Tokyo press spellbound by Woodford

November 27th, 2011

Majirox News
By Joe Peters
Nov. 27, 2011

Speaking before a standing room only crowd at the Foreign Correspondents’’ Club in Japan on Nov. 25, Michael Woodford, the 30-year veteran bottom-to-top success story at Olympus, held the audience spellbound as he explained his ouster from the company just a few weeks before.

Woodford, who is still a director of the company, arrived in Japan from London on Nov. 23 for a board meeting, press conferences and meetings with the regulators.

Woodford joined Olympus at the age of 21 when he responded to an advertisement for staff. In April 2011, he was appointed president and CEO of the Japanese company by former Chairman and President Tsuyoshi Kikukawa. Kikukawa said there were so many things wrong that needed to be put right and Woodford was the man to do it. On Oct. 14, Woodford was fired by Kikukawa.

Woodford said that the “how what and who” of the company’s losses were still unknown. Olympus made $400 million last year, but spent over $1.5 billion on acquisitions and related fees.

Woodford’s story unfolds on July 29, 2011
After I returned from an overseas trip,” he said, “the atmosphere towards me in the (Tokyo) office was off.”

The reason was that his colleagues knew about the cover-up of the company’s losses, but Kikukawa had told them not to show anything to Woodford.

The Japanese magazine Factiva had exposed the scandal in July. Kikukawa told Woodford the piece was mostly true. Executive Vice President Hisashi Mori (now resigned) said that he was loyal to Kikukawa and refused to answer Woodford’s questions.

“The deals I questioned were made for small companies with no turnover,” he said. “For example, a face cream company, a company that makes microwaveable plastic plates and a recycling company.”

On Sept. 23, Woodford wrote a letter to Mori, copied to board members about his concerns about various transactions (acquisitions). Mori replied that it was covered in a 2009 independent review. Woodford replied that was unsatisfactory. After he had written three letters, Kikukawa stepped in on the discussions. From that point on, Woodford copied Ernst and Young and board on all letters he wrote.

Then he called for Kikukawa and Mori to resign.

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