Is Thames Water Going Down the Drain?

This week in the UK, Thames Water, the company that supplies water to London and the South of England, faces an uncertain future. It has racked up debts of nearly £15 billion, and the UK government will likely have to bail the company out. Thames was privatized during Margaret Thatcher’s premiership in the 1980s, and since then, different entities have bought portions of the company. According to an article in The Independent, the single largest shareholder is a Canadian pension fund called the Ontario Municipal Employees Retirement System, which holds around 32 percent of the company. On top of that, the sovereign wealth funds of both Abu Dhabi and China. While there may not be any outright corruption, there is a valid question: why would a bunch of pension funds and sovereign wealth funds want a piece of a British water company? Besides making money, the whole situation seems murkier than the Thames. The future of Thames Water is uncertain; however, this proves that the Renationalization of crucial industries in the UK should be considered.

Ericsson’s ongoing corruption scandal

The Swedish telecommunication company Ericsson is facing the prospect of being fined again by the U.S. Department of Justice (DOJ). In 2019 Ericsson was fined $1 billion for breaching the Foreign Corrupt Practices Act (FCPA). It is important to note that the DOJ can fine Ericsson, a Swedish company because they are listed on the New York Stock Exchange. Ericsson was found guilty of handing out bribes and operating illicit slush funds to expand their business. According to an article by tech website Fiercewireless.com, Ericsson bribed officials in six countries, Vietnam, China, Djibouti, Indonesia, Kuwait, and Saudi Arabia. On top of that, early last year, there were reports that Ericsson may or may not have paid a bribe to someone affiliated with ISIS to provide telecom equipment to Iraq.

Last week, a Reuters article revealed that Ericsson would be fined another $206 million for not adhering to its original agreement with the DOJ. According to a statement by the DOJ, Ericsson breached the DPA (Deferred Prosecution Agreement) by violating the agreement’s cooperation and disclosure provisions. This means Ericsson was not upfront with the DOJ about their financial activities. As a result, Ericsson must be overseen by an outside compliance professional for a further two years. In many countries where Ericsson operates, corruption is simply part of doing business. However, Ericsson didn’t heed the DOJ’s warning and is now facing a stiffer financial penalty that could have been avoided.

A New Anti- Corruption Task Force in Australia?

The recently elected Labor government (similar to the Democrats in the U.S), led by Prime Minister Anthony Albanese, is planning to introduce new anti-corruption legislation. The main goal of this legislation is to set up a federal task force to oversee any anti-corruption investigations. In recent years, there have been several high-profile corruption scandals, including one involving a labor member of Parliament who accepted money from Chinese donors six years ago. According to Peter Hartcher of the Sydney Morning Herald, polling in Australia suggests that the public wants stronger A-C laws. Although bodies already exist at the state level in Australia dealing with this issue, this new legislation will be national. However, despite Albanese’s pledge to enact the law by the end of the year, there are signs that it could be held up by cross-bench members of Parliament who want an in-depth debate of the bill before enacting it. Its passage has also been held up by the passing of the Queen, which has caused Parliament to go into recess.