Siemens chief executive Klaus Kleinfeld has promised shareholders a full explanation about growing corruption allegations surrounding the German industrial giant.

But Mr Kleinfeld's promise, made at yesterday's annual shareholders' meeting, a day after it received a €423 million fine for price-fixing, was overshadowed by new allegations of corrupt practices going back to the 1980s.

"I suspect you feel the same way I do when you open the newspaper: dumbfounded," Mr Kleinfeld told 9,000 shareholders gathered in Munich.

Siemens has been under siege since November when the first allegations of corrupt business practices emerged: six current and former employees, including two top executives, have been detained by police. An investigation has already uncovered a complex network of post-office box companies in Switzerland and Liechtenstein and more than €400 million of bribes and other suspect payments allegedly made by Siemens employees to secure telecommunications contracts.

Mr Kleinfeld's predecessor as chief executive, Heinrich von Pierer, shrugged off responsibility yesterday for the bribery allegations, which took place during his time heading Siemens.

But Mr von Pierer, now head of the supervisory board, admitted that "essential anti-corruption measures" introduced during his watch had not been successful. "I find it personally extremely disturbing that these efforts were not sufficiently successful."

The affair has created problems for the board, already under pressure for giving members a 30 per cent pay rise while 3,000 employees of the Siemens mobile subsidiary were made redundant a year after it was sold off.

The EU fine, to be appealed by Siemens, resulted in a net profit fall of 16 per cent to €788 million in its most recent quarter to December. Overall, earnings improved, with a 51 per cent rise in operating profit to €1.631 billion.