Hannes Androsch
Encyclopedia
Johannes Androsch is an Austrian entrepreneur and consultant; a former Social Democrat top politician who served as an Austrian Minister of Finance from 1970 to 1981 and additionally as Vice Chancellor from 1976–1981; and a former banker who from 1981-1988 was the General Director of the Creditanstalt-Bankverein (Austria’s leading bank at that time) and subsequently an advisor to the World Bank. From 1989 onward he built an industrial investment group, Androsch International Consulting (AIC) which is a major factor in Austria's internationally active corporate landscape. In addition, Androsch's foundation is an important sponsor of research and development activities in Austria where he is regularly consulted on matters of political, economic and financial importance.
. The family lived through the end of World War II in Southern Bohemia where they witnessed the expulsion of Germans from Czechoslovakia
in June 1945. His mother placed seven-year old Hannes on the window sill and instructed him to watch the events closely so that he would never forget.
Hannes concluded his high school education in Vienna in 1956. He proceeded to study business administration at the College of International Trade (today's Vienna University of Economics and Business
) where he obtained his diploma in 1959, followed by a doctorate in 1969.
His political activities manifested early, and took him to the top position in the Vienna branch of the student organization of the Socialist party
(1960–1961), and then to leadership of the national organization (1962–1963). Thereafter, at the age of only 25 years, he became secretary for economic issues in the club of the Socialist members of parliament, a position which he held until 1966.
and tax advisor, allowing him to participate in the financial consulting enterprise which his parents had significantly expanded; and he became a member of parliament for the Socialist party where he earned himself a reputation as a shooting star. When Bruno Kreisky
turned the tables on Austria's political scenery with the 1970 national election
he made the 32-year old Androsch Finance minister
in his first minority cabinet on April 21, 1970. Androsch continued in this function when the Socialst single-party government consolidated its dominance through the absolute majorities won in the elections of 1971 and 1975. Although he had not been Kreisky's first choice for this position (Schachner-Blazizek and Felix Slavik had declined) the two men developed a working relationship that was, initially, very good. Androsch became a strong advocate of Keynesian economics
, in a modification that became known as “Austro-Keynesianism.”
On October 1, 1976 Androsch was made Vice-Chancellor of Austria while remaining minister of finance. In this capacity he became chairman of the OECD
at ministerial level in 1979, and also served as chairman of the Interim Committee of the International Monetary Fund
.
While Androsch had built an excellent political network within the centrist wing of the Socialist party and especially the Austrian Trade Union Federation
(ÖGB), not everybody was happy with his rapid rise. The fact that the Austrian print media, who for the most part venerated Kreisky and had adorned him with the nickname "Sun King," started to refer to Androsch as the "Crown Prince" did not help. When in 1975 Androsch differed with Kreisky on how to handle the reconfiguration of Austria's state-owned industry, and expressed his wish to become president of the national bank
instead of continuing in the government, Kreisky himself became suspicious of the young man he had mentored for years. He started to take exception to a highly problematic incompatibility that had been public knowledge since Androsch became a member of the government: he still owned the tax advisor company (renamed Consultatio in 1970) which he had taken over from his parents, although he had placed it in escrow
when he became a finance minister.
Towards the end of 1980, after long and intense campaigns by Austria's media and a continued deterioration of his relationship with Kreisky, Androsch resigned from his political positions on January 20, 1981.
, Austria’s leading bank at that time, a little later in 1981. However, he continued to face heavy opposition and revelations made by investigative journalists (especially Alfred Worm
) that culminated in a series of investigations of his personal financial conduct which in part predated his public role or were not demonstrably connected with it. Androsch has repeatedly stated (and has repeated these allegiations in a series of interviews published by the Austrian newspaper "Die Presse" in February and March 2010; see sources) that his Socialist successors in the finance ministry, Herbert Salcher and Franz Vranitzky
(who had been Androsch's secretary, and would later rise to chancellorship) had conspired with Kreisky "who was simply jealous" (and with political opponent Alois Mock
) to "construe the financial and legal proceedings against him" that would not be finally settled for the following 16 years. "I had no chance to even be heard. And many who have participated in this vendetta would now rather pretend that nothing had ever happened."
