Michael Woodford may no longer be CEO of scandal-rocked camera and medical equipment maker Olympus, but he still has a seat on the company’s board. Attending the first board meeting since the company’s decade’s long financial scheme to hide losses came to light, Woodford described the board meeting as constructive and civilized as the company struggles to meet deadlines and retain its listing on the Tokyo Stock Exchange. But, he added, nobody shook his hand.
“There was a tension in the room, but there seemed to be an understanding that it was in no one’s interest to raise the temperature,” Woodford told the BBC. “They didn’t shake my hand and I didn’t offer mine.”
Immediately prior to the board meeting, three of the company’s directors resigned from the board, including Tsuyoshi Kikukawa—the company’s former CEO who resigned as chairman last month when the scandal broke—along with the company’s former vice-president and auditor.
According to Woodford, the company’s goal now is to avoid being delisted from the Tokyo Stock Exchange. Olympus has until December 14 to report its earnings after missing a November 14 deadline to report. If the company misses the 30-day extension, it will be served a notice of delisting, after which investors may continue to trade shares for one month. After that, the company would be removed from the exchange—no further extensions are allowed.
The three resignations from the company’s board gives Olympus chance to appoint new directors that haven’t been tainted by the financial fraud scandal, an potentially get the company back on a solid footing. Olympus’s stock price has been hammered since the scandal broke, although shared surged with Woodford’s return to Japan and the three resignations.
The scandal broke in October with Michael Woodford—then the company’s newly-installed CEO (and the first non-Japanese in the role) questioned some $687 million paid to a firm in the Cayman Islands following the $2.2 billion acquisition of medical gear maker Gyrus. Woodford was fired: he fled Japan and went public with his allegations. Olympus initially denied the claims, but then admitted it had been using mergers and acquisitions to cover losses—and the pattern went back to the 1990s. Several high-level executives resigned over their roles in the coverup, and the company appointed a committee to look into questionable transactions in an effort to restate the company’s finances and retain their Tokyo Stock Exchange listing.
So far, initial reports from the committee indicate as much as $4.9 billion might be involved. So far no evidence has been disclosed of any links to organized crime, but it’s worth noting Woodford was escorted to meetings with investigators in Tokyo by armed police.