Lack of diversity caused Toshiba scandal, experts say

Experts reveal what happened within Toshiba to trigger the chain of events that led to one of the biggest corporate scandals of 2015

Lack of diversity caused Toshiba scandal, experts say
A closed corporate culture and a lack of worker diversity have been placed at the heart of the scandal currently surrounding Japanese giant, Toshiba.
A third-party panel, headed by a former Tokyo prosecutor, said that Toshiba’s executive suite had pressured its subordinates into achieving ambitious profit targets. With employees unable to challenge the leadership and bookkeeping driven by a focus on producing the right numbers, the stage was set for one of Japan’s largest corporate scandals.
Corporate cultures like Toshiba’s are fairly common in Japan however, with conformity and lifetime employment being qualities highly-prized by staff at all levels.
Experts say that this needs to change however and that more diversity can help bring about different perspectives and greater transparency within local organisations.
Yamato Sato, professor of management at Keio University, spoke on this issue. “[Japan’s] corporate culture encourages you to take the same action as others, and makes you believe that maintaining the status quo is the right thing to do. It’s really hard to change,” he said.
“When people with different views come to an organisation, they may face resistance at first. But accepting them will also allow the organisation to find and fix what may be wrong with it.”
Mitsuyo Matsubara, visiting professor of economics at Gakushuin University said that promoting internal diversity was inevitable in Japan although this change has been slow in the majority of local firms.
“Japanese companies still emphasise Japaneseness rather than diverse perspectives when it comes to human resources management,” he stated.
Tetsuya Otake, managing director of Toyota, suggested firms look beyond hiring additional foreign nationals. He recommended putting “the right people in the right posts regardless of nationality, gender and age to respect diversity” in order to make an organisation truly global.
A diverse working environment and the ability for staff to offer their opinions will help strengthen corporate governance policies already in place so firms can avoid a Toshiba-like fate in the future.
Related stories:
Three lessons HRDs can learn from the Toshiba scandal
Are fraud and corruption driving candidates away?
Reputational fallout: How to deal with a news leak

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