Former Landsvirkjun chief warned of political interference; the company’s board rejects the accusations

The governance dispute at Landsvirkjun, the Icelandic state-owned power company, became public on Monday evening, 2 November. At 18:00, on the programme Spegillinn, RÚV presented documents from the correspondence between the Ministry of Finance and Economic Affairs, the board and former CEO Hörður Arnarson, and the board responded with a statement published on the company’s website.

What the former CEO wrote. According to RÚV, Hörður began raising objections at the end of last year about the way the board and the ministry were working. In a memo from June, he warned that increasingly frequent meetings between the ministry and the board outside annual general meetings risked being interpreted as political interference; if the EFTA Surveillance Authority (ESA) saw them that way, the company could become dysfunctional, because major decisions would have to be sent to ESA. According to Morgunblaðið, minister Daði Már Kristófersson met the board on 6 January without the CEO being present.

What the board says. In its statement, the board says it took the remarks seriously, obtained an independent legal opinion and that “the review has not shown that the board of Landsvirkjun has gone beyond its statutory role or powers”. Since it took office in April 2025, there have been nine meetings with the ministry, focused on profitability, dividends and capital structure, and the CEO or his deputy attended when operations were discussed. The board says it met twice without him, when his own remarks were being discussed, and that it has not interfered in day-to-day operations.

Context. According to RÚV, Hörður announced his departure at the beginning of October, citing a lack of trust, after about 17 years at the helm; his deputy is serving on an interim basis until a new CEO is appointed. Morgunblaðið writes that the 6 January meeting also discussed the dispute between Landsvirkjun and grid operator Landsnet, with the minister considering it unfortunate that it was playing out in the media. An internal ministry email of 11 September noted that “there seems to be little trust on both sides” and mentioned that the board was working with Boston Consulting on a new strategy focused on efficiency.

What comes next. Landsvirkjun is due to appoint a new CEO. The board, chaired by Brynja Baldursdóttir, says decisions are taken at board meetings “on a commercial basis” and that it will remain independent, with the long-term interests of the company and society at the forefront.

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