Former director calls for reinstatement of ousted Olympus CEO Woodford

By Miwa Suzuki , AFP

TOKYO–Japan’s Olympus must bring its wrongdoing out into the open and ousted CEO Michael Woodford is the only man who can do it, a former director said as he sought to rally support to reinstate the Briton. The comments from former board director Koji Miyata come as Olympus faces increasing pressure after revealing last week that it covered up investment losses dating back to the 1990s with inflated acquisition fees.

Olympus shares have lost around 80 percent of their value since Oct. 14, when Woodford was ousted. It has been warned of possible delisting by the Tokyo Stock Exchange, and the government has spoken out to limit fallout on markets. The Briton said he was dismissed after he alleged overpayments in a series of acquisition deals and called on the then-chairman to resign.

Miyata said he has started a campaign to reinstate him — he set up a pro-Woodford website on Saturday — calling his performance as president “an inconvenient truth” for the company.

In a message on the website addressed to all Olympus employees, Miyata, a 70-year-old former senior managing director, said he took action as he was “unwilling to sit passively and witness the demise of a company that I love.” “Friends, the Good Ship Olympus is listing and is in real danger of sinking … Don’t think for a moment that our endoscopic business is somehow indestructible,” said the former head of the firm’s medical systems business. “No customer wants to purchase endoscopes or any products from a company regarded as corrupt,” he said. “Winning people’s trust will depend on reinstating Michael Woodford as president,” he said, arguing his return would be crucial to making “wide-ranging and surely painful restructuring.” Miyata said Olympus’s “horrific corporate governance” has become globally emblematic of Japanese corporations and the company only has a brief window of opportunity to demonstrate that what has happened will not recur. The website said Monday it had stopped displaying names of supporters due to a “larger-than-expected response.” The company said on Monday it was doing its best to get to the truth through a probe by a third-party panel. “We will take investigation results from the third-party panel sincerely, take stern measures and push with reforms,” company spokesman Yoshiaki Yamada said. Miyata’s call echoes that of major Olympus shareholders such as investment firm Baillie Gifford who have also said they want for Woodford reinstated.

Olympus shares were untraded on Monday and bid only — meaning a glut of buyers — at an indicated value of 540 yen compared to Friday’s close of 460, amid confidence it will file its results by Dec. 14 to avoid delisting.

The Nikkei on Monday reported that Olympus had decided to correct its earnings reports for the past five years in the wake of the revelations that it has been covering up losses.

Japanese media have reported that Tokyo police and regulatory agencies are investigating, amid questions over the auditing firms that signed off on the company’s financial statements. Olympus has yet to reveal its losses, but media reports have said it may have concealed more than 100 billion yen (US$129 million). Woodford has said current managers involved in loss cover-ups should step down. “Those shameful individuals who brought this company to its knees need to go,” he told the TBS network in a recent interview.