Fujifilm Holdings is having a particularly litigious run with senior Australian and New Zealand executives this year: Dave Marshall, the long-serving leader of the photographic division brought action against the company for unfair dismissal in the same week in September that subsidiary Fuji Xerox (FX) launched legal action in the New Zealand High Court over a $450 million accounting scandal, in which both FX NZ and FX Australia were implicated.
Another executive has also brought legal action against Fuji Xerox for unfair dismissal. Then just last week the NZ Serious Fraud Office (SFO) opened a new investigation into the FX NZ shenanigans, while the New Zealand government suspended the company’s all-of-government printing services contract and cancelled its office supplies deal.
(While in Australia, where the scandal has barely raised a ripple in the general media, Fuji Xerox scored the print contract for the Same Sex Marriage postal survey! Go figure, as they say in the US.)
The fall-out from the scandal has also seen several Fuji Xerox executives in Tokyo either resigning (including the chairman and deputy president) or taking cuts in salary, while announcement of Fujifilm Holdings financial results were postponed to factor in the impact of the false figures from Australia and New Zealand.
Fuji Xerox did not identify those named in the NZ court action nor how many were involved, although Neil Whittaker, former MD of Fuji Xerox NZ and later Australia was named in the NZ Parliament as someone who left the company at the same time as a ‘Mr A’ – named as one of the prime movers.
Mr Whittaker left the company in May last year with a $1 million settlement from Fuji Xerox Australia even after the discovery of widespread accounting irregularities. His replacement at FX NZ, Gavin Pollard, left the company in August and has since launched a legal challenge to win back his job, claiming he’s been made a scapegoat, and contrasting his treatment to Mr Whittaker’s $1 million ‘golden parachute’.
The investigation by Fuji Xerox parent Fujifilm Holdings earlier this year identified a ‘sales at any cost’ culture at the Australasian subsidiaries. A rewards system of extraordinarily generous bonuses and commissions was at the heart of the problem.
According to a report by Australian printing website Print 21, based on the investigation, FX NZ paid $NZ1,500,000 or more each to 27 staff members during the period from January 1, 2011 until March 31, 2017. The total amount of commissions and bonuses accounted for more than half of the overall remuneration received by these employees. Sales staff also scored trips to Hawaii, New York, and elsewhere as an added incentive. Neil Whittaker’s son, Lane Whittaker, general manager, information technology services, was a major recipient of bonuses.
‘Fuji Xerox is committed to resolving these past issues and ensuring they do not happen again,’ said Fuji Xerox Asia Pacific chief executive Isamu Sekine in a press statement. ‘Customers can be confident that Fuji Xerox New Zealand is committed to running its business in a principled way and will continue to lead the market in the delivery of print, document management and business optimisation solutions.’
Earlier this month, Fuji Xerox appointed Japanese-based corporate vice-president Hirokazu Komaki to the newly created role of chairman of the board at FXA in a bid to tighten control of the local operation.
Last week, New Zealand extended its temporary ban on Fuji Xerox NZ from accepting any new government work for another six weeks.
The NZ government spent $55m with the company between 2012 and 2016.