Prima Magazine

Prima is an economy magazine published eight times a year by the Confederation of Finnish Industries (EK), with a circulation of approximately 35,000. Prima is a magazine for top managers, dealing with subjects related to economy, the business environment and other matters of great interest related to industry and commerce. According to a reader survey, corporate executives find Prima to be a high-quality, expert and important magazine. Prima is mailed to the top management of EK's member companies, important decision-makers in the Finnish society, interest groups, and the media.
 

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Prima 4/2010 briefly:

• Kari Jordan, Vice-Chairman of EK in Prima:
FINLAND IS IN URGENT NEED OF A NATIONAL FINANCING COMMITTEE

Kari Jordan, Vice-Chairman of the Board of the Confederation of Finnish Industries EK, predicts increasing difficulties in corporate financing. The regulation of banks is increasing the interest rate margins of credit, while the availability of financing is becoming more difficult. The first signs of this are already visible. “Some foreign banks have announced that they will not refinance the loans of Finnish companies once they mature. That is most serious because very large amounts of international syndicated loans taken out by the companies will mature in the next few years,” says Kari Jordan in his interview for the 10 June issue of Prima.

The intensifying regulation of banks also hits the export trade which is a particular problem for a country like Finland that is heavily dependent on exports. The financing of exports becomes more difficult and expensive. “This is very significant, particularly in a country with plenty of project exports involving machines and equipment,” Jordan points out.

Finland urgently needs public debate on how industry is supposed to finance its exports in the future. Our Asian competitors gain a more competitive edge when hunting for log-term supply contracts because the European-built regulation does not apply to them. “What we need now is a national financing committee to seek solutions before Finland loses its positions in the export markets,” Jordan proposes. In practice, such a committee could consist of representatives of the banking sector, industry and ministries, for example.

• Recent study: LACK OF INFORMATION OBSTRUCTS THE LISTING OF GROWTH CAMPANIES

A lack of information and various misconceptions make growth companies less willing to list their shares, or even join the less stringently regulated First North market place. This was one of the findings of a recent survey by EK and the Helsinki Stock Exchange, the first ever questionnaire sent to unlisted companies in order to establish the thresholds for listing.

EK and the Stock Exchange are concerned because so few Finnish companies have listed their shares during the last few years. The key finding of the survey was that the First North market place is not very well known. Two thirds of the companies answering the survey were not aware of it at all. Another important finding was that regular listing is thought to be challenging from an administrative point of view and its total cost high.

The main factors increasing the administrative work and obligations of listed companies were considered to be the obligation of continuous disclosure, preparation of quarterly interim reports and the requirement for producing IFRS-compliant financial statements.
The improved publicity of the company was considered as the most significant benefit of becoming listed. Although easier financing is considered the second most important benefit, listing is not primarily seen as a vehicle for financing. This may further increase the idea that listing is difficult and expensive. The questionnaire was sent to 2,511 unlisted companies, 12.6 per cent of which replied.

• SHOK clusters got off to a good start

The June issue of Prima tells how the SHOKs, clusters of strategic top expertise, have started their work. The Management Team of SHOKs is headed by Erkki Virtanen, Chief Secretary of the Ministry of Employment and the Economy. He says that he is happy with the way the start-up phase has gone. “For example Metsäklusteri Oy, the expertise cluster in the forest industry, has gotten off to a surprisingly good start and has already produced good results. The companies participating in SHOKs seem to have the right attitude and enthusiasm.”

Virtanen thinks that the telecom industry cluster TIVIT Oy has already started well, as has FIMEC Oy, the expertise cluster for the engineering industry, although its early operations were somewhat hampered by the economic downturn. The group of six SHOKs also include CLEEN Oy of the energy and environment sector as well as the two latest entrants, RYM that concentrates on built-up environments and SalWe Oy that operates on the health and well-being sector.

The role of SHOKs is to gather the expertise of companies, universities and research institutes in sectors that are most important for the competitiveness of Finland. “We should find new Nokias, but it is at least equally important to support the process of strong rejuvenation of traditional major industries,” Virtanen says. He expects the first SHOKs to produce commercial results around 2015.

• KONECRANES NOW TOP OF THE WORLD IN SERVICES

The service business is becoming increasingly important for Finnish industrial companies. For example Konecranes, known for its cranes and lifting equipment, clearly outranks its competitors with its service business. The company also has an excellent outlook for growth, says CEO Pekka Lundmark. Lundmark emphasises that there is much more to service business than traditional after sales activities.
“If the corporate culture is too equipment-driven, service remains at the after sales stage. This means that the focus is on developing and selling equipment and on the subsequent provision of spare parts and maintenance services for that equipment.”

Frank Korsström, Director of Nordic operations at Accenture, says in an interview by Prima that the service business provides the technology industry with plenty of opportunities for profitable growth. Since engineering excellence and technological innovations alone are not enough in competition, a new type of approach is called for in companies. ”In the western hemisphere, companies have traditionally invested primarily in the development of technical features although the improvements thus achieved are often marginal and do little to boost the companies’ financial performance. Now companies are beginning to understand that investments must also be channelled into the productization of services.

• Minister Antti Tanskanen:
ALL PILLS DOWN THE THROAT IN ONE GO

"I think we should take all the pills in one go," Minister Antti Tanskanen describes the set of tools for enhancing the Finnish economy. He compares the work of the group headed by him as an exercise for improving the general fitness of Finland with a treatment consisting of about one hundred ”pills”.

It is not a matter of a single cure or issue that would solve the problems related to economic growth in Finland. It is a matter of an extensive palette. “We must accept the fact that from small acorns, large oak trees grow. We want to take a close look at what is outdated and what new features are required," Tanskanen says. He and his WG have now been working for a year on new ways to speed up the economic growth. The work is scheduled to be completed by the end of August.

The old toolbox contains one important dynamo. Finland has not utilised the information society as efficiently as it could have done. “Finland has actually failed in that. Much can be achieved by developing the information society. It is a question of the society as a whole. In the future, the information and communication society will be as important as electricity once was. Finland is already such a developed society that the only way towards better productivity is by refining information and tuning up the information society."