EMERGING

EMERGING MARKETS:
A Review of Business and Legal Issues
those companies increased much faster within the last 3 years. Siemens share price in this
period increased by around 60%, as did the share prices of Philips, Honeywell or General
Electric Inc. (in this case only by approx. 10%). At the same time the price of NOKIA shares
increased by 120%, of ABB by 350%, and of Alstom by 550%. Investors disposed of the
shares of other technological companies such as Alcatel Lucent, whose share price was 50%
lower than 3 years ago, as well as Nortel (-70%), Toshiba (-60%) or Ericsson (-20%).
Chart 3. Quotations of Siemens AG shares (orange line)
on the German XETRA exchange against the changes of DAX index (blue
line, where Siemens has the weight of 10) and Dow Jones index (green), 1
December 2006 = 100.
Source: Handelsblatt.com, courtesy of Handelsblatt.
The strategy of the founders
Over 160 years ago the partnership of Siemens and Halske began from the production of
needle telegraphs, which, along with the construction of cable installations, soon became the
leading product in an increasing range of products based on the company’s own innovations.
As it usually happens with innovations, they drew orders from the army and public authorities
of all levels, which later became a characteristic feature of the strategy of the company. Along
with the development of the company, the links between the company and the administration
Page 37 Volume 1, April 2009