Companies
Criminal inquiry prompts Siemens to improve controls
Law firm
Debevoise & Plimpton and accountants
from Deloitte Touche Tomahtsu have begun
an independent inquiry into compliance and the internal control system of German electronics company
Siemens.
The firm was appointed by the audit committee at Siemens
as part of its response to the investigation by German prosecutors into alleged embezzlement at
Siemens' fixed
networks business.
Siemens, which is holding its AGM this month (25
January), has also appointed Michael Hersman as compliance
advisor – he is a co-founder of
Transparency International, which campaigns against corporate corruption.
Hersman will advise the company’s audit committee and managing board on setting
up an effective compliance regime and improve on anti-corruption controls.
The investigations at Siemens have delayed the company’s
joint telecoms venture with Nokia. The two companies said they would wait until
Siemens had completed its compliance review before closing the transaction.
The Siemens scandal raises two issues for corporate
Germany to consider, said the editorial in the
Financial Times (FT, 14 December): the first is transparency, as the fullest
account of what has been happening emerged in a filing with the US Securities
and Exchange Commission, not as a result of German company regulation.
The second, said the FT, is that of board structure: von
Pierer was group chief executive from 1992 to 2005, which means he is overseeing
a response to events that happened on his watch – a clear instance of the
uneasiness that can develop when, as is common in Germany, chief executives
become chairmen.
Links
Debevoise & Plimpton
Deloitte Touche Tomahtsu
Siemens
Transparency International
Financial Times
January, 2007 |
