After months of investigations, raids, denials, accusations, and admission, the three biggest advertising giants in Japan, Dentsu, Hakuhodo, ADK and two other firms and seven individuals stand indicted over the bid-rigging scandal tainting the 2020 Tokyo Olympics.
On February 18, Dentsu Group president and chief executive Hiroshi Igarashi admitted Dentsu’s involvement and collusion in planning and fixing the pre-Games test events and main competitions at the Tokyo 2020 Olympics and Paralympics. Former ADK Holdings president Shinichi Ueno also admitted to bribery charges to former Tokyo 2020 executive board member Takahashi n court last week.
Charged with violating antitrust and anti-monopoly laws, the Tokyo District Public Prosecutors Office has also filed criminal charges against 56-year-old Yasuo Mori, the former organising committee official, Koji Henmi, former assistant head of the sports department of Dentsu Inc. and five others suspected of illegally awarding bids.
Interestingly, the rigged bids in question were conducted in 2018, Tokyo’s public broadcaster NHK learned that Dentsu’s behind-the-scenes collusion of drawing up lists for awarding unlawful, discretionary bids started a year prior in 2017.
We reported earlier this month, Dentsu, Cerespo and Fuji Creative are already barred from bidding for contracts at Tokyo government’s events for a year.
Road ahead: Dentsu
After a very public blow to their image, for the first time in months, the ad major has issued a statement to Campaign Asia-Pacific citing concrete steps the company will take from now on.
1. Stepping up a 3-member independent special investigative committee effective immediately (Feb 28):“The Special Committee will receive the Investigation and Review Committee’s findings of the facts and causes and recommendations for preventing recurrence and report them to the Dentsu Group Inc.’s Board of Directors,” it reads.
2. Committee composition:
- Chair: Masayuki Ikegami, former Supreme Court justice
- Member: Kenji Kawai, attorney, former chief justice of the Sendai High Court
- Member: Toshihiko Itami, attorney, former superintending prosecutor of the Osaka High Public Prosecutors’ Office
3. Disciplinary action against those involved
Dentsu Inc. says: “The Company takes its responsibility for this matter seriously and has requested that the two Group Executive Management members currently in charge of the Japan region return their compensation.”
Further, there is a promise of tighter governance.
“Additional improvements to governance and operations will be instituted at the company’s domestic subsidiaries in Japan,” says Dentsu Inc.
At the time of filing this story, Campaign did not hear back from Hakuhodo.
