Nidec Faces Crisis: Accounting Scandals Shake Investor Confidence

Nidec, a leading Japanese electric motor manufacturer, witnessed a record 22% plunge in share value on Thursday. This follows the company's decision to initiate an independent probe into potential managerial involvement in improper accounting. The latest financial scandal exacerbates ongoing worries concerning governance at Nidec, helmed by its 81-year-old founder, Shigenobu Nagamori.

On Thursday, Nidec's share price plummeted by 700 yen, closing at 2,420 yen, marking its largest one-day decline ever. The company's stock has decreased by approximately 15% this year, starkly contrasting the 10% increase of the broader Topix index. The move comes after internal investigations revealed suspected improper accounting at a Chinese unit, prompting the establishment of a third-party committee.

The probes suggest involvement by Nidec's management or affiliated companies, raising alarm among investors. The company has been attempting to diversify beyond the automotive motor sector amid stiff competition in China's EV market. As the third-party committee's investigation unfolds, Nidec faces intensified scrutiny over internal controls and governance practices.

(With inputs from agencies.)