Olympus board sacks British company president and CEO

Unanimous vote ousts Michael C.Woodford

In what was seen as a positive and radical move just over six months ago, Olympus Corp. promoted Michael Woodford to the position of company President. Just over two weeks ago the company add the role of CEO to Woodford's responsibilities citing: "It has been six months since Mr. Woodford was appointed as President of Olympus Corporation, and in that time, the Board have been extremely pleased with the progress made under Mr. Woodford's leadership in this role, which has exceeded the expectations at the time of his appointment."

But today Woodford is without a job as the Olympus board unanimously sacked him. This sharp change in atmosphere has dented the Olympus share price and opened up a new debate about western management style in a Japanese company. Western management rejuvenation of large Japanese companies is nothing new. Carlos Ghosn of Nissan and Sir Howard Stringer of Sony are highly successful examples of western bosses who have turned around Japanese companies. It all seemed that Olympus was keen to profit from these examples when it made Woodford president. And they didn't need to find an outsider as Woodford has worked for Olympus for 30 years and was promoted from his position as European boss of the Olympus medical imaging business.

Financial commentators are looking dimly at Woodford's sacking, suggesting that the company should have been better prepared for the consequences of Woodford's appointment. Olympus' management took exception to Woodford's style and execution, which they felt ran a coach and horses through traditional management structures within the company. Woodford suggests that there was sensitivity to his investigation into potentially dodgy accounting practices. Whatever the actual explanation is, this is bad news for Olympus from a financial perspective.

The story has hit the financial headlines because of the interesting of mix of West versus Japanese styles of corporate governance. Naturally, we at FTU hope that this news does not damage Olympus' position as an innovative camera brand.

A full statement by Olympus Corp. can be found here.

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