Kansai Electronic Power Acknowledges Two of Its Top Executives Received $929,000 in “Gifts” from Local Official

On October 2, The Mainichi reported that Kansai Electric Power Co.  (KEPCO) disclosed that “two [KEPCO] executives who were responsible for its nuclear business both received more than 100 million yen ($929,000) as gifts from a former official of a town hosting one of its nuclear plants.”  KEPCO stated that 20 KEPCO officials had received ¥318.45 million ($2.98 million) worth of gifts, which “included U.S. dollars, gold coins, and gift coupons for tailored suits.” KEPCO managing executive officer Satoshi Suzuki received the largest amount (¥123.67 million, or $1.16 million) and former deputy president Hideki Toyomatsu the second largest amount (¥110.57 million, or $1.03 million).

According to The Mainichi, KEPCO employees accepted gifts from the late former deputy mayor of the town of Takahama, Eiji Moriyama, from 2006 until Moriyama’s death in 2019.  KEPCO’s nuclear power division – which Toyomatsu headed and Suzuki currently serves as acting chief — is located in Fukui Prefecture, where Takahama is located.

A report that KEPCO released on October 1 stated that Moriyama “had a wide network of connections with Japanese lawmakers and he had threatened to obstruct operation of the company’s nuclear power facilities if it did not comply with his wishes.”  In addition, KEPCO Chairman Makoto Yagi stated that Moriyama’s offering of gifts escalated after “the March 2011 earthquake and tsunami in northeastern Japan, which triggered the Fukushima nuclear crisis.”

An independent panel is to be established to investigate the facts relating to the 20 KEPCO officials and Moriyama.  KEPCO President Shigeki Iwane (who the KEPCO report said had received ¥1.5 million ($14,000) from Moriyama) and Yagi (who received ¥8.59 million ($80,275)) said that “they will decide what to do after looking at a report it compiles by the end of this year.”

KEPCO reportedly imposed a 20 percent reduction in remuneration for two months on Yagi and Toyomatsu, and a 20 percent reduction in remuneration for one month for Iwane.  KEPCO also stated that the officials had returned or repaid most of the gifts, but that ¥34.87 million yen ($325,866) worth of gifts remain unreturned.

N.B.: These revelations relating to the Moriyama “gifts” have attracted substantial attention in Japan — in part because last week KEPCO had held a press conference about the “gifts” but refused to disclose details, “citing the need to protect personal information.”  Even at its October 3 press conference, KEPCO disclosed only 12 of the 20 officials who received “gifts” from Moriyama.

However uncomfortable these revelations are, KEPCO needs to refrain from future piecemeal disclosures, and to expedite the independent panel’s review process.  The day after the October 2 KEPCO press conference, an unnamed former KEPCO senior official in charge of its nuclear business admitted that “he received ‘an outrageous gift’ after meeting Moriyama for the first time in the late 1990s, although he did not divulge what was received.”  That official also said that he returned the gift to Moriyama about six months later, which “enrag[ed]” Moriyama.

That former official’s statements indicate that that the panel needs to expand the scope of its investigation well beyond 2006.  It also needs to report as quickly as possible and comprehensively on the full scope and extent of KEPCO officials’ acceptance of Moriyama’s “gifts.”  The longer that KEPCO officials draw out the process, the more likely that public anger, and calls for top management’s ouster, will intensify.

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