Kansai Electric: President and four executives resign over bribery scandal

Kansai Electric Power Co. president, executive vice president and three CEOs resigned on 9 in October amid growing criticism of the bribes, which they say are “lucrative gifts,” which they and other bigwigs received from a former employee. of the city.

Makoto Yagi conveyed his intention to step down as president at a special board meeting held by the dealership to discuss the scandal.

Just a week earlier, on October's 2, Yagi told a news conference that he would remain president of Kansai Electric and vice president of the Kansai Economic Federation. Now, he must also leave the local business lobby.

Executive Vice President Ikuo Morinaka resigned from the board, as did the three executive directors: Nozomu Ushiro, Shigeki Otsuka and Satoshi Suzuki.

They were among the 20 executives at Kansai Electric who received cash and other gifts totaling 320 million yen between 2006 and 2017 from Eiji Moriyama, former deputy mayor of Takahama City, Fukui Province, where Kansai Electric operates a nuclear power plant.

Moriyama died in March at 90 years.

Since then, more details on doubtful payments have been reported, including possible bribes and contracts awarded to a Moriyama-related company.

The central government and the Osaka city government, the largest shareholder of the Osaka dealership, increased pressure on the company for responses.

Another gift recipient was Shigeki Iwane, president of Kansai Electric. He is expected to resign as chairman of the Federation of Japan Electric Power Companies (FEPC), which comprises 10 regional utilities, by the end of the year. He holds the top position of FEPC for only about three months.

Iwane is expected to decide whether to remain chairman of Kansai Electric when a planned third-party panel releases the findings of its investigation into the scandal by the end of this year.

A report compiled last fall by an internal committee said Yagi, who previously served as manager of the company's Nuclear Energy Division, received about 8,59 million yen, including gold coins, from Moriyama.

Yagi returned most of the gifts but used certificates worth 1 million yen to buy a tailored suit, the committee said.

Morinaka, current manager of the Nuclear Energy Division, received about 40 million yen from Moriyama.

Iwane received, but later returned 10 gold coins totaling 1,5 million yen, according to the internal report.

News of Yagi's resignation was welcomed, but Osaka City, Fukui Prefecture, where the utility operates several nuclear power plants, and the Ministry of Economy, Trade and Industry said more needs to be done to get to the bottom. scandal and improve the situation. corporate governance.

"If the company wants to ignore the fiasco just by leaving the president, it will not be able to reform its corporate culture," Osaka Mayor Ichiro Matsui said in 9 in October. “The measures must be exhausted to carry out a complete review. “

Fukui Governor Tatsuji Sugimoto said Yagi's resignation indicates that Kansai Electric is determined to repair its governance and improve compliance.

"The important thing is to find facts and compile measures to prevent recurrence and explain them to the people of Fukui province," Sugimoto told a news conference on the same day.

Industry Minister Isshu Sugawara said the ministry "will respond to Kansai Electric based on the results of a thorough panel investigation."

Third-party panel members will be all outsiders, including legal experts.

The ministry of industry is calling for a thorough investigation to draw up a broader network about the donation period and the authorities to be interviewed.

Although the Osaka city government has asked the board to accept its recommendations for panelists, Kansai Electric should reject the request, citing questions about impartiality.

When Moriyama's gifts were received, Kansai Electric executives often provided information, such as rough estimates of engineering project budgets before the utility placed orders.

At that time, Moriyama served as a consultant to Yoshida Kaihatsu, a civil engineering company.

An investigation by the Kanazawa Regional Tax Department showed that Takahama-based Yoshida Kaihatsu provided dubious funds of about 300 million yen to Moriyama.

Yagi was promoted to president of Kansai Electric at 2010 after serving as head of the Nuclear Power Division.

He replaced the chairman of Tokyo Electric Power Co. as chairman of FEPC and oversaw the nuclear industry's response to the triple collapse of 2011 at TEPCO's Fukushima No. 1 nuclear power plant.

In June of 2016, Yagi became president of Kansai Electric, while Iwane was promoted to executive vice president.

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