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Leif Johansson said to be in firing line just a month after CEO Vestberg stepped down.
Ericsson chairman Leif Johansson could soon be following CEO Hans Vestberg out of the door, according to a report from Swedish newspaper Svenska Dagbladet.
Under pressure to find new momentum amid ongoing declines at Ericsson’s two biggest divisions, networks and services, Vestberg stepped down with immediate effect in July and was replaced on an interim basis by CFO Jan Frykhammar.
Earlier in July, Ericsson posted an 11% fall in second-quarter group sales and said it would double its cost savings target and cut R&D investments in intellectual property.
Now, according to the Svenska Dagbladet report, Johansson’s days are also numbered at the Swedish group. Citing several sources, the paper said Vestberg’s hasty departure could just be the beginning of changes within Ericsson.
Shareholding companies Investor and Industrivärden have been particularly active in driving through changes in the company’s management and board. According to sources cited by Svenska Dagbladet, Industrivärden president Helena Stjernholm is very critical of how the board has done its job.
The paper also noted that Ericsson has lost about 25% of its market capitalisation since Johansson began his tenure in 2011, and said it has lost ground to competitors such as China’s Huawei.
Ericsson announced a major restructuring plan in April aimed at creating a leaner, more agile organisation and to help it compete more effectively against Huawei and Nokia. At the time of Vestberg’s departure, Johansson said the board still backs the savings plan and new company structure.
