Olympus Corp. said Tuesday the damages suit it filed two days earlier is targeting 19 current and former top executives, demanding that they pay a combined ¥3.61 billion in compensation for losses dozens of times greater caused by the coverup of massive failed investments.
The camera and endoscope maker is particularly blaming ex-Chairman and President Tsuyoshi Kikukawa, as well as current President Shuichi Takayama.
An investigation report examining the degree of responsibility held by the former and current executives said the company suffered losses of ¥85.9 billion, including illegal dividends that had been paid even though it had no distributable profits as a result of the accounting fraud.
The report compiled by a panel of lawyers says Kikukawa can be held responsible for all of the losses. Of those who led the coverup, Executive Vice President Hisashi Mori should be held accountable for about ¥70.0 billion and former Olympus auditor Hideo Yamada about ¥73.9 billion, the report says.
The panel said current board members including Takayama are responsible for ¥4.7 billion in losses, but the firm cut the total compensation sought to ¥3.61 billion, taking into consideration the executives’ ability to pay.
Olympus said Takayama and five other current board members who face paying damages plan to resign at an extraordinary shareholders’ meeting slated for March or April.
On Saturday when the report was submitted to the company, Takayama conveyed to other board members his intention to step down by the end of this month, according to sources.
But the company is still making arrangements on the timing of his resignation as some major shareholders of Olympus and financial institutions say Takayama should remain as president until the shareholder meeting, the sources said.
According to the report, Takayama and other board members gave the nod at a board meeting to decide on the purchases of three Japanese firms that were used to cover up the past investment losses.
The report said the board members were responsible for failing to prevent the company from engaging in fraudulent accounting, stating, “No information-gathering, analysis or consideration was conducted sufficiently and there was a careless error in the management’s judgment.”