National

After criticism, Kepco weighs rules on executive punishment amid gift scandal

Kyodo

Kansai Electric Power Co. is considering introducing rules on punishments for executives following criticism of its leniency in the way six of them were reprimanded for receiving gifts from a former town official, sources close to the matter said Tuesday.

The Osaka-based utility is set to establish such rules also because President Shigeki Iwane has decided on punishment for himself in the scandal, in which 20 people at Kansai Electric received ¥318.45 million worth of gifts from the former deputy mayor of the town hosting one of its nuclear plants.

Last Wednesday, Kansai Electric subjected Chairman Makoto Yagi and former Deputy President Hideki Toyomatsu to a 20 percent cut in remuneration for two months for accepting ¥8.59 million and ¥110.57 million worth of gifts, respectively, from Eiji Moriyama, the late deputy mayor of the town of Takahama in Fukui Prefecture.

Iwane also had his remuneration cut by 20 percent for one month for receiving ¥1.5 million worth of gifts, but managing executive officer Satoshi Suzuki, who received the largest amount of ¥123.67 million, was simply given a stern warning along with two other executives.

The president and Yagi also declined to resign over the scandal, which has re-exposed the collusive ties between Japan’s nuclear industry and public officials.

At a news conference last Wednesday, reporters questioned the appropriateness of Kansai Electric’s punishments and the objectivity in the procedure for deciding on them.

“I should have discussed (the punishments) in a more objective way,” Iwane told reporters, acknowledging the company lacked clear rules and that the punishments were decided on a case-by-case basis.

Without specific rules on executive punishments, Iwane referred to a workplace regulation for general employees in deciding on the punitive actions, the sources said.

Iwane also had not consulted the audit committee beforehand and reported the planned executive punishments after deciding on them. He did not bring the matter for discussions at the board either, according to the sources.

Meanwhile, Economy, Trade and Industry Minister Isshu Sugawara on Tuesday criticized a Kansai Electric plan to have an independent panel compile its investigative report on the matter by the end of this year, calling the pace “too slow.”

“I will have the company report it as soon as possible,” Sugawara told a news conference. “(Setting the deadline) for year-end is outrageous.”

Also Tuesday, Kansai Electric Executive Vice President Koji Inada apologized to Kyoto Mayor Daisaku Kadokawa over the scandal. The municipal government is one of the utility’s major shareholders.

“It is outrageous that members responsible for management have received gifts,” Kadokawa said, noting that the electricity business is of a highly public nature.

Kansai Electric “must thoroughly get to the bottom (of the scandal) and take preventive steps. I hope it will also reform its corporate culture,” he said.

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