Fuji TV scandal: A lesson in bad culture

Fuji TV scandal: an example of how corporate wrongdoing becomes ten times worse due to shoddy corporate culture

Fuji TV has been in the news this week, and not for good reason. Damning revelations have snowballed into more significant headaches because the company’s culture simply isn’t up to scratch. 

As you may already know, a lousy culture is one of the riskiest and most damaging weaknesses a company can have. 

Fuji TV, one of Japan’s biggest broadcasters, has landed in a crisis entirely of its own making. 

It follows the same script as so many other corporate scandals: somebody does something wrong, alarm bells are sounded, the board end executives act in a way that they’re then accused of underperforming, prompting further investigations which expose a terrible company culture. 

It turned what could have been a manageable crisis into a full-blown corporate disaster.

• According to a report in the Financial Times, former pop-star-turned-TV-host Masahiro Nakai was alleged to have engaged in sexual misconduct with an un-named female employee of Fuji TV. 
• Nakai retired last week, won’t make further comments, but has admitted to having “troubles” with an unnamed woman and to have paid a settlement.  
• Initial efforts to address the scandal faced colossal backlash. Investors criticised the company’s approach as having “serious governance shortcomings.” 
• Now, the chair and head of television are to step down immediately. 
• Shareholders have said that the latest moves haven’t reassured them that the company is tackling the scandal properly.
• The new head of television has said, “Without regaining trust, Fuji Television has no future.”

In the history book of corporate scandals, many are traced to a poor company culture. If it didn’t cause the problem, it made it ten times worse. Poor company culture often means that other issues will fester beneath the surface until people start asking questions; then, they will become public knowledge and a reputational disaster. 

Fuji TV’s problem comes down to culture because of the insulated and traditionalist way its board was put together.

How do we know it was insulated and traditionalist? Because we know that despite the board’s extremely large size (17), only one of the seven supposedly “independent” directors actually met the national criteria for being one. Moreover, the board’s average age was over 70. It’s a recipe for conformist views, groupthink, and a lack of questions or challenges regarding established working methods. 

No board can hope to emerge from a scandal well if its culture suffers from problems like the above. 

No, these problems breed an atmosphere of tolerance towards misconduct because everyone knows everyone else, and reprimands are weak. When a corporate culture does this, it creates an environment where bad behaviour thrives. That’s how companies attract national shame, and Fuji TV is now paying the price.

Have you ever heard the saying “culture eats strategy for breakfast”?

It means that even the best corporate plans, made by the smartest, most driven people, have little chance of success if the culture isn’t right. A company’s culture determines whether leaders make ethical decisions, whether employees feel safe reporting problems, and whether bad behaviour is addressed before it becomes a scandal.

When corporate culture is strong, businesses are resilient. When it’s weak, they crumble at the first sign of trouble. Culture separates a company that can weather a crisis from one that collapses under the weight of its own failures. Fuji TV is a textbook case of what happens when governance and culture fall out of sync.

A truly good culture is all about corporate integrity, even when no one is watching. As multiple scandals have shown, someone will eventually be watching.

The harsh truth is that while corporate culture can be destroyed overnight, it takes years to build. 

Think of the Fuji TV story as a source of contrast. Bad directors will read the story and think, “I’m glad I don’t have problems like that.” Good directors will read the story and wonder, “are there any cultural red flags in my company that need attention.” Maybe there are, maybe there aren’t; the point is to ask the question because it could be a lifesaver in a few years when some scandal breaks. 

Ultimately, the board and executives need to take responsibility for shaping the culture in words and actions. Employees need to see that ethical behaviour is rewarded, and that misconduct has consequences.

Governance structures should support transparency and accountability. Regular culture audits, independent oversight, and clear whistleblowing policies can prevent problems from escalating. Insulated boards, dominated by personal relationships and groupthink, will never foster a culture strong enough to withstand events like the Fuji TV scandal.