Toshiba’s chief has vowed to fully investigate “unacceptable events” at the company as the industry veteran prepares to defend his position at next week’s annual shareholder meeting.
In an open letter to shareholders published after a week of escalating tensions between investors and the Japanese conglomerate’s management, Osamu Nagayama lamented the erosion of confidence in the company and introduced a series of urgent measures to improve governance.
His message comes a week after Toshiba’s reputation was damaged by a company independent report, which had been successfully requested by active shareholders, which concluded that the group’s 2020 general meeting had allegedly not taken place fairly and Collusion between the company and the government to suppress active contributors.
“In order to stop the recurrence, we will conduct an investigation, with the participation of a third party, into the cause of the unacceptable events, put in place new preventive measures, and establish a strong compliance culture,” Nagayama said in the letter published Friday.
He added that Toshiba would begin the search for new independent board members and would accelerate the search for a successor to Satoshi Tsunakawa, who has served as interim CEO since The sudden resignation of Nobuaki Kurumatani in April.
Nagayama’s message follows an online meeting he and Tsunakawa held on Wednesday with about 80 of the company’s shareholders.
“As President, my priority is to provide Toshiba with the governance and leadership it deserves,” Nagayama wrote. “I pledge to you that I will continue to be an agent of positive change, not a protector of the status quo.
Although Nagayama, a veteran of Sony and Chugai Pharmaceutical, joined Toshiba’s board after the events were revealed in the report, major investors and proxy advisory services called on shareholders to vote against his reappointment at the June 25 general assembly.
The main investor criticism of Nagayama centered on his position as chairman of the board at a time when Toshiba conducted its own internal investigation into allegations that last year’s annual meeting did not take place fairly. The investigation found no major problems, and it has since been denounced by major shareholders as a calculated vindication.
Toshiba said last Sunday that it would remove two of its nominations from the list of directors up for election next week — a move exceptionally rare for Japanese companies.
In a statement Thursday, Singapore-based secret fund Effissimo, the largest shareholder in Toshiba with a 9.9 percent stake, The panel was described as “ineffective”. But some investors have defended Nagayama, saying his actions since the report showed the kind of leadership the company needs in the crisis.
Prior to joining Toshiba’s board of directors last year, Nagayama was credited with turning Chugai into a global player through a capital partnership with Swiss company Roche in 2002. As Sony’s chairman since 2013, he has helped the entertainment group fend off a campaign Activist Daniel Loeb strengthened his management structure.