A central point of Androsch's defence concerning his personal finances—he claimed that a rich "uncle-by-choice" ("Wahlonkel" in German) had provided him with significant funds, and habitually replied "alas, no" when asked if the was a millionnaire—did not hold. On October 8, 1991 Androsch was convicted by the Vienna Regional Criminal Court of having evaded taxes between 1974 and 1983 in the amount of about five million Austrian Schilling (roughly corresponding to EUR 500,000 expressed in 2010 currency), a minuscule fraction of the original allegiations. He was sentenced to a fine of 1.8 million Austrian Schillings.
A legally separate but politically related affair (a conviction for false testimony to the parliamentary examination board investigating the scandal surrounding the Vienna General Hospital
) forced Androsch to resign from the Creditanstalt post in January 1988. With the help of a Swiss member of the Bilderberg Group
, he became a consultant to the World Bank
, especially for China and parts of Africa, until 1989.
By way of AIC, Hannes Androsch is co-owner and president of the supervisory board of the following Austrian companies:
Former investments of Androsch's holdings included majority stakes in Future Advanced Composite Components (FACC) AG in Ried im Innkreis
(acquired by Xi'an Aircraft Industrial Corporation
in 2009) and in KTM
Sportmotorcycle AG.
Androsch is also president of the supervisory board of the Austrian Institute of Technology (AIT; formerly Austrian Research Centers, ARC) in Seibersdorf
, chairman of the University Council of the University of Leoben
, and deputy chairman of the supervisory board of FIMBAG Finanzmarktbeteiligung AG, the vehicle through which the state-owned Österreichische Industrieholding controls its stakes in Austrian banking system.
Following the collapse of Refco
, a class-action lawsuitsuit in the US caused considerable difficulties for BAWAG P.S.K.
, the Austrian trade union's bank. Androsch and other Austrian investors formed a consortium with Cerberus Capital Management
, which acquired the bank in
2006.
In 2006 the Austrian economics magazine trend estimated Androsch's wealth at EUR 420 million, ranking him 25th among the wealthiest Austrians. Using a modified rating that also considered networking, the magazine ranked him the 22nd most powerful person in Austria's economy in 2009.
was held. It is dedicated to "the consolidation of social balance and peace." Androsch endowed it with EUR 1 million and committed himself to increase the annual budget to EUR 10 million until 2012. It awards the Hannes Androsch Prize (EUR 100,000 for 2011) for scientific contributions to its goals. According to the academy, this is the most important private non-profit foundation established in Austria since 1945.
Androsch is a member of the fundraising committee of the Institute of Molecular Biotechnology
, a joint initiative of the Austrian Academy of Sciences and the pharmaceutical company Boehringer Ingelheim.
Youth and early political activities
Hannes Androsch was born on April 18, 1938 in Vienna where his parents, Hans and Lia, were tax advisors in the district FloridsdorfFloridsdorf
Floridsdorf is the 21st district of Vienna, Austria .Floridsdorf is located in the northern part of Vienna.The District Office and the centre of Floridsdorf are located round Am Spitz, at the junction of Prager Straße and Brünner Straße .Since 2004, Floridsdorf has had its own tower: the...
. The family lived through the end of World War II in Southern Bohemia where they witnessed the expulsion of Germans from Czechoslovakia
Expulsion of Germans from Czechoslovakia
The expulsion of Germans from Czechoslovakia after World War II was part of a series of evacuations and expulsions of Germans from Central and Eastern Europe during and after World War II....
in June 1945. His mother placed seven-year old Hannes on the window sill and instructed him to watch the events closely so that he would never forget.
Hannes concluded his high school education in Vienna in 1956. He proceeded to study business administration at the College of International Trade (today's Vienna University of Economics and Business
Vienna University of Economics and Business
Wirtschaftsuniversität Wien or Vienna University of Economics and Business is the largest University focusing on business and economics in Europe and, in terms of student body, one of the largest universities in Austria...
) where he obtained his diploma in 1959, followed by a doctorate in 1969.
His political activities manifested early, and took him to the top position in the Vienna branch of the student organization of the Socialist party
Social Democratic Party of Austria
The Social Democratic Party of Austria is one of the oldest political parties in Austria. The SPÖ is one of the two major parties in Austria, and has ties to trade unions and the Austrian Chamber of Labour. The SPÖ is among the few mainstream European social-democratic parties that have preserved...
(1960–1961), and then to leadership of the national organization (1962–1963). Thereafter, at the age of only 25 years, he became secretary for economic issues in the club of the Socialist members of parliament, a position which he held until 1966.
