Pietari ja Baltia suomalaisyritysten turvallisuusympäristönä 1994–1999

In the summer of 2000, as this report is under preparation, about six months have passed since the final stage of the fieldwork of this series of studies was completed. Presently, development in Russia and, as far as this study is concerned, St. Petersburg in particular, is once more about to take on a new direction. It is too early to attempt to guess what kinds of effects this is going to have on the economy and the business security scene, albeit some signals may be discerned already. Intelligence activity directed at foreign businesses has grown significantly over the last six months, and also Finnish companies have been affected. In the midst of all expectations, suspicions and rumors, it would seem to be quite clear that Russia and St. Petersburg are, from a Finnish perspective, going to continue to represent an exceptional business and company security setting. For this reason, those who are considering to become established in the region can hardly be too careful in their preparatory research. Similarly, those already active in the area, are going to continue to need to be careful, to exert effective control, and to invest in conscientious information collection and analysis.

We have now studied the St. Petersburg region and the Baltic states for about five years with this particular approach. To what degree our research project has fulfilled its primary goal, i.e. whether it has been useful to Finnish authorities and to the companies operating in the area can only be assessed by these parties themselves. As a research lesson that became increasingly evident in the course of the series of studies we may conclude that Finnish companies that operate abroad represent for Finnish interests an invaluable source of information that is not only restricted to crime problems experienced by these companies but is also able to provide a more general overview of the region in question. The latter aspect is, however, only served adequately if the size of target group is large enough and if its conditions of operation are roughly similar to those of the local business community. In St. Petersburg, these conditions were not fully met. In contrast, the surveys made to Finnish companies in Estonia in 1995 1996 yielded a picture of the business security situation in the country that was practically identical to the results of a national business victimisation survey carried out in 1998. Thus, the experiences of Finnish companies alone were able to provide a very realistic overview of the general crime security situation of businesses in the country.

The degree to which the companies approached for information depended primarily on how useful they understood the study to be for themselves. However, also the support and cooperation of Finnish authorities and their obviously good reputation among the respondents played an important independent role in regards of success in this work. Also the support of local Finnish business associations was important in this respect. In practical fieldwork, a matter of primary importance was thorough introductory information concerning the study. It was also clearly helpful that the survey instrument was formulated after consultations with company representatives and following their advice, and that the results were delivered back to the respondents. Because of the relatively small number of possible respondents, it was instrumental i regards of the reliability of the results that also the non-response was small. With the above methods, this was also achieved. Cooperation with potential respondents started, however, to become problematic in the Baltic countries as well as in St. Petersburg immediately when the management of the business units was transferred into local hands. Even in these cases it was usually possible to locate a Finnish contact person in Finland, but these contacts were not any more informed of everyday activities and problems in the same way as those who lived in the target region. Their knowledge was, also, often of a secondary character. In Estonia, an attempt to change the research language into the local one (Estonian), it was, to an extent, possible to restore the contact. It is possible – albeit not certain – that this could have been effective also in the other countries.

Over the five-year period studied, the business security situation in St. Petersburg changed rapidly in some respects, while other features remained quite constant. At no point in time did it seem unbearable. Also in the early times of the assessment, when the situation was clearly worst, it was possible to operate relatively safely in the city. Safe operation did, on the other hand, require – and continues to require – particular effort and planning from the entrepreneurs. It is not an easy security environment.

The primary problem in St. Petersburg was over the entire research period the weakness of authority-provided security and conflict resolution structures. For this reason, companies are even today going to need to build their security almost entirely on their own. The situation is not improved by the fact that the quality of available private security services is very mixed. The number of partners offering security services is very large, and among them there continue to be many who operate with a shady background, unknown objectives, and questionable methods. Already the task of locating a reliable security company requires active research and screening, but after a suitable partner has been found, the situation does not become much easier. The activities of the security partner in its relationship to the client company as well as on a more general level need to be monitored on a constant basis if one wishes to avoid unpleasant surprises. In spite of the problems, at least the group that participated in the study had, over time, learned to manage their security relationships in an acceptable manner. For those entering the scene today, the situation is also easier than it used to be because they are provided with much better information and experience of the situation than was the case with the companies of the first wave in the early years of the 1990s.

The development in St. Petersburg over the 1990s has deviated from that in the Baltic countries clearly in two particular sectors of business security problems. First, in the early 1990s, extortion criminality reached astonishing dimension in St. Petersburg, with extensive consequences. The years 1993 1995 had an essential impact on the security approach and solutions adopted by the companies operating in the city, and the significant decrease of extortion criminality towards the end of the decade did not change these solutions any more. The result has been the creation of a comprehensive system of security contracts that distinguishes St. Petersburg from its neighbouring areas and continues to represent the central feature of the security environment in the city. Our study was not able to provide a direct answer to the question whether it is possible to carry out large-scale business activity here outside of this contract system. Towards the end of the decade, the risk of being victimised by extortionists has decreased clearly also for those who are not part of the contract system. Nevertheless, this threat continues to be real and, as long as the state security structures continue to be unable and unwilling to provide authority-based security, private security services remain the only alternative for protection against extortion criminality and for dealing with problem situation as they come up.

The second sector of business security where the development in St. Petersburg diverges dramatically from the one in the Baltic countries is authority corruption and, more generally, the efficiency of the administration. Also in regards of this feature, the consequences are directly reflected in the working conditions of the companies. The difference has become even more accentuated through the development where, as a side-product of weak administration, also various methods of restricting competition between companies have become more common in Russia. The roots of Russian corruption may be searched from history and from traditions of administration; in recent years it has, however, been mostly fed by inconclusive legislation, by an insufficient control of authority activities, and the links to the realm of business life created by the privatisation process. Also this problem is unlikely to be improved rapidly.

In contrast to these developments, the problems caused by external property and violent crime in the city have remained on a stable level over the last decade, and the level of crimes directed at companies has not been dramatically different from the Baltic countries of even from Finland (regarding property crimes). Thus, in spite of its gloomy overall crime situation, St. Petersburg was not a particularly difficult operations environment in this respect. The crime risks could be controlled and have also been controlled with normal security and guarding arrangements.

The situation has been similar with regard to crime problems represented by the company´s own staff members. Such problems were, indeed, less frequent in St. Petersburg than in the neighbouring countries. This is in particular true for crimes by rank and file employees. The positive situation is largely explained by the application of conscientious recruitment and control practices. The recruitment of local staff to management positions was not equally successful. The main reason of these problems has been caused by the underestimation of control requirements. In many respects, Russian working culture continues to be different from the Finnish one. Also, part of the companies seem to have forgotten that it is necessary to be stricter rather than relaxed when controlling management, as compared with the control needs concerning rank and file. The opportunities for misconduct are almost unlimited, and they have also been exploited regrettably often.

Overall, the security situation of the companies participating in the study changed to a positive direction in St. Petersburg over the period assessed, and in particular in the last years of the 1990s. This has not so much been a result of an improvement in the overall security situation in the city (actually, except for extortion criminality, no significant changes has occurred in the general situation), but rather a consequence of that the companies have learned to operate within the framework provided by the conditions in the city. Despite the fact that all of the problems that in the 1990s were causing St. Petersburg to be a business security environment that was unusually difficult continue to exist also today – and there is no reason to expect them to disappear in the near future either – the experiences of Finnish companies demonstrate that if one applies sufficient attention, flexibility and adaptability, it is quite possible to live with these problems – at best this may even be rather painless.