Lawyer, not exec, picked as utility's next chairman

Bailout official to head Tepco

Kyodo, Bloomberg

Prime Minister Yoshihiko Noda on Thursday tapped Kazuhiko Shimokobe, head of the decision-making board of the public entity that is providing financial aid to Tokyo Electric Power Co., as the utility’s next chairman.

Shimokobe accepted Noda’s request.

The 64-year-old lawyer will have to take a leading role in turning Tepco around as it struggles in the aftermath of the crisis at the Fukushima No. 1 nuclear power plant.

Noda formally made the request to Shimokobe during a meeting Thursday afternoon at the prime minister’s office.

The government had been looking for a prominent business figure to succeed Tsunehisa Katsumata, 72, but instead ended up choosing someone who is already deeply involved in Tepco’s management issues, sources said.

Shimokobe headed a panel of experts that compiled a report for the government in October about the utility’s financial standing and is currently one of the seven members of the decision-making board of the Nuclear Damage Liability Facilitation Fund.

The difficulty finding a new chairman is one reason why Tepco’s comprehensive restructuring plan, which will feature a public fund injection of ¥1 trillion, has been delayed.

Minister of Economy, Trade and Industry Yukio Edano, who has the authority to approve the plan, has said he wants Tepco to clarify management responsibility based on the concept that the utility needs to start over from scratch.

Katsumata has served as Tepco’s chairman since June 2008. He and President Toshio Nishizawa are likely to step down at the annual shareholders’ meeting in late June. The next president is expected to come from inside Tepco.

“The Tepco chairman’s job is like a hot chestnut in a fire, nobody wants to pick it up and get burned,” Hirofumi Kawachi, an analyst at Mizuho Investors Securities Co. said. “Drawing up plans to restructure Tepco is obviously much harder than it is for other failed companies.”