Rise and fall as a politician
1967 was a fateful year for Hannes Androsch: he was certified as a public accountantCertified Public Accountant
Certified Public Accountant is the statutory title of qualified accountants in the United States who have passed the Uniform Certified Public Accountant Examination and have met additional state education and experience requirements for certification as a CPA...
and tax advisor, allowing him to participate in the financial consulting enterprise which his parents had significantly expanded; and he became a member of parliament for the Socialist party where he earned himself a reputation as a shooting star. When Bruno Kreisky
Bruno Kreisky
Bruno Kreisky was an Austrian politician who served as Foreign Minister from 1959 to 1966 and as Chancellor from 1970 to 1983. Aged 72 at the end of his chancellorship, he was the oldest acting Chancellor after World War II....
turned the tables on Austria's political scenery with the 1970 national election
Austrian legislative election, 1970
Parliamentary elections were held in Austria on 1 March 1970. The result was a victory for the Social Democratic Party, which won 81 of the 165 seats and was able to form a minority government that was tolerated by the Freedom Party of Austria in return for electoral reform that favoured smaller...
he made the 32-year old Androsch Finance minister
Finance minister
The finance minister is a cabinet position in a government.A minister of finance has many different jobs in a government. He or she helps form the government budget, stimulate the economy, and control finances...
in his first minority cabinet on April 21, 1970. Androsch continued in this function when the Socialst single-party government consolidated its dominance through the absolute majorities won in the elections of 1971 and 1975. Although he had not been Kreisky's first choice for this position (Schachner-Blazizek and Felix Slavik had declined) the two men developed a working relationship that was, initially, very good. Androsch became a strong advocate of Keynesian economics
Keynesian economics
Keynesian economics is a school of macroeconomic thought based on the ideas of 20th-century English economist John Maynard Keynes.Keynesian economics argues that private sector decisions sometimes lead to inefficient macroeconomic outcomes and, therefore, advocates active policy responses by the...
, in a modification that became known as “Austro-Keynesianism.”
On October 1, 1976 Androsch was made Vice-Chancellor of Austria while remaining minister of finance. In this capacity he became chairman of the OECD
Organisation for Economic Co-operation and Development
The Organisation for Economic Co-operation and Development is an international economic organisation of 34 countries founded in 1961 to stimulate economic progress and world trade...
at ministerial level in 1979, and also served as chairman of the Interim Committee of the International Monetary Fund
International Monetary Fund
The International Monetary Fund is an organization of 187 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world...
.
While Androsch had built an excellent political network within the centrist wing of the Socialist party and especially the Austrian Trade Union Federation
Austrian Trade Union Federation
-External links:*...
(ÖGB), not everybody was happy with his rapid rise. The fact that the Austrian print media, who for the most part venerated Kreisky and had adorned him with the nickname "Sun King," started to refer to Androsch as the "Crown Prince" did not help. When in 1975 Androsch differed with Kreisky on how to handle the reconfiguration of Austria's state-owned industry, and expressed his wish to become president of the national bank
instead of continuing in the government, Kreisky himself became suspicious of the young man he had mentored for years. He started to take exception to a highly problematic incompatibility that had been public knowledge since Androsch became a member of the government: he still owned the tax advisor company (renamed Consultatio in 1970) which he had taken over from his parents, although he had placed it in escrow
Escrow
An escrow is:* an arrangement made under contractual provisions between transacting parties, whereby an independent trusted third party receives and disburses money and/or documents for the transacting parties, with the timing of such disbursement by the third party dependent on the fulfillment of...
when he became a finance minister.
Towards the end of 1980, after long and intense campaigns by Austria's media and a continued deterioration of his relationship with Kreisky, Androsch resigned from his political positions on January 20, 1981.
Second career as a banker
The government appointed Hannes Androsch as the governor of the state-owned CreditanstaltCreditanstalt
The Creditanstalt was an Austrian bank. The Creditanstalt was based in Vienna, founded in 1855 as K. k. priv. Österreichische Credit-Anstalt für Handel und Gewerbe by the Rothschild family...
, Austria’s leading bank at that time, a little later in 1981. However, he continued to face heavy opposition and revelations made by investigative journalists (especially Alfred Worm
Alfred Worm
Alfred Worm was an Austrian journalist, author and university professor.-Career:...
