Ten executives of housing equipment maker Lixil Group Corp. have joined forces to rebel against Chairman Yoichiro Ushioda, sources with knowledge of the matter said Wednesday.
The 10 executives sent a letter critical of founding family member Ushioda, also chief executive officer, to a member of Lixil Group’s nomination committee, according to the sources.
Also criticizing President and Chief Operating Officer Hirokazu Yamanashi as being unqualified for his corporate leadership role, the letter called for the return of former President and CEO Kinya Seto who was effectively dismissed by Ushioda.
The nomination committee is currently holding final discussions to set the list of director nominees that will be proposed at a general meeting of shareholders in June, the sources said.
The list will be made public as soon as it is decided.
“Ushioda’s vision is harmful to Lixil Group’s employees and shareholders,” the 10 executives said in the letter, asking the committee to choose the nominees without being influenced by the current top leadership.
At a news conference last month Ushioda announced his intention to take responsibility for the ousting of Seto, which triggered an internal feud. Ushioda promised to step down as board member on May 20 and as chairman and CEO after the shareholder meeting.
Yamanashi, whom Ushioda had proposed as Seto’s successor, also agreed to quit the board. But he said he would leave the nomination committee to decide whether he should stay as COO or in any other post.
Ushioda also told a meeting with analysts just after the news conference that he wants to give the post of CEO to Yamanashi.
That has raised concerns among those opposed to Ushioda, including Seto and some foreign institutional investors, that the chairman is trying to maintain his influence through Yamanashi.
At the shareholder meeting, Seto, who still sits on Lixil Group’s board, plans to propose a list of director nominees who support him.
The origins of Lixil Group go back to the 2001 business integration of aluminum sash maker Tostem Corp. and tile and toilet maker Inax Corp. Ushioda is from Tostem’s founding family.
Those opposed to Ushioda include board member Keiichiro Ina, from the Inax founding family.
The group has welcomed the 10 new rebels. “Leaders in the field have risked their jobs and raised their voices,” a source said. “The impact should be huge.”
The team hopes to win support from the nomination committee and a wide range of shareholders, sources said.
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