Kobe Steel, Nissan, etc are just tip of the iceberg

“Deeply sorry.” “Deeply sorry.” The bowed heads, the scripted apologies. Kobe Steel, Nissan, Subaru. “The tip of the iceberg,” says Spa! (Nov 7-14). It quotes risk management consultant Yoshihiro Nishino: “Scale and details aside, it’s my impression that just about every company is up to some illegitimate activity.”

The recent string of scandals, one following hard on another, has deeply shaken Japan’s manufacturing sector.

Nissan, Japan’s second-largest automaker, got the spectacle rolling in September, admitting vehicle inspections had been conducted by unauthorized employees.

Next up: Kobe Steel, Japan’s third-largest steelmaker, disclosing in October that for 10 years at least it had been falsifying inspection data.

Finally (for now): Subaru, acknowledging in late October abuses similar to Nissan’s.

Spa! takes us back a few years to show this is nothing new, reminding us of Mitsubishi Motors’ fuel mileage scandal in 2016, Toshiba’s accounting scandal in 2015, and Toyo Tire and Rubber’s falsification, over a 20-year-span culminating in disclosure in 2015, of data pertaining to its earthquake shock absorbers.

Shattered reputations and clouded business prospects aside, Nissan and Subaru are now in the midst of  massive recalls, Nissan’s involving 1.16 million vehicles, Subaru’s 300,000.

Common sense suggests a common thread, which Nishino boils down to one word: “Pressure.” “There is nobody,” he says, “who is not working under pressure.” Corporations are pressured by stockholders to raise dividends, by clients to meet deadlines, by the government to meet standards. Employees are pressured by their bosses, the bosses by their bosses, and so on.

Up to a point, pressure is stimulating. Past that point it’s damaging. Way past that point, it can be devastating. “It’s like a virus,” Nishino says. A small mistake gets made. Corrected immediately, its repercussions would be minor. Covered up, it grows, spreads, mutates, spreads farther. By now too many people are involved, too much is at stake. Painless correction is no longer possible. The instinctive response is coverup – until that too becomes impossible, with the results we are now witnessing.

 An automaker employee, speaking to Spa! on condition of anonymity, reveals something of the prevailing atmosphere. The inspection requirements which Nissan and Subaru flouted are not easy to meet. Inspectors must be highly qualified. They earn high salaries. Their expertise is too narrow for them to be shifted to other work between inspections. When not inspecting, they are idle. Companies naturally want to keep their numbers down. When production is at its peak, those numbers are liable to be insufficient. There’s a choice: put uncertified inspectors to work and hope nobody notices, or get hopelessly bogged down. An additional pressure Spa!’s source mentions, a new factor in the equation, is that to minimize overtime. “But the work has to get done!” he exclaims. So overtime work, too, gets covered up – unreported and largely unpaid.

That too has consequences, the worst being karoshi (death from overwork). A case in point mentioned by Spa! is that of NHK reporter Miwa Sado, who died in 2013 at age 31 of heart failure. The month before her death she’d worked 150 hours overtime. Does NHK’s four-year-long failure to make this public constitute a coverup? Or was it, as the broadcaster claims, a matter of respecting the family’s wish for privacy? Either way, Spa! notes the inescapable irony: NHK was vigorous enough in its coverage of a more notorious karoshi episode – the suicide in 2015 of 24-year-old Matsuri Takahashi, an employee of the advertising giant Dentsu Inc. When the problem is one’s own, privacy has a way of suddenly becomes paramount.

© Japan Today