When we think of big brands, words such as ‘Quality’, ‘Recognized’, ‘sought after’ and ‘Reputable’ come to mind.

‘Financial Fraud’ however, does not.

As multinational corporations dominate their industries respectively, building up a good, reputable corporate image becomes a key distinction that differentiates them from their competitors. They often choose to engage in charitable events or sustainable practices to both build up their brand image, as well as generate trust and expanding their current customer fan base. They make it a point to engage in such ventures and activities for the purpose of showcasing how aware they are toward their social responsibilities to bridge the gap between them and their shareholders by building a link of trust. But what happens when thatfaçade shatters under the eyes of public scrutiny?

Toshiba has generated heavy stirs in recent news wherein toxic corporate culture has driven an internal problem for another 4 years since it’s inception. Toshiba adopts a bureaucratic leadership, where in communication followed a one-way channel from top to bottom. As such subordinates were given nearly impossible targets to achieve. As such to make up the difference, subordinates engaged in tweaking financial reports, postponing loss reports and moving certain costs into future years in an effort to keep up with targets set by their superiors.

The company was reported of having overstated profits by 151.8 billion yen. In light of the huge scandal, Toshiba’s shares have dropped by nearly 20%. It’s CEO was also found to be guilty of both knowing and condoning such unethical behavior, and resigned.

Trying to repair it’s wounded image, Toshiba has chosen to approach the situation by becoming more transparent to it’s shareholders, releasing it’s reports in an attempt to rekindle some form of trust and minimize the damage incurred to it’s brand image.

Even though Toshiba’s actions are undeniably wrong and unethical, I would not be surprised if I should learn that other conglomerates and corporations have or will also be exposed on similar fronts. With that being said I feel that many businesses engage in such practices, the only difference lying in how severely they engage in it.

bib:

✦”Toshiba Just Lost Its CEO to a Huge Accounting Scandal.” Fortune Toshiba Just Lost Its CEO to a Huge Accounting Scandal Comments. N.p., 21 July 2015. Web. 01 Oct. 2015.

✦Members, Eight Board. “Toshiba CEO Resigns over $1.2 Billion Accounting Scandal.” CNNMoney. Cable News Network, n.d. Web. 01 Oct. 2015.

Picture taken from:

✦http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/electronics/11753462/Toshiba-shares-rally-as-execs-quit-over-1.2bn-accounting-scandal.html