Nidec became the world's top motor maker thanks to founder Shigenobu Nagamori's hard-driving culture. Now, that same relentless pressure has erupted into an accounting scandal that threatens to undo his legacy. https://t.co/GMRwUoaKag📷: Akio Kon/Bloomberg https://t.co/aLH2Bw9dsa ...

Nidec became the world's top motor maker thanks to founder Shigenobu Nagamori's hard-driving culture. Now, that same relentless pressure has erupted into an accounting scandal that threatens to undo his legacy https://t.co/8SA1p8HclM ...

Core Viewpoint - Nidec Corp. faces significant challenges following its removal from the Nikkei 225 and Topix indexes due to an ongoing accounting scandal and internal control issues, leading to a sharp decline in its share price by 19% [1][2]. Company Overview - Nidec, a precision motor manufacturer founded by billionaire Shigenobu Nagamori, has been designated as a "security on special alert" by the Tokyo Stock Exchange due to lax internal controls and an investigation into accounting irregularities at a subsidiary [2][3]. - The company will be removed from the Nikkei 225 on November 5 and from the Topix index on November 4, with Ibiden set to replace it in the Nikkei 225 [2]. Investigation and Governance - An independent committee was formed by Nidec to investigate suspected improper accounting practices at a Chinese subsidiary, involving payments of 10 million yuan (approximately $1.4 million) [3]. - The company's auditor, PwC, did not express an opinion in its annual report for the fiscal year ending March 2025 due to insufficient audit evidence and highlighted potential significant impacts on consolidated financial statements from questionable accounting practices [4]. Market Reaction and Future Outlook - Following the announcement, Nidec's share price is expected to remain under pressure, with institutional investors likely to avoid holding the stock until a resolution is reached [6][7]. - Concerns are also raised regarding the future leadership of the company, as the founder, now 81 years old, has already passed the CEO role to Mitsuya Kishida amid succession planning [7].