Japanese Kobe Steel blames fake data scandal on corporate culture

Kobe Steel has sought to blame at least a decade of data manufacturing at multiple production facilities on a closed corporate culture, excessive profit-seeking, and “lopsided” factory management.

The company’s explanation for the scandal, which affected more than 500 of its customers in Japan and abroad, came from a series of promises of improved internal controls and better automation of the process. quality test. They include the establishment of an internal committee that will oversee “quality governance”.

Although the data tampering issue has not yet been linked to any reports of security issues, in a statement, Kobe apologized for “the enormous amount of trouble we have caused our customers, suppliers. , shareholders and many others “.

The apology came with the results of an internal investigation into the history and extent of an issue primarily involving Kobe selling aluminum, copper and steel products where product specifications had been tampered with so that they appeared to meet to customer requests. The report was commissioned by the Japanese government.

The resultant mea culpa – a 27-page document and presented to Japan’s Commerce Ministry on Friday – emerged a month after the data tampering scandal erupted around the country’s third-largest steelmaker and dealt another blow to Japan’s wider reputation Inc as a model. of quality control.

Although the report details a number of specific issues, analysts said its explanations bear a “striking resemblance” to reports that other Japanese companies have produced following their own scandals. The report stated that the Kobe forgery was carried out “in a harsh management environment,” in which departments were required to meet demanding profit targets: language very similar to that used when Toshiba attempted to explain seven years of fraudulent accounting.

When Kobe, long regarded as a symbol of Japanese-made quality, first revealed the details of its scandal in October, its chairman, Hiroya Kawasaki, said at the time that confidence in the company was ” fallen to zero ”. Pressed to step down on Friday, Kawasaki said a decision on how senior management would take responsibility for the scandal would be made after the results of an ongoing external investigation.

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