Cultural Exchange

It would be fair to say that Rud Pedersen is well travelled. The 39-year-old Dane enjoyed postings in his home country and Cyprus before an eight-year stint in Moscow, which ended just after he was promoted to area finance director in Europe, spanning ten countries with a base in Brussels. After all that globetrotting, it’s not surprising when he reveals how important cultural intelligence is to him.

‘It’s critical for me to be able to communicate with lots of different people from different backgrounds across the countries in Europe,’ he says of his new role. ‘I have the benefit of having worked across very diverse countries for the past 15 years, so hopefully my cultural awareness and intelligence is good enough. It’s certainly true that you need to make sure when, for example, you’re talking to people in Turkey one minute and Austria the next, that you can adapt to the different cultures and demands.’

Russian experience

It’s not just language barriers Pedersen will need to negotiate. With the credit crunch in full swing and Europe’s pharma giants getting hit by changes in patent laws and regulatory scrutiny, the role of area finance director in AstraZeneca really is a tough job. However, Pedersen has a solid history of rising to challenges, not least in his former role as CFO of the business’s Russian and CIS operations. Based in Moscow, Pedersen has dealt first hand with the challenges of the world’s most exciting emerging market and it’s not something he’s likely to forget in a hurry. But while some label Russia and the CIS as the ‘Wild East’, Pedersen is sanguine about the differences.

‘It’s certainly a very different market to work in than the Western European,’ he admits. ‘If you show up with expectations of a Western European business environment then you’re in for a nasty shock. But I wouldn’t say it’s the Wild East mainly because it’s got a lot better in the last five years.’ Still, Pedersen is aware that running a Russian venture is never going to be easy, in part because of the country’s somewhat unorthodox or antiquated business practices. ‘The biggest challenge is that it’s totally different to what you’d find in Western Europe, where companies largely work to the same ends in the same way,’ he says. ‘In Russia you’ll find different companies have different ways of doing business."

Pedersen declines to elaborate on what that could mean, but it’s seems reasonable to infer from his tone that he has seen a whole new side of the competition’s business practices during his time in Russia. For those expecting Russia to be an extension of Western Europe in its legislation, Pedersen goes on to cite the Russian tax code as evidence that the country has retained some of its independence from Western Europe’s corporate codes.

‘I’ll give you a simple example: there’s an understanding from the Russian tax authorities that if you have plants in the office then the cost of buying and maintaining those plants is not deductible,’ he explains. ‘The view is that it’s not economically justifiable while in Western European countries this would be part of having a pleasant working environment, which would improve employee performance, and hence deductible from a tax point of view. But not in Russia.’

Indeed, despite claims of Russia’s ascension to fully fledged economic partners status, Pedersen says there is still some way to go to bring the country fully to parity with Western Europe. He also believes the statute book is in urgent need of attention.

‘A lot of the local legislation is in its infancy,’ Pedersen says. ‘And despite it’s almost 20 years since the collapse of the Soviet Union some legislation still pre-date that. So while there have been huge changes, there’s a way to go.’

So how did this impact on Pedersen’s work for AstraZeneca?

‘From a legal point of view I’d have to say it was a pretty volatile place to work,’ he says. ‘Some of the legislation simply isn’t fit for a market economy, and there’s a lot of room for interpretation. You could also say that there have occasionally been lapses between the intention behind the legislation and the subsequent interpretation and application.’

Strength in numbers

Of course, AstraZeneca is better equipped than most to thrive in such a market. The company has seen its earnings grow in Russia while employing over 500 people (and a further 125 in the CIS). As far as Pedersen is concerned, surviving in and capitalising on emerging markets requires one overriding quality: flexibility.

‘We’re fairly fortunate in that regard since we as a company have long had a focus on emerging markets anyway,’ he says. ‘The real test comes when you need to show you’re agile. It’s fine having a long-term strategy, but you need to have the ability to focus on the immediate problems at hand and be able to adjust at short notice.’

AstraZeneca’s recent history in Russia suggests that shortterm planning and adaptability are crucial. ‘If you get too hooked into the long-term plans for the business, it can be a problem,’ he says. ‘Maybe you’ve put a lot of resources into building that five-year plan and you focus on following that very strictly, but I think you’re in for trouble since the environment is changing really rapidly and what might have been right six months ago may not be right now.’