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Hempel Fires 4 in Bribery Scandal

Tuesday, October 18, 2016

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Danish coatings manufacturer Hempel A/S is under the scrutiny of German authorities for alleged bribery activities on the part of its employees.

According to the Copenhagen, Denmark-based company, investigators are attempting to determine whether Hempel Germany staff negotiated alleged bribes with ship managers and ship owners in the course of business.

The supplier, which serves the decorative, protective, marine, container, industrial and yacht markets, says it takes the matter “very seriously,” is cooperating fully with the authorities and is providing them with all information requested.

Hempel CEO Henrik Andersen
Photos: Hempel

Hempel issued a statement in which Group CEO Henrik Andersen acknowledged that German authorities are currently investigating whether alleged bribes in relation to ship managers were made by employees of Hempel Germany.

Moreover, four employees of Hempel Germany, based in Pinneberg, Northern Germany, have been terminated in relation to the scandal.

“Unfortunately, Hempel must acknowledge that contrary to expectations, practices that apparently do not comply with the German legislation have been identified. These are practices connected to the relationship between Hempel Germany, Ship Managers and Ship Owners,” Henrik Andersen, Group CEO, said in a corporate statement.

“Hempel deeply regrets that in some instances, internal rules have been deliberately circumvented and German law might not have been followed."

Ongoing Investigation

Launching its own internal audits in response to the authorities’ suspicions, Hempel has brought on an independent, external law firm to investigate Hempel Germany on behalf of the supplier.

The violations of the internal rules and German law have had consequences, the company noted. In addition to the four employees already dismissed, whose terminations were reported to be effective immediately, more dismissals may be warranted as the investigation continues, it said.

Hempel’s position on any unlawful activity is very clear, it emphasized: "We do not tolerate and do not accept illegal practices,” Andersen stated.

“We consider the offenses to be an attack on our customers, Hempel’s culture and values and with that an attack on our approximately 6,000 responsible and committed employees worldwide," he added.

Hempel ship coating market

Four employees at Hempel Germany were terminated as a result of the bribery allegations, the supplier said; more dismissals may come about as its own internal investigation continues.

In an effort to “live up to its responsibility as a fully responsible company,” the company has instituted a number of process changes and implemented initiatives to ensure future compliance with internal rules and the law, it said.

Few Details

While specific details of the case are not available at this time, the head of a leading ship manager anonymously told global maritime and shipping news site Splash that “Volume discounts or brokerage fees between buyers and sellers are well known, normally governed by contractual conditions between owners, managers and suppliers. Of course, if someone has been playing games contradicting these conditions then it’s not on.”

About Hempel, Hempel Germany

Hempel, which has supplied marine coatings since 1915, has staff in 80 countries, with 27 factories and 150 stock points present around the globe. The company reported revenue of €1.6 billion ($1.76 billion) in 2015.

Hempel Germany GmbH reportedly employs 70 people in six different locations throughout the country. The Pinneberg site houses 35 of those employees. In 2015, Hempel Germany delivered a turnover of €51 million (about $56 million).

   

Tagged categories: Asia Pacific; Business matters; Business operations; Coating Materials; Coatings manufacturers; EMEA (Europe, Middle East and Africa); Ethics; Hempel; Latin America; North America; Violations

Comment from Car F., (10/18/2016, 11:40 AM)

Bribery and corruption is the lubricant that maintains the system running, everywhere and in all aspects. Some countries and businesses are more blatant and less discreet. Others are more subtle and hypocritical and shroud these practices in legalese that no one can understand, except the beneficiaries.


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