There are ways to prevent corporate scandals, and the key to prevention is the attitude of corporate executives, according to an executive at Japan's largest economic organization.
If something happens that could cause a scandal, it is important for a company to disclose information even though it could affect the firm's image and business, said Ryukoh Wada, senior managing director of the Japan Federation of Economic Organizations (Keidanren).
"Even if the company succeeded in hiding the information, it could easily become a target of a 'sokaiya' corporate extortionist," Wada said. Earlier this month, Keidanren suspended Dai-Ichi Kangyo Bank and Nomura Securities Co. from members' activities for six months due to their deals with sokaiya racketeers. The decision was in accordance with the federation's Charter for Good Corporate Behavior, which is based on 10 principles concerning company behavior.