Fuji Xerox sends top brass to Australia after $450M accounting scandal
- 08 September, 2017 05:00
Fuji Xerox has appointed its former corporate vice president, Hirokazu Komaki, as chairman of the board for its Australian business, in a bid to increase Japan’s oversight of the local operation in the wake of the company’s “inappropriate” accounting scandal.
Fuji Xerox Australia announced Komaki’s appointment to the newly created role on 1 September – the very same day he officially stepped into the new position.
In the words of Fuji Xerox, the new post is “part of continuing support provided to Fuji Xerox Australia by the Fuji Xerox headquarters in Japan”.
Ultimately, the establishment of the new position and Komaki’s appointment are part of the company’s countermeasures “reflecting the need to strengthen its governance” following an investigation into the accounting scandal in its operations on both sides of the Tasman, which resulted in an estimated $450 million hit to net income over a six-year period.
An Independent Investigation Committee, established by parent company, FUJIFILM Holdings Corporation, after the inappropriate accounting practices were identified at Fuji Xerox Australia and Fuji Xerox New Zealand released an exhaustive report in June, pinpointing some of the root causes of the accounting issues.
According to the report, the bulk of the “inappropriate” accounting practices emerged and were widely used under the leadership of the managing director of Fuji Xerox in Australia and New Zealand at the time, under whose leadership a “sales at any cost” culture grew up.
The report refers to this individual only as “Mr. A”. However, the head of the New Zealand First Party, Winston Peters, subsequently pointed out that Mr. A’s departure from the company, as noted in the report, came at around the same time that former Fuji Xerox Australia and New Zealand managing director, Neil Whittaker, left the company.
According to the report, Mr. A was informed that he was “recommended” to leave the post of Fuji Xerox New Zealand (FXNZ) managing director on 16 May 2016.
As reported by ARN, it emerged on 18 May 2016 that Whittaker had unexpectedly left his role as Fuji Xerox Australia (FXAU) managing director.
The report suggested that the “sales at any cost” mindset that sprang up around Mr. A’s leadership led to some overstatement of sales and earnings, which ultimately contributed to the estimated $450 million shortfall.
Now, almost 18 months later, Komaki has been charged with strengthening governance to solidify Fuji Xerox Australia’s operations as well as to “galvanise” the company’s board meetings.
Komaki, who will be relocating to Australia upon visa approval, will also serve as a “close bridge” between Fuji Xerox Australia and its parent companies.
Together with Sunil Gupta, managing director of Fuji Xerox Australia, Komaki is expected to strengthen Fuji Xerox Australia’s focus on the Australian market, customers, and partners.
“Hirokazu Komaki is an outstanding leader, with a wealth of experience in mainly finance and companywide process innovation,” said Isamu Sekine, president and chief executive officer of Fuji Xerox Asia Pacific, Fuji Xerox Australia’s direct parent company.
“His leadership is essential to drive the company forward under the highest standards of corporate governance,” Sekine said.
Komaki began his career with Fuji Xerox in 1978, and served as chief financial officer of Fuji Xerox Asia Pacific in 1999, General Manager of Corporate Finance in 2000, and appointed in 2007 as corporate vice president of Fuji Xerox headquarters in Japan, responsible for companywide process innovation.
Prior to this new position, he was the president of Fuji Xerox Service Creative, a subsidiary of Fuji Xerox, located in Japan.