) that culminated in a series of investigations of his personal financial conduct which in part predated his public role or were not demonstrably connected with it. Androsch has repeatedly stated (and has repeated these allegiations in a series of interviews published by the Austrian newspaper "Die Presse" in February and March 2010; see sources) that his Socialist successors in the finance ministry, Herbert Salcher and Franz Vranitzky
Franz Vranitzky
Franz Vranitzky is an Austrian politician. A member of the Social Democratic Party of Austria , he was Chancellor of Austria from 1986 to 1997.-Early life and career:...
(who had been Androsch's secretary, and would later rise to chancellorship) had conspired with Kreisky "who was simply jealous" (and with political opponent Alois Mock
Alois Mock
Alois Mock is a politician and member of the Austrian People's Party . He was Vice Chancellor of Austria from 1987 to 1989. As foreign minister he helped take Austria into the European Union....
) to "construe the financial and legal proceedings against him" that would not be finally settled for the following 16 years. "I had no chance to even be heard. And many who have participated in this vendetta would now rather pretend that nothing had ever happened."
A central point of Androsch's defence concerning his personal finances—he claimed that a rich "uncle-by-choice" ("Wahlonkel" in German) had provided him with significant funds, and habitually replied "alas, no" when asked if the was a millionnaire—did not hold. On October 8, 1991 Androsch was convicted by the Vienna Regional Criminal Court of having evaded taxes between 1974 and 1983 in the amount of about five million Austrian Schilling (roughly corresponding to EUR 500,000 expressed in 2010 currency), a minuscule fraction of the original allegiations. He was sentenced to a fine of 1.8 million Austrian Schillings.
A legally separate but politically related affair (a conviction for false testimony to the parliamentary examination board investigating the scandal surrounding the Vienna General Hospital
Vienna General Hospital
The Vienna General Hospital is the University medical center of the city of Vienna, Austria. The AKH is the largest hospital of Austria and Europe, the second largest hospital in the world, and at 85-m high is one of the tallest hospital buildings in the world...
) forced Androsch to resign from the Creditanstalt post in January 1988. With the help of a Swiss member of the Bilderberg Group
Bilderberg Group
The Bilderberg Group, Bilderberg conference, or Bilderberg Club is an annual, unofficial, invitation-only conference of approximately 120 to 140 guests from North America and Western Europe, most of whom are people of influence. About one-third are from government and politics, and two-thirds from...
, he became a consultant to the World Bank
World Bank
The World Bank is an international financial institution that provides loans to developing countries for capital programmes.The World Bank's official goal is the reduction of poverty...
, especially for China and parts of Africa, until 1989.
Third career as an industrial investor
In 1989 Hannes Androsch founded AIC Androsch International Management Consulting GmbH which in 1994 commenced its corporate investment and acquisition activity. Its offices are situated at the Ringstraße, opposite the Vienna opera house.By way of AIC, Hannes Androsch is co-owner and president of the supervisory board of the following Austrian companies:
- Austria Technologie und Systemtechnik (AT&S) AG, Europe's largest manufacturer of printed circuit boards with offices in Vienna and LeobenLeobenLeoben is a Styrian city in central Austria, located by the Mur river. With a population of about 25,000 it is a local industrial center and hosts the University of Leoben which specialises in mining...
- Salinen Austria AG, Austria's salt mining and processing company and a significant player in Europe
- bwin.com Interactive Entertainment AG, a developer and marketer of online gamblingOnline gamblingOnline gambling, also known as Internet gambling and iGambling, is a general term for gambling using the Internet.-Online poker:Online poker tables commonly offer Texas hold 'em, Omaha, Seven-card stud, razz, HORSE and other game types in both tournament and ring game structures...
and gaming products in Vienna
Former investments of Androsch's holdings included majority stakes in Future Advanced Composite Components (FACC) AG in Ried im Innkreis
Ried im Innkreis
Ried im Innkreis is a town in the state of Upper Austria in Austria, approximately 70 km west of Linz and 60 km north of Salzburg...
(acquired by Xi'an Aircraft Industrial Corporation
Xi'an Aircraft Industrial Corporation
Xi'an Aircraft Industrial Corporation , also known as Xi'an Aircraft Company Limited is a Chinese aircraft manufacturer and developer of large and medium-sized airplanes. It is based in Yanliang District, Xi'an, Shaanxi Province. It is joint partners with 603rd Aircraft Design Institute of...
in 2009) and in KTM
KTM
KTM Sportmotorcycle AG is an Austrian motorcycle, bicycle and moped manufacturer.The company was founded in 1934 by engineer Hans Trunkenpolz in Mattighofen. It started out as a metal working shop and was named Kraftfahrzeuge Trunkenpolz Mattighofen...
