Why I exposed biggest corporate scandal in years

Olympus whistleblower Michael Woodford at the Rose Bowl at Leeds Metropolitan University.
Olympus whistleblower Michael Woodford at the Rose Bowl at Leeds Metropolitan University.
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BAD things happen because good people turn away, according to the businessman who exposed one of the biggest corporate scandals of recent years.

Michael Woodford was fired from his job as chief executive of Olympus Corporation for questioning accounting transactions later found to have been used to hide huge losses.

The Japanese multinational eventually admitted that it concealed investment losses and restated five years of financial results.

Mr Woodford recounted his “bizarre but true” tale to an audience at Leeds Metropolitan University on Tuesday evening and spoke to the Yorkshire Post about the impact that the experience had on his life.

The story has the ingredients of an airport thriller: $1.7bn accounting fraud, corporate boardroom battles and suggested involvement of the Yakuza. It led to multiple arrests, criminal as well as civil actions and a £10m pay-off for Mr Woodford in an out-of-court settlement.

With his best-selling memoir Exposure now set for film treatment with actor Colin Firth linked to the starring role, Mr Woodford is touring the world to share the events of 2011 and 2012 with as wide an audience as possible to ensure that lessons are learned from those difficult months of 2011 and 2012.

While he is keen to see reforms to make it easier for the next person who needs to blow the whistle, he is also aware that some things – like human nature – are harder to change.

Speaking before his lecture in Leeds, Mr Woodford said he wasn’t disturbed so much by the bad guys, the people who were arrested and charged and prosecuted in Japan, but more so by the behaviour of long-standing colleagues, some of whom he had known for 30 years and had become family friends.

They had helped him expose the scandal, but within an hour of his being fired they deserted him, in spite of the overwhelming evidence.

“With the exception of one person they just moved away,” he said. “I’m sorry to be jaundiced or cynical, but it taught me that most people care for themselves and their nuclear families and to hell with everyone else.

“If you’re a businessman and you are concerned about risk, you have to understand what human nature is like.

“The number of people who will outwardly go out and do bad things is relatively small. But the large majority of people are silent and just let these things happen. That’s a lesson I’ve learned.”

Asked about the personal cost of standing up for something he believed in, Mr Woodford said: “I’m one of those people who was fortunate enough that it had a happy ending.

“In saying that, my wife nearly had a nervous breakdown. She was petrified, she was scared. There were reports of Yakuza.

“Olympus were saying they were going to consider suing me for release of documents.

“My wife, a nice Spanish girl, a schoolteacher, middle class, suddenly finds herself in this John Grisham-like nightmare.

“Her instincts were to make it go away, to shut the hatches, where I was saying that won’t give us safety or security, we have to get this story out. There are scars which will always be there.”

He is passionate about making it easier for people to come forward to expose wrongdoing, especially those in low and middle-ranking positions in the public and private sector, such as a junior management accountant with three children and a big mortgage or a care worker in a residential home.

He was a member of the Whistleblowing Commission, which in November called on the Government to issue a code of practice to be adopted in all UK workplaces.

“From my perspective, the recent scandals and tragedies which have unfolded across a range of sectors, and have so appalled the public, revealed a dangerous culture of silence,” he said.

Mr Woodford wants to see a non-executive director on every board given responsibility for investigating allegations of wrongdoing.

He gave some insight into his background and personality. Mr Woodford grew up in Liverpool and spent 30 years at Olympus, initially at KeyMed, its UK subsidiary, and was a Leeds-based sales manager at KeyMed, selling endoscopy instruments to hospitals across the North.

He rose through the ranks and in October 2011 was appointed CEO at Olympus Corp, the first non-Japanese person to head the iconic Nikkei-listed healthcare and consumer electronics giant.

“I’m one of those dreaded breeds who love to be very controlling with regard to the detail,” he said. “If I get my teeth into something I won’t let go.”

Mr Woodford said he has turned down the presidency of a Japanese healthcare firm and UK media business since his departure from Olympus.

“I don’t want to sit in a room watching Powerpoint slides, talking about leveraging the brand,” he explained.

“I just want to do things of value. I want to a lone wolf. I never want to be in that grouping again of a corporate.”