Four members of HKScan’s Baltic management team have been terminated after an internal investigation revealed what it considers unethical behavior.

According to a press release from HKScan, certain members of its Baltic management have systematically committed severe violations of HKScan’s Code of Conduct and the principles of good governance. HKScan terminated the managerial and employment contracts of Teet Soorm, general manager Baltics; Mati Tuvi, vice president, Baltic pork primary production; Lauri Kallikorm, vice president, Baltic poultry primary production and Hindrek Smidt, technical manager of Baltic pork primary production.

HKScan additionally issued a warning to several other employees for breaches of conduct related to the expenditure of corporate funds.


The alleged wrongdoing

Some members of the management of HKScan Estonia AS have purchased goods and services from companies managed either by members of HKScan’s Baltic management team or by their related parties, the company said. The combined value of these purchases totaled about EUR28 million (US$29.2 million) between 2013 and 2016. The related contracts failed to comply with the principles of transparency required by HKScan and expected of listed companies, and the decisions made concerning the terms of these contracts resulted in a clear conflict of interests between HKScan and the subcontractor, according to the press release. The subcontractors in question are involved in pig and poultry primary production, the feed business or services such as transport and maintenance, which are closely connected with HKScan’s core business.

HKScan’s Code of Conduct specifies that employees should seek to avoid situations leading to a conflict of interests between the group and the employee or other stakeholders, their relatives or companies controlled by them.

“It is good that we have identified these breaches of good conduct and have taken immediate steps to intervene. It is important to us that both our management and all employees observe our Code of Conduct and that we adhere to the principles of good governance in our day-to-day work,” HKScan CEO Jari Latvanen stated in the press release. “Now we can move ahead and focus on the future. The Baltic region is one of our most important home markets. We have an expert Baltic personnel with whom we can continue building our business with even greater determination and on a more solid basis than before.”