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Ex-Olympus CEO says firm's board should quit

Ex-Olympus CEO says firm's board should quit

Write: Xenophon [2011-11-27]

Ex-Olympus CEO says firm's board should quit

Former Olympus CEO Michael Woodford gestures at a Tokyo news conference about the Japanese firm's accounting scandal yesterday. Woodford said that while he was ready to return as president, he would also be willing to walk away if Olympus and its shareholders do not want him back. Woodford said after yesterday's board meeting that the top priority was for Olympus to meet a December 14 deadline for filing its financial statements for the six months to September. The company would be automatically delisted if it misses the deadline. [Photo: Reuters via Shanghai Daily]

The former Olympus Corp. CEO Michael Woodford said a meeting with the firm's board of directors on Friday was constructive but insisted the board step down to account for the disgraced firm's involvement in massive accounting coverups.

Woodford met wit his board of directors at Olympus for the first time since he was ousted as the company's president on Oct. 14 for blowing the whistle on the optical and life sciences equipment maker's acquisition of British firm Gyrus Group Plc. and the inordinately high fees paid to little-known consultants based in the Cayman Islands.

"There's also an understanding that these people cannot continue as directors, and it will get to a point, hopefully in the near future, that they will stand down, allowing Olympus to move forward," said Woodford at a news conference in Tokyo following his meeting with the board.

The company's former Chairman Tsuyoshi Kikukawa resigned from the board on Friday, while auditor Hideo Yamada and Executive Vice President Hisashi Mori have both been sacked from the scandal-hit firm.

Despite large shareholders calling for Woodford to be reinstated as the firm's chief, the former CEO said the board remained muted on the subject and that he himself, while willing to take on the job, was not prepared to beg.

"I'm not begging to come back," he said, though he added that he was willing to do so if shareholders desired it. "I didn't volunteer for this, I'm not a hero," he added.

Woodford said that while the meeting was tense, devoid of handshakes and apologies, all members were in agreement that it would be in the best interest of the firm going forward and its shareholders if the firm were not to be delisted from the Tokyo Stock Exchange (TSE).

"They didn't shake my hand and I didn't offer mine. But there is clearly a shared desire that the company's not delisted," Woodford said.

"The strength of Olympus is its people and engineering," Woodford added. He also said that if the firm were delisted it would be "a terrible thing for the shareholders and employees."

Now it is imperative for Olympus to ensure that it reports the last six months of its financial reports by December 14 or the 92- year-old company will be automatically delisted making it highly vulnerable to a takeover.

On Nov. 8 Olympus Corp. for the first time admitted that some of its executives had deliberately concealed decades of losses by paying advisors exorbitant fees.

Prior to that Olympus had denied all accusations and dismissed their ousting of Woodford claiming that the CEO, who had been with the Japanese group for 30 years, didn't understand Japanese business culture or the firm's management style.

But today Woodford maintained that he was ousted solely for blowing the whistle on the firm's coverups and he alluded to a culture of deceit that may exist beyond just Olympus and permeate deep into the upper echelons of corporate Japan.

"The Olympus scandal may be a reflection of how Japanese companies operate under their own set of rules when it comes to corporate governance," Woodford said.

"Although I hope Olympus is an exception," he said.

Following his meetings in Tokyo, Woodford is scheduled to travel to the United States for talks with authorities there investigating the scandal-plagued firm.