Fjell, Olav 1951–

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Olav Fjell

Strategic and financial adviser, First Securities ASA

Nationality: Norwegian.

Born: June 28, 1951, in Tromso/, Norway.

Education: Norwegian School of Economics and Business Administration, MSc, 1975.

Family: Married Else (maiden name unknown; a nurse); children: three.

Career: Kongsberg Våpenfabrikk, 19751987, held various positions, eventually becoming chief financial officer; Bergen Banklater, Den norske Bank, 19871995, held various positions, eventually becoming executive vice president for corporate client development; Postbanken, 19951999, managing director; Statoil, 19992003, chief executive officer; First Securities ASA, 2004, strategic and financial adviser for development of Nordic banking operations.

Address: First Securities ASA, PO Box 1441, Vika, N-0115 Oslo, Norway;

Olav Fjell, a banker turned industrialist, returned to his financial roots when he became the financial adviser for First Securities ASA. A quiet man who guarded his privacy and who prized openness and ethical behavior, he became embroiled, ironically, in one of the largest scandals in international business.

He was born in Tromsø, Norway, in 1951. His father was an army officer, so the Fjell family moved around during Fjell's younger years. In a 2001 interview with Solveig Haavik, he described himself as a "gypsy who helps out"; this description may have had its roots in his youth. Following in his father's footsteps, Fjell enlisted in the military and became a lieutenant in the Norwegian army. After leaving the military, he enrolled in the Norwegian School of Economics and Business Administration (Norges Handelshøyskole) and graduated in 1975 with an MSc in business economics.

Throughout the course of his career, which took him into international weapons dealing, banking, oil and petroleum,

and finance, he managed to guard his private life, shielding his family from public scrutiny. Clearly involved in the lives of his children, he served as head of the parents' board for the Asker (Oslo) school marching band, missing only one meeting during the period from 1994 to 2000. He took great pride in the 1999 musical debut of his children.


Fjell's first position after graduation was with the historic munitions manufacturer Kongsberg Våpenfabrikk (KV), which later became Kongsbergs Gruppen. When Fjell joined KV in 1975, the industrial giant was beginning to experience hard times. By 1981 the company and its computer equipment division (faced with closure) negotiated a sale of high-tech tools to the Soviet Union. This deal, which the United States claimed had compromised the security of the North Atlantic Treaty Organization, was a symptomnot the causeof the great difficulties when Fjell took over as financial director. In 1987 KV entered into a policy of major restructuring by selling off its civilian operations (most notably, Kongsberg Albatross, which was the core of its maritime activities). Fjell directed an "asset write-down" for the company, selling off KV's industrial gas turbines division and its equity stakes in several other companies.


In 1987 Fjell accepted a position in pure finance with Bergen Bank, a commercial bank that specialized in financial services. In 1990 it became part of Den norske Bank (DnB). Fjell was DnB's executive vice president for corporate clients, a position for which he was uniquely suited. He continued with DnB until 1995, when he became the first managing director of Postbanken.


Postbanken, the Norwegian state-owned retail supplier of financial services (specifically in the nation's post offices), was established in 1995 with Fjell as its chief. This was Fjell's introduction to working for a state-controlled company and his first opportunity to apply the cost-cutting experience and intraorganizational administration he had learned at KV. In 1998 Postbanken entered into merger negotiations with two other Nordic banks (Christiania Bank and Fokus Bank). The talks failed in September of that year but, undeterred, Postbanken approached DnB, Fjell's old employer.

Early in 1999 DnB, which was Norway's largest bank at the time, merged with Postbanken, creating a financial giant in Scandinavia with total assets of NOK 215 billion ($41 billion). Postbanken continued to operate under its own name, but as a limited company. The merger took four years of restructuring and cost cutting (including the loss of 450 jobs). The deal was announced in late March and, in August, Fjell's employment move to Statoil was announced.


Statoil (originally called Den Norske Stats Oljeselskap) was established in 1972 to develop and manage Norwegian North Sea oil reserves. In the following years its area of activity expanded to encompass global oil and gas markets, making it Norway's largest energy company. It was also an exporter of natural gas into the European mainland. Considering all this, there was some surprise when Statoil announced that Fjell would become president and chief executive officer of Statoil on September 24, 1999. Although he had been on good terms with prominent company members, Fjell was a complete outsider to the oil industry. However, what made him so appealing to Statoil officials, it was explained, was that he had no preconceived philosophies.

Though Fjell was aware of the enormous problems he would be facing, his basic logic gave him a confident outlook. Quoted by Jeff Share in the August 2000 issue of Pipeline & Gas Journal, Fjell said, "What matters is how efficiently you manage your resources, what you do with them, how you create value by gaining positions in the marketplace and satisfying customer needs."

His first problem was the issue of privatization of the state-owned company, which was the reason why his predecessor, Harald Norvik, resigned. At the onset, Fjell declared himself willing to work within the dictates of the boardalthough he was also reported as being in favor of partial privatization. Fjell worked to secure a partial merger with the state's direct financial interestsoil industry interests that were owned by the state but managed by Statoil. In 2001 the state sold 17.5 percent of its shares to private investors, making Statoil partially privatized.

His second task was the strengthening of Statoil's core areas of activity through its investment strategy and through cost cutting by 20 percent (which included staff reductions of fifteen hundred positions). It was his assessment that Statoil had grown too rapidly and had invested too broadlyboth without justifiable return.

In comments before energy executives at the 19th annual Cambridge Energy Associates Conference, Fjell stated that Statoil had to alter its business practices in order to survive and prosper. He said that he saw a need for investment, both in the infrastructure of the company and in the production of oil and natural gas, as well as for increased marketing, trading, and product development. Furthermore, he proposed that the structure of the company's ownership would be altered: it would no longer be simply the manager of Norway's energy resources; instead, it would be a private (or semiprivate) company with a listing on the stock exchange. This change in ownership was part of his mission to see Statoil among the world's top firms by 2005.

