Paul Holmes 19 Oct 2024 // 12:52PM GMT
ESPOSO, FINLAND—In a move that recognizes the increasingly tumultuous geopolitical forces facing companies around the world, Finnish technology and telecommunications giant Nokia has divided its corporate affairs function into two separate areas: one focused on communications, and one dealing primarily with geopolitics and government relations
The context for the decision is clear: a recent Deloitte corporate affairs report asked corporate affairs directors to identify the most significant risks facing their organizations, and “geopolitics” ranked number one, cited by 43% of respondents, ahead of regulatory threats and “politics and elections”; the Page Society’s report on “CCO Views Into 2024” reported startling similar views, with geopolitical concerns number one (cited by 45%)ahead of polarization and disinformation.
The reputational risk of geopolitical conflict has manifested in some major challenges for corporations: the Russian attack on Ukraine two years ago led many companies to shutter their Russian subsidiaries, but the conflict in Gaza has created a more challenging environment, with companies accused—often mistakenly—of favoring one side or the other.
As a result, building “geopolitical acumen” was seen as a major priority for corporate affairs leaders responding to the Deloitte survey.
The increased importance of geopolitical factors is not, in and of itself, an argument for creating a new and specialized function focused exclusively on geopolitics. A case—arguably equally powerful—can be made for making sure that communications and geopolitical awareness are more closely connected than ever, that the “geopolitical acumen” corporate affairs directors need to develop should be deeply integrated into the broader reputation management function.
But Nokia has clearly decided to go in another direction, establishing geopolitics and government affairs as a distinct function. The company has named Finland’s former Ambassador to the US Mikko Hautala (pictured) as its chief geopolitical and government relations officer, and a member of the group leadership team.
At the same time, Louise Fisk has been promoted to chief communications officer and will become a member of the group leadership team. (At the very least, having rwo people with corporate affairs and communications expertise on the leadership team would appear to be a positive.)
“Mikko’s vast experience, excellent networks and deep understanding of international diplomacy will be hugely valuable to Nokia as geopolitical factors and government policies increasingly shape our operating environment. His unique strategic perspective will help strengthen our positioning in our key markets,” said Pekka Lundmark, president and CEO of Nokia.
In an article for Fortune last year Lundmark had expressed his concerns: "Geopolitical tensions are increasing the risk of geographic fragmentation. This matters for technology standards. If the world begins to fracture just as the digital and physical realms start coming together, machines could lose the ability to communicate across borders, limiting the exponential potential of digital innovation."
Hautala is a former diplomat with more than two decades of government experience. He served as Finland’s ambassador to the United States between 2020 and 2024. Prior to that, he was the Ambassador of Finland to Russia between 2016 and 2020, and has held a range of government roles, including foreign policy advisor to Finland’s former President Sauli Niinistö.
Hautala joins the company, he says, “at the moment when geopolitical and strategic considerations matter more than ever. Navigating the right path under these conditions is demanding, but offers great potential for sustainable business growth.”
Fisk will continue to be based in London and will also report to Pekka Lundmark. She was previously VP, corporate affairs programs and corporate communications. Before joining Nokia, she worked in a number of senior leadership roles, including BAE Systems Applied Intelligence and Logica.
In a related move, Nokia’s sustainability team, previously part of the corporate affairs function, will report to chief legal officer Esa Niinimäki. Melissa Schoeb, chief corporate affairs officer, has decided to leave the company.