What's new

Welcome to Japan Reference (JREF) - the community for all Things Japanese.

Join Today! It is fast, simple, and FREE!

News Toshiba and J-gov colluded against (foreign) investors

thomas

Unswerving cyclist
Admin
Joined
14 Mar 2002
Messages
11,063
Reaction score
2,331
Get your popcorn ready. 🍿 The next Toshiba scandal is brewing. The Old Guard tried to have it their way.

It started last Thursday when the report of an independent investigation was released:

Toshiba Corp and Japan's government colluded to lean on foreign investors to back company management in a key vote, according to an investigation which alleged one executive said they would ask the trade ministry to "beat up" a hedge fund. The shareholder-commissioned report released on Thursday also said that Yoshihide Suga - then chief cabinet secretary and now prime minister - verbally encouraged the pressure on investors during a meeting with a senior Toshiba executive last year, an allegation Suga has denied.


I hope PM Suga enjoys his tête-à-têtes at the G7 summit. The local media will likely jog his mind next week.

Then, on Friday, four foreign Toshiba directors demanded the resignations: both board and management changes were needed, they said, calling some parts of the report "deeply disturbing".

Four Toshiba Corp directors called on Friday for a shake-up of its management and board, in a sign of revolt after an investigation found the conglomerate colluded with the Japanese government to "beat up" foreign shareholders. The very public push-back by the independent directors, all non-Japanese, is the latest twist in a scandal that shows how the old guard of Japan Inc, while still powerful, can no longer exert full control over shareholders. It comes a day after an explosive, shareholder-commissioned investigation revealed - in startling detail rare for such probes in corporate Japan - how management reached out to the powerful Ministry of Economy, Trade and Industry (METI) to strong-arm activist investors.


And today, Toshiba's second-biggest shareholder also demanded the board chairman and three other directors resign immediately.


And Toshiba? Declined to comment. They must have had a busy weekend.
 
  • Thread starter
  • Admin
  • #2

thomas

Unswerving cyclist
Admin
Joined
14 Mar 2002
Messages
11,063
Reaction score
2,331
Last Sunday, Toshiba admitted wrongdoing and blamed the - former - CEO. The head of METI, industry minister Kajiyama on the other hand sees no need to investigate the Toshiba scandal. 😲

hiroshi-kajiyama.jpg


“The ministry did the right thing,” he said at a news conference, adding that the exchanges were part of the ministry's policy “to maintain the stable development of important businesses and technologies that Toshiba carries out.” Regarding an investigative report drafted by third-party lawyers, “It made some points that I take exception to regarding the facts,” he said. Kajiyama dismissed the possibility of disciplining ministry employees who were involved. He also said the ministry will not conduct its own investigation. The investigative report said that top ministry officials colluded to leak information of foreign shareholders and others to Toshiba, a possible breach of confidentiality and a violation of the National Civil Service Law. “There is no need to check if each and every action of ministry employees is deemed to be a breach of confidentiality or not,” Kajiyama said.

How convenient to be a bureaucrat in Japan.

 
  • Thread starter
  • Admin
  • #4

thomas

Unswerving cyclist
Admin
Joined
14 Mar 2002
Messages
11,063
Reaction score
2,331
Yesterday saw a victory for Toshiba's "activist investors" and a blow to Japan Inc: board chairman Nagayama wasn't reappointed.

In a rare move and a victory for activist investors, Toshiba Corp. shareholders voted down the reappointment of the board chairman at the annual shareholders meeting on Friday. [...] Investors ousted Osamu Nagayama, who had expressed his intention to stay on to tackle Toshiba’s deep-rooted governance issues. A recent probe by lawyers showed that the conglomerate had sought help from the government to influence the voting behavior of foreign shareholders. Of the 11 director candidates Toshiba proposed, shareholders rejected Nagayama and Nobuyuki Kobayashi, an audit committee member who was also up for reappointment. Following the surprise turn of events, foreign investors frustrated over Toshiba’s flawed management are likely to have a bigger say on the firm’s business.


The board said it would undertake a full review of assets and devise a plan to create growth via dividends and buying back shares. It would also engage with potential investors, it said, comments that could spark tension with the government, which regards Toshiba as a strategic asset. CEO Satoshi Tsunakawa was appointed as interim chairman, the company said, adding it recognised the seriousness of the rejection of the two directors.

 
Top Bottom