ALMHULT, SWEDEN -- Ingvar Kamprad, founder of global furniture giant Ikea, said he is "distressed" by the company's troubled expansion into Russia.
"The documented mess in our Russian shopping center company is completely unacceptable," mega billionaire Kamprad said in a statement reported by TheLocal.se. "I have been too optimistic. It is shocking and deplorable that we have wandered off course.,"
"I realize that I have a moral responsibility in this," Kamprad, who had pushed for Ikea to expand its Russian holdings, added. "I am convinced that Ikea can also contribute to a better life for the many people in Russia in the future."
Kamprad's comments followed disclosure of independent audits conducted on Ikea's Russian operations. The audits were initiated after the company admitted in February that two of its senior managers had agreed to pay bribes "related to power supply to Ikea-owned MEGA shopping centers in Saint Petersburg."
The auditors found that Ikea's problems in Russia inlcude lack of permission for operations, poor corporate governance, weaknesses in internal controls and poor personnel management.
Ikea operates 12 shopping centres and 12 stores in Russia; two more stores are under development.
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