Vestberg’s predecessor Carl-Henric Svanberg ran the company from 2003 to 2009.

Ericsson declined to comment on discussions with authorities regarding misconduct in Iraq. However, the company admitted that the DoJ notified it of an unrelated breach of its settlement agreement due to a failure to disclose certain information.