Fjell's corporate philosophy included a strong emphasis on environmental, social, and financial responsibility. He told the World Economic Forum, of which he was a founding member, "Indicators related to health, safety, environment and employee satisfaction are thus used for determining my bonus and form part of my performance review." With words that would haunt him later, he continued, "So far, there are no indicators covering bribery and corruption, security and human rights and developmentbut these topics are on the board's agenda and are thus indirectly part of the review of the CEO" (quoted by Alison Maitland in the January 20, 2003, issue of the Financial Times ).

He was also influential in increasing the number of women on the board of directors. In Statoil's 2002 annual report, he said that it was the company's goal to have women in 20 percent of its senior managerial positions. In that year, the company added three women to its board of directors. On this issue, the BBC reported Fjell's statement that "a good balance between men and women adds to the quality of the board" (August 8, 2002).

Under his vigorous guidance and direction, Statoil was restructured in 2000 (part of which was the disposal of much of its U.S. assets). Late in 2002 he announced an increase in Statoil's production of oil. By January 2003 he was considering an eventual merger with Statoil's biggest competitor, Norsk Hydro. Later that year Statoil aided Norsk Hydro in its takeover of Saga (then Norway's third-largest energy companybehind Statoil and Norsk Hydro).

While the CEO of Statoil, Fjell served as speaker at the 16th Work Petroleum Congress in Calgary, Canada (June 2000), and as a member of the General Organizing Committee for the Annual European Energy Conference in Bergen, Norway (AugustSeptember 2000). He is also a member of the World Economic Forum.

Late in 2003, however, the "Irangate scandal" surfaced, a scandal that quickly ended Fjell's career at Statoil. During the previous year Fjell had approved an 11-year, $15 million contract with Horton Investment, $5.2 million of which had already been paid through a Swiss bank account. Horton was a consulting company owned by a London-based Iranian, Abbas Yadzi, and registered in Turks & Caicos (a tax haven). Yadzi was alleged to have close ties to the Iranian government, most specifically to Mehdi Hashemi Rafsanjani, the son of a former Iranian president and an executive with the Iran Fuel Consumption Optimization Organization (IFCO), a subsidiary of the National Iranian Oil Company. Statoil cancelled the contract because, it said, an internal audit had raised concerns about bribery. Details were leaked to the Norwegian press and Norway's National Authority for Investigation and Prosecution of Economic and Environmental Crime (Oekokrim) began an investigation to determine whether Statoil had broken a national provision against influencing foreign officials. Although Fjell and Statoil terminated the contract in mid-September 2003, Norwegian police raided the company offices on September 11, 2003.

Both the U.S. Securities and Exchange Commission (SEC) and the Iranian government opened investigations into the matter (the SEC because Statoil was listed on the New York Stock Exchange and the Iranians because of the implications of corruption). Hashemi, whose position with the IFCO was at risk, threatened to sue everyone who accused him of having a role in the scandal. Iranian authorities demanded copies of the internal documentation held by the Norwegian government and then reacted angrily when that paperwork was not forthcoming.

Statoil also experienced internal turmoil from the scandal. Chairman Leif Terje Løddsøl, having neglected to inform the board of the contract, resigned in October. Meanwhile, Fjell received an initial vote of confidence from the board. But after senior whistle-blowers, including the senior vice president for corporate audit, briefed the board about Fjell being less than completely honest with the board, he was pressured to resign. At an emergency board meeting held on September 22, 2003, he resigned from Statoil with a severance package of nearly $1 million a year for the following five years.


There was no question that Statoil became a very different company under Fjell. His fall from the company had to do with ethical issues, not business ones. After his departure, Statoil remained a partly privatized firm (the state did not step in to resolve internal issues), it still adhered to high ethical standards (the Fjell scandal was seen as an extreme irony), and it continued to be committed to a policy of overseas expansion beyond the Norwegian fields.


Employees of Elcon Securities ASA founded First Securities ASA in 1999. In June 2002 the company was owned in thirds: by the employees, by SpareBank 1 Group, and by Förengings-Sparebanken, the investment vehicle of SwedBank, which held an option to increase its ownership to 51 percent by June 2005. In addition to its headquarters in Oslo, First Securities had two other offices in Trondheim and Stavanger, Norway.

On January 23, 2004, the Norwegian press reported that Fjell would join First Securities ASA in Oslo as a strategic and financial consultant with responsibilities in Nordic investment banking. First Securities is an investment group that is owned in thirds by its employees, SpareBank 1 Group, and FörengingsSpareBank. It has four offices in Norway in addition to its headquarters in Oslo.

See also entry on Statoil ASA in International Directory of Company Histories.

sources for further information

"European Stock Watch," BBC News Online August 8, 2002,

George, Nicholas, "Statoil Loses Chief and Reputation," Financial Times, September 24, 2003, p. 32.

Haavik, Solveig, "Solveig Haavik møter Olav Fjell" (Solveig Haavik Meets Olav Fjell), Økonomisk Rapport, October 2001.

Maitland, Alison, "Inside Track: Tools to Build a Reputation," Financial Times, January 20, 2003, p. 10.

Mellgren, Doug, "Statoil CEO Resigns amid Investigation," Associated Press, September 23, 2003.

Share, Jeff, "Massive RestructuringEnergy Giant Must Change to Prosper," Pipeline & Gas Journal, August 2003.

, Statoil news release, September 23, 2003,

Barbara Gunvaldsen