Michael Woodford statement on why he quit Olympus fight

Of course the major reason for the continuing uncertainty is that despite my having done the right thing, none of the major Japanese institutional shareholders have offered one word of support to me and conversely have in effect allowed the tainted and contaminated board to continue in office. The fact that such a situation can exist despite the explicit findings of the third-party committee is depressing and totally disorientating to those looking in on Japan from the outside. The cross-shareholding system in Japan, while clearly serving the country well in the years following the Second World War, is in today’s world harmful due to the unwritten convention that one must never publicly criticise another. Such a compliant approach removes one of the essential safeguards in relation to governance and also allows the boards of companies which are underperforming to remain in office. I hope this reality will be seriously debated in relation to legislative changes which would strengthen the country’s corporate governance and in turn the vibrancy of the Japanese economy. I believe this issue of the weaknesses created by the cross-shareholding system is the most important single factor Japan needs to address to be successful in confronting the obvious challenges it faces, in this ever more competitive world.

In this context, throughout recent months it has been important to me not to allow the Olympus situation to be framed as a Japan vs. non-Japan issue, but to emphasise this has been a debate of importance between the reformers and the non-reformers within the country. I believe much good has come out of the on-going scrutiny by the regulatory and law-enforcement agencies in and outside of Japan and the domestic and international spotlight of publicity that the Olympus scandal has attracted. This has allowed a focus on the culture of ‘Yes-men’ and total absence of effective corporate governance that created the organisational and cultural weaknesses of Olympus, with the result that the fraudulent acts continued to occur for so long. With this background the remaining existing directors should surely never be allowed to influence the constitution of the next board and as the third-party committee recommended they should all resign, as each of them spectacularly failed to act to the most explicit warnings of concern of wrongdoing, detailed in my six letters to them and also the condemning PricewaterhouseCoopers report. If this transpires not to be the case, then the world will make its own judgement.

In assembling a slate of director candidates, I’ve been humbled by the individuals of impressive stature who have offered to stand alongside me as alternative directors. I hope each of you can understand that even if we had been successful in winning a proxy fight, it would have created a dichotomy between the institutional shareholders in Japan and those outside of the country and this would have been damaging and the wrong basis on which to move forward.

I would like to take this opportunity to thank those who have inspired and supported me. Firstly Waku (Brian) Miller and Koji Miyata?these two extraordinary individuals stood with me to challenge what was so clearly wrong and they’ve gained nothing for their tireless efforts. Their only motivation was to ensure the truth came out and that Olympus had the leadership it deserves for the future. In this time of globalisation, you had a Japanese, an American and an Englishman standing shoulder by shoulder, wanting the very best for Olympus and Japan. Can I also express my sincere appreciation to the members of my legal team. I have met many lawyers during my career but I’ve never encountered more caring individuals, who at all times have provided me with the wisest of advice and genuinely care about the issues involved.

Most of all I would like to thank from the bottom of my heart, my colleagues at Olympus from around the world, who have encouraged me throughout but especially those in Japan and I will never forget the Nico Nico broadcast on the evening of 14 December and your hundreds of messages of support. I feel a deep sense of sadness that I’ve not been able to fulfil your expectations but I have given everything of myself in trying to do so. Olympus has been a huge part of my life for the last thirty years and it will always remain an essential part of me.

Lastly and most importantly may I thank the people of Japan. When I’ve walked in the streets or eaten at restaurants, so many individuals have come up to me to tell me that what I was doing was the right thing. While I’ve always loved your country, my affections have only been enhanced by the numerous acts of kindness and human warmth which has been extended to me during these difficult weeks.

Japan is a truly great nation and I will continue to come back frequently to enjoy all it has to offer and of course to see my friends.’