JUDr. Aleš Janků is one of the most experienced lobbyists in the Czech Republic today. Last week, he was elected to the board of the British chamber of commerce in Prague.

“Já se vrátím, a se mnou přijde zákon.” (I’ll be back, and with me will come the law.)

I thought of my favourite line in the Czech cowboy comedy Lemonade Joe last week while listening to one of the most experienced corporate lobbyists in the Czech Republic, a 62 year old lawyer called Aleš Janků, make his pitch to become a director of the British chamber of commerce.

“With me comes money”, Janků told the annual general meeting with a great big Lemonade Joe grin (put him in a Stetson and he would look just like Karel Fiala.) I found this disarmingly frank. After all, his employer, the specialist consumer lender, Provident Financial, is a publicly traded company listed on the London Stock Exchange.

So Aleš Janků comes with (his employer’s) money. But before looking at his professional history, in particular when he was employed as senior in-house lobbyist for Philip Morris in the 1990s, the reader should know that I was standing for a place on the same board last week, and failed to be re-elected for a third term to what is an unpaid position and a somewhat thankless task. I expect many will dismiss what follows as written in spite. And when you are done dismissing, please then consider the facts set out below.

JUDr Aleš Janků is now the public face of an institution promoting fair and honest business dealings on behalf of its 250 members. His past is not irrelevant. And can we be sure it is even past?

Janků has been an in-house corporate lobbyist since 1993, after almost twenty years spent as a career diplomat. As a director of corporate affairs for Philip Morris, then T-Mobile and Provident Financial, he has been the interface between his employer and government, the point at which the business corporation and the politician interact. As a lobbyist myself, our paths have crossed. At one point, he was a client, until he poached our account manager and we ended the contract.

StB or not StB, that is the question

Janků joined the Czechoslovak diplomatic service in 1975, having graduated in international law from Charles University. He left the service in 1993, his last posting spent at the Czechoslovak mission in Switzerland, where he held the rank of counselor.

However plausible it might seem given his long service to the communist regime, one cannot be sure that Janků was an StB agent. He appears on the list of StB agents published by the dissident and former political prisoner, Petr Cibulka, under the codename Akim. The accuracy of this list has been challenged, and with good reason. After all, the list was compiled by state-sanctioned criminals based upon information in many cases supplied by informers. In fact, there is no definitive list, and never will be.

The nature of the various roles Janků played as a communist diplomat will remain a mystery. Switzerland in 1990 was a critical mission for an elite facing political and economic upheaval, and even extinction. It is reckoned that hundreds of millions of dollars were hidden in Swiss banks by the top echelons of communist Czechoslovakia at around this time, with much of it later brought back home to be used to acquire state assets being sold off to the private sector.

However opaque Janků’s role might have been as a regime diplomat, his role as the in-house lobbyist for Philip Morris is much more transparent –though not entirely so.

King-size sponsor

On the eve of Czechoslovakia’s dissolution, he left the diplomatic service to join the global tobacco company as director of corporate affairs. Philip Morris had been doing business in communist Czechoslovakia since 1987, when its Marlboro brand of cigarettes started to be made under license in Kutná Hora by the state tobacco monopoly. In 1992, Philip Morris bought the company, and in so doing gained much more than a competitive advantage over its Western rivals. It acquired vast political influence, deriving from the revenues it generated for the state budget and, more importantly, from the donations it made to political parties and other worthy causes such as the Václav Klaus Foundation.

For the next ten years, at a time when the Czech party political system was being built from scratch and in desperate need of funding, the hero of our story functioned as the principal interface between Czech politicians and his cash-rich employer.

Philip Morris was a king-size sponsor of the country’s new political parties, with much of its support going to Klaus’s ODS. No one knows exactly how much tobacco money was donated to parties and their associates in the first decade of the Czech Republic, but it is likely to have amounted to several million dollars over the period, and to have been rather more than the parties or the tobacco companies are willing to admit. The donations made by Philip Morris were overseen by Aleš Janků in his capacity as the firm’s corporate affairs director.

A tobacco company has many reasons to buy political influence. In the case of Philip Morris in Prague in the early 1990s, the reason was not to fend off onerous health regulation. Philip Morris needed to protect its competitive advantages, acquired at a cost of some $400 million. In particular, it was determined to protect its local cigarette production monopoly, which forced its rivals, for one of whom I worked as a lobbyist, to import ready-made cigarettes attracting a hefty import duty.

The government was most reluctant to remove this monopoly until by good fortune a friendly official in the agriculture ministry slipped us a part of what appeared to be the secret sales agreement between Tabák and Philip Morris. It purported to show that, in acquiring the state tobacco monopoly, Philip Morris had also been granted what the document described as ‘protection from future competition’ (not protection of future competition, but from future competition). Armed with this knowledge, it was relatively easy to get things moving (by simply showing the relevant page to various government ministers), and in December 1993, the Czech parliament abolished the production monopoly.

