The Olympus scandal – the dark side of social networks and corporate culture
Critical Perspectives on International Business
ISSN: 1742-2043
Article publication date: 5 March 2024
Abstract
Purpose
This study aims to build on the well-documented case of the Olympus scandal to dissect how social networks and corporate culture enabled corporate elites to commit fraud across multiple generations of leaders.
Design/methodology/approach
A flexible pattern matching approach was used to identify matches and mismatches between behavioural theory in corporate governance and the patterns observed in data from diverse sources.
Findings
The study applies the behavioural theory of corporate governance from different perspectives. Social networks and relationships were essential for the execution of the fraud and keeping it secret. The group of corporate elites actively created opportunities for committing misappropriation. This research presents individuals committing embezzlement because the opportunity already exists, and they can enrich themselves. The group of insiders who committed the fraud elaborated the rationalizations to others and asked outside associates to help rationalise the activities, while usually individuals provide rationalizations to themselves only.
Practical implications
The social processes among actors described in this case can inform the design of mechanisms to detect these behaviours in similar contexts.
Originality/value
This study provides both perspectives on the fraud scandal: the one of the whistle-blowers, and the opposing side of the transgressors and their associates. The extant case studies on Olympus presented the timeframe of the scandal right after the exposure. The current study dissects the events during the fraud execution and presents the case in a neutral or a negative light.
Keywords
Acknowledgements
The author would like to thank the Editor-in-Chief Professor Rudolf Sinkovics, and the Editors Dr Noemi Sinkovics and Professor Florian Becker-Ritterspach and three anonymous reviewers for their constant guidance and support. The author would also like to thank Hyoe Yamamoto, the director of the documentary film Samurai and Idiots (2015), who provided access to his film six months before showing it in cinemas. Initial version of this paper was presented at the International Corporate Governance Society (ICGS) conference, 13–14 October 2018, Shanghai, China. The author would like to thank the three anonymous reviewers and the audience during the session for their comments and advice. Special thanks to Professor Ruth Aguilera and Professor Anthea Zhang, who were mentors during the Doctoral Consortium, also part of the same conference, for their insightful comments and advice for improving this paper. In addition, the author would like to express her gratitude to Professor Stelios Zyglidopoulos and Professor Till Talaulicar for their guidance and advice, her PhD supervisor Professor Jin-ichiro Yamada, deputy supervisors Professor Norihisa Yoshimura and Professor Shinichi Ishii and all seminar students.
Initial version of this paper has been presented at the International Corporate Governance Society conference, 13–14 October 2018, Shanghai, China. The author would like to thank to the three anonymous reviewers and the audience during the session for their comments and advice. Special thanks to Professor Ruth Aguilera and Professor Anthea Zhang, who were mentors during the Doctoral Consortium, also part of the same conference, for their insightful comments and advice for improving this paper. Additionally the author would like to express her gratitude to Professor Stelios Zyglidopoulos and Professor Till Talaulicar for their guidance and advice. Also to my PhD advisor Professor Jin-ichiro Yamada and my deputy-advisors Professor Norihisa Yoshimura and Professor Shinichi Ishii and all seminar students. Last but not least to the Editor-in-Chief Professor Rudolf Sinkovics and the Editor Professor Florian Becker-Ritterspach, and three anonymous reviewers for their comments and guidance.
Citation
Ilieva, M. (2024), "The Olympus scandal – the dark side of social networks and corporate culture", Critical Perspectives on International Business, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/cpoib-09-2020-0126
Publisher
:Emerald Publishing Limited
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