Exposure: Finally, out of the Olympus scandal and into the sunlight
Revenge is sweet and not fattening, Alfred Hitchcock once said. Michael Woodford might second that, today, July 3. This morning, his former colleagues at Olympus were sentenced for their role in the $1.7-billion fraud and corruption he exposed.
But Mr Woodford seems too enlightened to stoop to petty revenge. On the BBC this morning, the man who blew the whistle on Olympus, indicated that he feels vindicated by events – but crucially, not pleased as punch.
A lesser man might have savoured the sweet taste of bitterness. Weeks after Mr Woodord was appointed chief executive of the venerable Japanese company (that was in 2011, after 30 years of rising through Olympus’s ranks) he courageously told the world about the massive fraud and corruption he’d discovered at the highest levels of management. Chillingly, there was an alleged link to the yakuza, the Japanese mafia and Mr Woodford was forced out of his job and reduced to fleeing the country amid fears for his life.
He bravely took his story to the media and pursued the campaign with energy and determination. The entire Olympus board was sacked and Mr Woodford managed to squeeze a £10-million settlement from the company, got a book deal that led to the non-fiction thriller ‘Exposure’, which went into paperback yesterday, July 2, and will, apparently, soon be made into a film. Today, Olympus chairman Tsuyoshi Kikukawa (who humiliated and ignored Mr Woodford when he tried to raise his concerns) received a suspended sentence for his role in the fraud along with a former executive vice president and former auditing officer.
Meanwhile, Michael Woodford Associates appears to be doing just fine advising big companies on corporate governance and building an ethical culture and providing pointers to western fund managers on investing in Japan. The Evening Standard newspaper reports Mr Woodford lamenting 21st-century Japan’s ossified business culture. He points out that the Panasonics and Nissans of the past were world-changers and innovators because they dared to be different. But today, Japan’s big investment houses squeeze out entrepreneurialism, strict labour laws prevent companies from reforming, weak companies never get taken over but just limp along. “Japan has this highly skilled workforce but the creative side has been totally repressed,” the paper reports Mr Woodford to say.
Not so the Liverpool salesman (of Tamil ancestry) who rose to the highest ranks of the insular Japanese corporate world, broke through the soundproof wall of boardroom complicity and eventually triumphed.