Bombing on Corporate Spirits of Japanese Companies

“What in the world happened to the Japanese companies!”

It transpired on August 29, 2002, that Tokyo Electric Power Company (TEPCO), which is almost like a public corporation, covered up the defects of nuclear power plants and filed a false report, shocking the whole Japan. This case is part of a series of shocking disclosures of Japanese corporations’ cover-ups such as Mitsubishi’s cover-up of an auto defect, and Yukiziru Foods and Japan Ham’s reception of government compensation by defrauding the Japanese government.

According to Japanese Ministry of Economy, Trade and Industry (METI), the TEPCO, world largest corporation of its kind, did not knowingly report the defects such as fissures or cracks on the nuclear reactor of the nuclear power plants in Nikata Fracture and Hukushima Fracture.

The TEPCO has reportedly covered up at least 29 defects from late 1980s to early 1990s. Especially, 8 out of 13 reactors found defective this time have not been replaced or repaired.

Two years ago when the METI ordered a probe upon an insider’s reporting, the TEPCO concluded, “No problem is found.” This cover-up by the TEPCO is more shocking.

Upon the investigation this time, it is determined that there is no imminent threat of radiation leakage. Nonetheless, the Ministry said that the TEPCO’s employees involved in the cover-up are punishable for the violation of the law. They should have reported the situations directly related to the safety of nuclear power plants.

TEPCO’s CEO apologized in a press conference held on August 29. But Japanese people from all quarters got outraged, “The TEPCO is a public corporation expected to abide by corporate ethics. Nonetheless, it has covered up facts and the cover-up might have ended in taking citizens’ lives.”

In Japan, moral hazard is found in every corner of the society. In the year of 2000, it was found that Mitsubishi had maintained the double recording in order to cover up its autos’ defects, and as a result, recalled more than one million cars. This year, on the other hand, Yukiziru Food and Japan Ham, taking advantage of the mad cow disease, defrauded the government out of compensations.

In response, major representative bodies of Japanese corporations are trying to beef up ethics through revision of relevant self-regulations. But, the ethics of Japanese corporations are collapsing in the face of the long time depression Japanese economy encounters.

Young-Ee Lee yes202@donga.com