Seven years after corporate Japan was turned on its head when Olympus Corp. became the subject of a massive accounting scandal, a member of the company’s legal team believes nothing has changed — and things may have actually gotten worse.
At a news conference Wednesday, lawyer Hiroki Sakakibara rebuked the firm’s current leadership for its inability to rectify the company’s past mistakes and blaze a new path.
Despite multiple ongoing scandals, some of which are being investigated by the United States Department of Justice, Sakakibara insisted that the company is failing to properly manage itself and has even retaliated against those who object to its apparent foot-dragging on needed drastic reforms that would bring transparency.
One of those targeted has been Sakakibara himself, he alleged.
“I strongly hope the management should do their job, take the responsibility and do the right thing for the company to avoid tragedy,” he said.
The maker of endoscopes and cameras has been mired in scandal for years.
In 2011, then-CEO Michael Woodford exposed accounting dealings in which board executives were hiding their losses by using offshore accounts, among other methods.
What followed quickly became what many considered at the time to be the biggest scandal in Japanese corporate history. The revelations grew into a corporate corruption scandal that uncovered the concealment of more than ¥117.7 billion in investment payments and losses dating back to the late 1980s.
According to Sakakibara, the issues brought to light by the scandal preceded 2011 and Olympus has yet to address them.
Not only that, other issues also went unnoticed, he said.
“Even though Olympus promised to reveal its corporate governance after the 2011 scandal, the company hasn’t changed and maybe it’s still getting worse,” Sakakibara said.
The U.S. Department of Justice is also investigating Olympus, having issued a subpoena in 2015 over the company’s duodenoscope — a lighted tube used to help treat problems in the digestive system — that is suspected of having played a role in the spread of a superbug in U.S. hospitals.
With the subpoena, Sakakibara said he feels the Justice Department is “implicitly” questioning Olympus’ attitude in corporate governance.
The firm’s subsidiary is also alleged to have made illicit payments to customs officials in Shenzhen, China. While an internal probe uncovered no wrongdoing, Sakakibara disputed the conclusion.
During the news conference, Sakakibara condemned the company’s leadership, which was reshuffled following the 2011 scandal, for failing to implement corporate governance reforms despite recommendations by experts. He also criticized the management for attempting to silence critics, including Shuichi Oda, an official who was transferred to an unknown division in what Sakakibara called an “unusual” move.
Sakakibara himself filed a lawsuit with the Tokyo District Court in January alleging that the company ignored his recommendations to further investigate the issues leading up to the 2011 scandal.
Sakakibara alleged that the company threatened to deny access to his employee email account and locked him out of the Shibuya Ward office where he works in Tokyo.
“My ultimate goal in my lawsuit is trying to describe the potential violation of law in the Shenzhen bribery and the company’s actions against those men … and again, the actions against myself for voicing that legal action,” Sakakibara said.
“This is my last job at Olympus,” he jokingly added.
Sakakibara’s next court hearing will be held on Dec. 10 in the Tokyo District Court.
IN FIVE EASY PIECES WITH TAKE 5