If management changes have taught us anything in 2015, it’s that not every senior telecoms executive gets to bow out gracefully.
Just ask Telenor, which bid a fond farewell to long-serving CEO Jon Fredrik Baksaas in August. The Norwegian telco kept Baksaas on in an advisory capacity while his replacement Sigve Brekke got to grips with his new role, but was forced to sever all ties with him just four months later as the corruption investigation in Uzbekistan made his position untenable. Vimpelcom–in which Telenor holds 33%–is being probed by U.S. and Dutch authorities over bribery allegations linked with its Uzbekistan business partner Takilant.
"The situation [is] very unfort unate, complex and sad for the company," said Baksaas. "It is vital that Telenor’s management and board of directors now have room to handle the situation effectively." The scandal also saw off Telenor’s chairman Svein Aaser – he was replaced by banker Gunn Wærsted – and brought about the temporary suspension of CFO Richard Olav Aa and general counsel Pål Wien Espen. Two former nominees to Vimpelcom’s supervisory board–Fridtjof Rusten and Ole Bjørn Sjulstad–were also suspended. The suspensions will stand "until the facts have been established," Telenor said.
Amidst the fallout, Telenor put its Vimpelcom stake up for sale, valuing it at €2.1 billion. "The sales process has been initiated," but it will be an orderly process "that will take some time," Brekke said in October. "[Telenor is] not going to do any fire sale."
Vimpelcom executives have by no means escaped unscathed. Former CEO Jo Lunder, who left the Russian telco in April, was arrested and charged with corruption. He was also one of several executives named in a class action lawsuit filed by Vimpelcom shareholders in the U.S.; current CEO Jean-Yves Charlier and CFO Andrew Davies were also on the list.
Depending on the outcome of the various investigations, 2016 could well see more senior figures at Telenor and Vimpelcom bow out.
South Africa-based MTN was forced into a hasty management makeover this year when its Nigerian unit was slapped with a $5.2 billion fine for failing to disconnect 5.1 million unregistered SIM cards in accordance with the Nigerian Communications Commission’s (NCC’s) timeline. The fallout brought a premature end to the tenure of MTN chief executive Sifiso Dabengwa, who had been in the top job since late 2010. His int erim replacement, former CEO Phuthuma Nhleko, negotiated a reduction in the fine to $3.9 billion, but towards the end of the year the telco revealed it is taking legal action to challenge the authority of the NCC in imposing the penalty.
Unsurprisingly, MTN Nigeria CEO Michael Ikpoki, and regulatory head Akinwale Goodluck, also waved goodbye. Hoping to turn things around at another scandal-hit telco is Ahmad Farroukh, who took the helm at Mobily in July. His predecessor Khalid Omar Al Kaf was suspended by the Saudi Arabian operator in November 2014 amidst an investigation into its accounting practices, and was formally removed from his position in February.
Not everyone who left their job in 2015 left under a cloud though.
David Thodey retired as Telstra CEO in August to be replaced by CFO Andrew Penn. During his tenure, Thodey negotiated two definitive agreements with NBN, both of which had significant consequences for Telstra’s copper network, and oversaw the deployment of the operator’s LTE networks. Thodey’s achievements were recognised at Total Telecom’s Asia Communication Awards in June, where he scooped the coveted CEO of the year award.
Penn got straight to work. His early achievements include upping spending on Telstra’s mobile network by A$500 million (€329 million) and reorganising senior management. "Over three years to June 2017, we expect to have invested more than A$5 billion into Telstra’s mobile network," he said.
A number of other big players welcomed new leaders this year. China Mobile named a new chairman in Shang Bing, a former vice minister at the Ministry of Industry and Information Technology (MIIT), replacing Xi Guohua. Meanwhile, its domestic rivals played a round of executive musical chairs; Wang Xiaochu stepped down as chairman and CEO of China Telecom, taking the helm at China Unicom, while China Unicom chairman and CEO Chang Xiaobing went the opposite way.
Elsewhere, Turkcell named Kaan Terzioglu as permanent replacement to Sureyya Ciliv, who resigned in January; Ooredoo CEO Nasser Marafih was appointed to the board, naming company insider Saud bin Nasser al Thani as his successor; and in the Philippines, PLDT and Smart CEO Napoleon Nazareno announced his retirement.
Telekom Austria also got a new CEO in America Movil-backed Alejandro Plater, as Hannes Ametsreiter hopped across the border to become CEO of Vodafone Germany.
In the vendor space, the biggest change came at Cisco in May, when John Chambers retired after a 20-year stint as CEO. Chambers and his replacement Chuck Robbins both had a hand in the strategic partnership struck by Cisco and Ericsson in November. Meanwhile, Nokia’s €15.6 billion acquisition of Alcatel-Lucent signalled the end of Michel Combes’ tenure as CEO of the latter. He was snapped up by acquisitive cable conglomerate Altice, which appointed him chief operating officer and chairman of its French mobile arm SFR.
Finally, there were also a couple of noteworthy re-hires this year. In February, Charlie Ergen announced he would once again take the top job at U.S. satellite TV provider Dish, the company he co-founded, while Canada’s Telus reappointed Darren Entwistle as CEO in August. He replaced Joe Natale, who left after 18 months after declining to ship his family across the country. It’s hard to believe, but it seems that for some people, there is more to life than telecoms.