There are lots of tobacco industry documents supplied by the industry itself and put on-line by the University of California. Few are of much interest. There are some worth looking at however. There is a 1995 memo addressed to Janků instructing him to fund the Czech advertising industry’s self-regulatory body. (see here )

And there is the record kept by Philip Morris of its very public donation in 1996 of $100 000 each to the three ruling parties at the time, ODS, ODA and KDU-ČSL, in which the country manager reveals that he has a spare $100 000, originally set aside for the Václav Klaus Foundation but for some unexplained reason, not handed over. (see here )

Party political donations from private companies are legal provided they are declared. But few of us believed at the time that Philip Morris had limited its donations to these publicly declared and relatively trivial sums. Nor did we consider it plausible that ODS, as the dominant party, had received the same paltry sums as its junior partners in the coalition government. And I am sure we were right.

Sachs of Gold

In 1998, Philip Morris was embarrassed by the claim that it had apparently been donating money anonymously to ODA through an off-shore company registered in the Virgin Islands. There was a farcical press conference held by ODA’s Vladimír Dlouhý in which the former minister of industry & trade admitted that he had indeed negotiated secret donations from Philip Morris and others, that these donations were made through an off-shore company called TMC, and that the donations, some CZK 6 million in all, were made on the condition that the donors would remain anonymous. As Dlouhý put it, “Maybe you have no idea about the possible consequences of my presence at this press conference today. They will not be positive. I have broken my word”. (see here) Dlouhý’s display of remorse is quite unexpected for a politician -until you realise that it is remorse for having broken a promise to a tobacco firm, not for having broken the law. "Thank God", he said, "that we didn't make the mistake of having the donations written down in a contract." Thank God indeed!

Janků was swift to contradict the claims of Vladimír Dlouhý and his party colleague Jiří Skalický, insisting that Philip Morris had declared all its political donations according to the law, and had not used an intermediary in the Virgin Islands to cover its tracks.(see here) Unfortunately, the correspondence between Philip Morris’s internal and external lawyers dealing with this scandal is not available. All we know is that the correspondence occurred, and that in it the following Czech entities and persons were mentioned: KDU-ČSL; ODA; ODS; PPF Investment Fund; Tabák; Václav Klaus Foundation; Vítkovice; Dlouhý, V; Klaus, V; Novák, L; and Janků, A. (see here)

Libor Novák, you may recall, was an adviser to Prime Minister Klaus who later became ODS’s deputy chairman responsible for party financing. He was forced to resign in 1996 after a scandal over the discovery of dozens of anonymous donations to the party. Remember Lajos Bács and Radjiv M. Sinha, ODS’s fictitious sponsors from Budapest and Mauritius? I made up a limerick at the time, which went:

A-nonymous bloke from Mauritius
Whose money was far from fictitious
Gave millions away
Then expired the next day
His timing a trifle suspicious.

MAYBE lives too long

In July 2001, Janků and his team found themselves in the middle of a worldwide public relations disaster. The conclusions of a cost-benefit analysis commissioned by Philip Morris in the Czech Republic claimed that the premature deaths of smokers had significant economic benefits for the state. (see here) The study, written by Arthur D Little, showed that the Czech state ‘saved’ some $150m in 1997 through the deaths of smokers who would not live to use healthcare or housing for the elderly. How barbaric! Indeed! But how efficient!

Unfortunately for Janků, the report became headline news all around the world. "Smoking is cost-effective, says report" declared the BBC; "Smoking can seriously aid your economy" quipped The Guardian; and "Czechs debate benefits of smokers dying prematurely" wrote the New York Times.

Shortly thereafter, Janků was looking for a new job. He joined T-Mobile in 2002 as its in-house lobbyist. In 2007, he had a brief spell as a director of the Czech betting association before joining Provident Financial in 2008, where he works today.

Now some of you, in considering the case of Aleš Janků, will recall Václav Klaus's public attack in 2010 on the motives of AMCHAM's efforts to reform the public procurement laws of this country. He said: "Hodnotím ji s minusovým znaménkem. Tito lidé, těm nejde o protikorupční prostředí. Těm jde o zisky pro své firmy a prokázali to za 20 let existence této komory u nás dostatečně." ("It is not about fighting corruption for such people. It's about their own profits, as the last 20 years of the American chamber of commerce demonstrates."

Some of you will agree with Klaus, and will conclude that the British chamber is lucky to have a board director with such a wealth of practical experience and such excellent access to local power brokers. You might take it as a good sign that a small chamber is able to attract such an accomplished 'man of the world', whose self-declared ambition in life is to be a 'rentier in Switzerland' (sic).(see here)

You might argue that success in business requires one to cut a few corners. And you may point your finger at the former chairman of AMCHAM, Ronald Adams of Tatra, who goes on trial for corruption next month. Shit happens at the top, you will say, the price you pay for winning. Fair play is for losers.


...but he lives longer.

Others might argue that fair play and profit are mutually exclusive only for as long as the political and corporate leaders of a society act as if they were. And you may consider it unfortunate that a man who spent the first fourteen years of his career serving a criminal regime, and the next ten years responsible for the funding of political parties, that such a person should now be representing an institution whose limited influence is based upon its reputation for fair play in business.

And of course the great majority of you will be utterly indifferent. As Horač Badman, known as HogoFogo, observes, "Life's farce bolts by like a horse, and its spectators are not the slightest bit interested in the plot of the first act..."

As for me, I would like people to know the kind of businessman they are dealing with, and to decide for themselves whether this former communist diplomat is the kind of ambassador the British business community needs.