Shares of Japanese optics giant Olympus Corp. dropped significantly on Monday following the announcement that CEO Stefan Kaufmann had resigned due to a drug-related accusation. Data from LSEG showed that the company’s stock fell by 5.3% on the Tokyo Stock Exchange in response to the news. Despite the drop, Olympus shares have seen a strong 31.9% rise so far this year, surpassing Japan’s Nikkei 225 index, which has increased by 13.3%.
Olympus stated in a formal notice that it had received a report alleging Kaufmann’s involvement in purchasing illegal drugs. In coordination with external legal advisors, the company conducted an investigation, reported its findings to the authorities, and cooperated fully with their inquiries.
Following the investigation, Olympus’ Board of Directors concluded unanimously that Kaufmann’s actions likely conflicted with the company’s global code of conduct, core values, and corporate culture. Olympus indicated that Kaufmann, a 20-year veteran of the company, complied with the board’s request for his resignation. He had assumed the CEO position last April, tasked with advancing the firm’s medical equipment division after former CEO Yasuo Takeuchi moved to an executive chairman role.
In light of Kaufmann’s departure, Takeuchi will temporarily reassume his CEO responsibilities as Olympus searches for a permanent successor.
This incident is the latest in a series of controversies for Olympus. In 2011, the company was involved in a significant scandal after it admitted to using fraudulent accounting to mask investment losses over several decades—a situation brought to light by then-CEO Michael Woodford, a whistleblower who exposed the malpractice, resulting in guilty pleas from several former executives.
Japan’s stringent drug laws have created difficulties for foreign executives in the past. In 2015, an American executive at Toyota Motor Corp. resigned after her arrest on suspicion of importing the painkiller oxycodone, though she was later released without charges.
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