As the removal of the Nagamori influence advances, Nidec faces the risk of delisting. New President Ebisuda (戎田) has announced a policy of dismantling and reorganizing the group’s 353 companies.
Nidec’s president changed suddenly amid speculation that the company could be delisted over an accounting-fraud issue. The president was reportedly effectively forced out just before the postponed filing deadline for the annual securities report was set as 30 September. Issues have also been identified in coordination between the outside directors and the audit firm, and the situation is becoming increasingly confused.
The representative executive officer of PwC Japan attended the press conference, an unusual response. It is not customary for an audit firm to attend a press conference, conveying externally the uncertainty surrounding the application and enforcement of the rules. The company’s corporate management and audit department, audit and supervisory committee, and audit firm had held regular meetings to share issues with the aim of improving the effectiveness of internal controls, but the latest incident is viewed as having exposed weaknesses in their coordination.
The focus going forward will be the policy of dismantling and reorganizing the group’s 353 companies and the feasibility of executing it. Investors and other stakeholders are watching how the reorganization will proceed and what kind of organization will emerge, amid the change in president and the opaque state of internal controls.