Market News
Apr. 30, 2026 TSE Imposition of Listing Agreement Violation Penalty: NIDEC CORPORATION
TSE has imposed a listing agreement violation penalty as follows.
* This decision is based on the results of the examination by Japan Exchange Regulation.
| １．Issue Name | NIDEC CORPORATION stock (Code:6594, Market Segment: Prime Market) |
| ２．Listing Agreement Violation Penalty Total |
JPY 91.2 million |
| Reason (Related Clause) |
Due to falling under a case where TSE deems that the listed company has violated the provisions of the matters to be observed in the Code of Corporate Conduct (Development of System and Structure Necessary to Ensure Appropriateness of Business) and has undermined the confidence of shareholders and investors in the TSE market (Securities Listing Regulations, Rule 509, Paragraph 1, Item (2)) |
| ３．Details of Reason | NIDEC CORPORATION (hereinafter referred to as “the Company”) disclosed on Apr. 17, 2026 “Announcement Regarding Receipt of the Third-Party Committee’s Investigation Report (Final Report) and Our Company’s Response.” The Final Report was prepared by a third-party committee independent of the Company and summarizes the results of its investigation into suspected inappropriate accounting practices at the Company and its group companies, including the arbitrary adjustment of the timing for writing down the value of certain assets [of questionable value]. As a result of the investigation, it was determined that numerous inappropriate accounting practices had been committed at multiple locations within the Company’s group, primarily due to excessive performance pressure. It was further revealed that the cumulative negative impact on the Company’s consolidated net assets as of the end of the first quarter of the fiscal year ending Mar. 2026 amounted to JPY 160.7 billion, based solely on the amounts calculated by the third-party committee. The following matters were identified as the principal factors underlying these issues: - Within the group, unrealistic performance targets were set by the Company’s former Representative Director, who exercised control over human resource decisions. In pursuit of achieving those targets, strong pressure was exerted through the Company’s senior management on executives of business divisions and group companies. As a consequence, a corporate culture developed that prioritized short-term profits above all else and did not tolerate failure to meet targets, and compliance was not sufficiently emphasized. - Information regarding inappropriate accounting cases provided to the Company’s Audit and Supervisory Committee did not sufficiently convey the essential nature of the issues faced by the Company. In addition, information sharing among the three lines of audit (i.e., internal audits, Audit & Supervisory Committee audits, and accounting audits) was inadequate, and the Audit and Supervisory Committee did not function effectively. - The Company’s checks and balances functions were impaired. For example, the Chief Financial Officer and the accounting division were directly involved in inappropriate accounting. Moreover, although the internal audit department and the department responsible for handling internal whistleblowing were aware that excessive performance pressure originating from the former Representative Director constituted a root cause of the repeated occurrence of inappropriate accounting within the Company group, they deliberately avoided addressing this issue. - The Company group expanded its business through numerous mergers and acquisitions both domestically and internationally. However, the management structures of group companies were fragile, as post-acquisition management systems were not unified. - Officers and employees of the Company group responded dishonestly to the accounting auditors, for example by providing inaccurate information in an effort to elicit favorable opinions. Furthermore, they failed to recognize that, even if a favorable view was obtained from the auditors, responsibility for explaining the financial results ultimately rested with the Company itself. Taking all of the above circumstances comprehensively into consideration, despite the high level of internal management systems expected of a company listed on the Prime Market, compliance was not sufficiently emphasized due to excessive performance pressure imposed by the Company’s top management. Furthermore, dysfunctions arose in the checks and balances functions of the Audit and Supervisory Committee, the accounting division, the internal audit division, and other related departments. As a result, extremely serious deficiencies in the internal management system persisted over a long period, and numerous inappropriate accounting practices were conducted across a wide range of the Company group’s locations. In light of the above, TSE has deemed that this case has undermined the confidence of shareholders and investors in TSE’s markets. Therefore, TSE will impose a listing agreement violation penalty on the Company. The Company’s stock has been designated as a Security on Special Alert since Oct. 28, 2025. |
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