Sportmotorcycle AG.
Androsch is also president of the supervisory board of the Austrian Institute of Technology (AIT; formerly Austrian Research Centers, ARC) in Seibersdorf
Seibersdorf
Seibersdorf is an Austrian market town with 1,283 residents in the District of Baden in Lower Austria.-Geography:Seibersdorf lies in the industrial belt of Lower Austria...
, chairman of the University Council of the University of Leoben
University of Leoben
The University of Leoben, in the town of Leoben, Austria, is the country's university for mining, metallurgy, and materials.It was founded on 4 November 1840, as the Steiermärkisch-Ständische Montanlehranstalt in Styria, Austria's mining region. In 1848 Peter Tunner relocated the university to the...
, and deputy chairman of the supervisory board of FIMBAG Finanzmarktbeteiligung AG, the vehicle through which the state-owned Österreichische Industrieholding controls its stakes in Austrian banking system.
Following the collapse of Refco
Refco
Refco was a New York-based financial services company, primarily known as a broker of commodities and futures contracts. It was founded in 1969 as "Ray E. Friedman and Co." Prior to its collapse in October, 2005, the firm had over $4 billion in approximately 200,000 customer accounts, and it was...
, a class-action lawsuitsuit in the US caused considerable difficulties for BAWAG P.S.K.
BAWAG P.S.K.
BAWAG P.S.K. Bank für Arbeit und Wirtschaft und Österreichische Postsparkasse Aktiengesellschaft is the fourth largest bank in Austria...
, the Austrian trade union's bank. Androsch and other Austrian investors formed a consortium with Cerberus Capital Management
Cerberus Capital Management
Cerberus Capital Management, L.P. is one of the largest private equity investment firms in the United States. The firm is based in New York City, and run by -year-old financier Steve Feinberg. Former U.S...
, which acquired the bank in
2006.
In 2006 the Austrian economics magazine trend estimated Androsch's wealth at EUR 420 million, ranking him 25th among the wealthiest Austrians. Using a modified rating that also considered networking, the magazine ranked him the 22nd most powerful person in Austria's economy in 2009.
Research sponsorships
On 21 June 2004, the founding session of the Hannes Androsch Foundation within the Austrian Academy of SciencesAustrian Academy of Sciences
The Austrian Academy of Sciences is a legal entity under the special protection of the Federal Republic of Austria. According to the statutes of the Academy its mission is to promote the sciences and humanities in every respect and in every field, particularly in fundamental research...
was held. It is dedicated to "the consolidation of social balance and peace." Androsch endowed it with EUR 1 million and committed himself to increase the annual budget to EUR 10 million until 2012. It awards the Hannes Androsch Prize (EUR 100,000 for 2011) for scientific contributions to its goals. According to the academy, this is the most important private non-profit foundation established in Austria since 1945.
Androsch is a member of the fundraising committee of the Institute of Molecular Biotechnology
Institute of Molecular Biotechnology
The Institute of Molecular Biotechnology is an independent research organisation founded as a joint initiative of the Austrian Academy of Sciences in cooperation with the company Boehringer Ingelheim an international pharmaceutical company with headquarters in Germany...
, a joint initiative of the Austrian Academy of Sciences and the pharmaceutical company Boehringer Ingelheim.
Honors
Hannes Androsch has been awarded a significant number of international honors, among them an honorary doctorate in economics from the University of New OrleansUniversity of New Orleans
The University of New Orleans, often referred to locally as UNO, is a medium-sized public urban university located on the New Orleans Lakefront within New Orleans, Louisiana, United States. It is a member of the LSU System and the Urban 13 association. Currently UNO is without a proper chancellor...
Sources
- Androsch biography at the website of the Austrian Parliament
- Androsch biography by Robert Sterk (German)
- "Es war nie eine Vater-Sohn-Beziehung" (It never was a father-son relationship"). Interview given to the newspaper Die Presse, February 28, 2010
- "Der Kanzler war einfach eifersüchtig" ("The chancellor was simply jealous"). Interview given to the newspaper Die Presse, March 20, 2010
- "Da hast du keine Chance gehabt" (You've never had a chance"). Interview given to the newspaper Die Presse, March 27, 2010
External links
- AIC website (identical with www.androsch.com)
- Hannes Androsch website
- bwin website
- AT&S website
- Salinen Austria website
- FACC website