Kobe Steel says three execs aware of data falsification

December 22, 2017

Tokyo- Japan's Kobe Steel Ltd. said Thursday that three executives were aware of company's product quality data manipulation before the malpractice came to light.

It was the first time for Kobe Steel to admit that any executive knew about the data falsification, since it announced in October that data for aluminum, copper and other products, including on strength, were manipulated.

The company decided to extend the period of investigations by an external panel into the wrongdoing until the end of next February. The probes were initially slated to finish by year-end.

The decision was made because voluntary inspections that the company conducted to look into the misconduct have been found to be flawed at 70 pct of the 79 group bases covered by the inspections, according to the firm.

"We'll judge the management responsibility after the report by the external committee is out," Executive Vice President Naoto Umehara told a news conference.

"Chairman and President Hiroya Kawasaki takes (the situation) seriously," Umehara also said.

The three executives are Managing Executive Officers Takumi Fujii and Nobuaki Isono as well as Executive Officer Seiji Hirata.

On Thursday, Kobe Steel relieved the trio in charge of safety management and technology control at the aluminum and copper business of their duties. It plans to punish them after the probes finish.

The three failed to report data manipulation, even though they knew of the irregularities from the time they held such posts as plant managers in the past, according to the firm.

The executives did not directly engage in the wrongdoing or give any instructions to carry out the misconduct, Umehara said.

But a question remains why it took two months before this came to light. Suspicion arises of possible attempts to conceal the matter.

The external panel will further investigate the data manipulation case, such as on motives.

After seeing flaws in voluntary inspection procedures at most group bases, the panel plans to conduct additional investigations there mainly by expanding the scope of targets.

The fresh probes may lead to the discovery of additional substandard products.

Another reason for the extended investigation period is that reports about several matters that "require cautious study" have been received through a whistleblower hotline, Umehara said. The company did not disclose details of the reports. Jiji Press