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Jorma Ollila: Champion of Nordic capitalism

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By Richard Milne

Published: March 23 2009 02:00 | Last updated: March 23 2009 02:00

Despite chairing two of Europe’s largest companies and heading a group of the continent’s leading industrialists, Jorma Ollila is hardly a household name. This suits the operational style of the 58-year-old Finn, who is chairman of both Nokia, the world’s largest mobile phone company, and Royal Dutch Shell, Europe’s biggest oil group.

Only two weeks ago he met Angela Merkel, the German chancellor, in his role as head of the European Roundtable of Industrialists, a grouping of the continent’s leading 50 or so chief executives or chairmen. “We like to work in the background,” says Mr Ollila, in what could almost be his mission statement.

This unassuming approach extends to his softly spoken manner and the venue for the interview: a bland conference room in a luxurious central London hotel. As well as masking his level of influence today, his low-key style contrasts sharply with his record. His success as chief executive of Nokia for 15 years – during which time he turned what was once a struggling industrial conglomerate into a global mobile phone powerhouse – prompted British teenagers to vote him the most creative thinker of modern times in a survey conducted five years ago by the UK’s Design Council.

A deeply analytical manager, Mr Ollila likes to take his time to think. He ends a brief off-the-record discussion with the comment: “But that is just a thought. I will come back to you in a couple of years to see whether it has proved to be correct.”

Maybe because of their gestation period, his musings during a simple lunch of fish and salad provide good food for thought – from talk of Europe’s future competitiveness to the chances of a depression and the benefits of Nordic capitalism.

Mr Ollila contends that Europe has performed well in the crisis so far but that the key test of unity is still to come. Without a common approach to matters like next month’s Group of 20 summit in London, he fears for Europe’s competitiveness. “There is a real danger that the dynamism that there tends to be in the US can then kick-start a new growth period earlier and stronger than what we are able to do in Europe.”

He urges European leaders to forget about regulation and try to save the world from “a serious deep and long depression”, the chances of which he says are real but still less than 50 per cent.

Mr Ollila also warns of the possibility of social unrest spreading from the smaller countries of the European Union. “In itself it is a worrying thing. But it is our responsibility to build a system with a certain stability for people.”

He has long had this focus on the social aspects of business. Indeed, Mr Ollila says he is most of all “a people manager”. For example, although Nokia was in trouble when he took over as the company’s CEO in 1992, he still found time to set out values on how the group should behave, treat its people and deal with internal conflicts. He argues that management has to take such a task seriously, instead of making it “an annexe in the annual report”.

As CEO, he felt his role was “to get everybody involved, create a sense of urgency, who does what, and then: run”.

Mr Ollila was helped at the start by the fact that nobody expected much. “We could work for the first two years without anybody expecting anything other than survival at best.” Most fondly, however, he talks of his time as part of a team with an average age under 40 who then turned Nokia around. “It was an entrepreneurial task. It was extremely rewarding,” he says.

The concern for what he calls “the human role” above things like skills and strategy comes across in his passion when enthusing about the Nordic approach to business and when echoing Jack Welch, the former boss of General Electric, by criticising some companies’ sole focus on shareholder value. “The [current] crisis will lead to a rethink in the corporate world. It is not just about short-term, mid-term or long-term profitability but it is also about certain values and how you deal with stakeholders.”

Values are not the only Nordic thing Mr Ollila thinks the world could do with adopting. He argues that the Nordic way of capitalism – being open to globalisation but protecting people from its negative aspects and providing everyone a good, egalitarian education – provides the answers that are needed. “We need to think a lot about social solidarity,” he adds.

He also commends the response of the Nordic region and companies such as Nokia in their last severe downturn at the beginning of the 1990s, recalling that politicians clubbed together, there was no protectionism and companies restructured deeply as they had no other choice.

Indeed, Mr Ollila’s description of his time as chief executive of Nokia has a certain modesty about it as he talks in quick succession about crises in 1992, 1995, 2001 and 2004 and how Nokia rebounded each time. The final time was enough to persuade him to step down as CEO and he says in typical self-effacing style: “After being CEO for 15 years you are a drag on the company.”

He still comes across as the industry visionary, though, predicting ever tougher competition as Google, computer makers and software companies all join the battle on mobile devices. “It will be a very interesting paradigm,” he predicts.

Mr Ollila’s background before joining Nokia was both financial and international. He grew up in the west of Finland before finishing his studies at the Atlantic College in Wales. He returned to the UK to gain a degree in economics from the London School of Economics, adding to Finnish degrees in engineering and political science. He worked for eight years at Citibank before joining Nokia and progressing quickly through the ranks.

That diverse background paid off when he was chosen to become the first outsider to chair Shell’s board at the same time as he “moved upstairs” at Nokia. He says the transition from chief executive to chairman did not faze him: “Chairman is more of a governing role. You have to be very careful not to manage. The adjustment isn’t automatic. But I have found it fine.”

Mr Ollila demonstrates his unflappable side when asked how Shell’s recent decision to stop investing in wind and solar energy and only focus on biofuels plays to its values of trying to address climate change. “It is a business portfolio decision, above all. Not everyone can be a jack of all trades. It is more about pragmatism,” he says.

Efforts to draw comments from him on questions about his role as an outsider at Shell and choosing a new chief executive at the oil company are dismissed with soothing words. Mr Ollila may be careful with what he says, but he exudes a calm confidence in discussing what is needed from politicians and businessmen in the current crisis.

“You don’t look at how good you are yourself but you look at the world as a whole. People need to act together . . . Getting out of this crisis won’t be easy. It needs the wisdom of leadership.”

Glimmers amid the gloom for voice of Europe’s business chiefs

The European Roundtable of Industrialists reads like a Who’s Who of the main business leaders of the continent. With the chief executives or chairmen of groups such as Nestlé, Siemens, British Airways and Total representing €1.6bn (£1.5bn) in annual turnover and 4.5m workers, the group has largely stayed in the shadows. That changed in November when Jorma Ollila, the group’s head, spoke out publicly on the main difficulty for big companies: that their suppliers and customers were struggling to obtain finance.

Five months on and “nothing has improved”, Mr Ollila says. “We are in a no better, no worse situation than we were in November despite all the government measures. The credit crunch is still here.”

However, he is not entirely gloomy. “A number of companies are making the observation that China is not continuing to decelerate. But that is really the only hope.”

Mr Ollila is also positive about how Europe and the European Central Bank have handled the crisis up to now. But the situation remains so critical that his list of worries is daunting: a serious possibility of depression; social unrest spreading from those European Union countries where it already exists; and the risk that protectionism causes damage to both globalisation and the EU’s internal market.

“Globalisation is actually causing a lot of insecurity among the population. Unless we can alleviate that insecurity we might have very negative impacts on policy-making,” he says. and its also non-profit sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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