(Bloomberg) — Fuji Media Holdings Inc. said former Chairman Hisashi Hieda is stepping down from the board, part of the fallout from a sexual harassment scandal that’s frightened off advertisers and pummeled the reputation and bottom line of one of Japan’s biggest broadcasting networks.
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The holding company said it’s slashing the size of its board to 11 members from 17, and making the majority of members outside directors. In total, 10 Fuji Media directors are stepping down, making way for a younger board with more women, the company said in a statement. The average age of the new board in June will be 61.6 years, down from 71.2 years, it said.
The media group, which has been fielding demands from activist investors, said it will also review its asset holdings, including strategic equity, and improve its capital allocation, as well as review its approach to shareholders’ equity. The company has extensive real estate holdings, as well as cross-shareholdings with media companies Toei Animation Co. and Toho Co., along with Dentsu Group Inc., the country’s largest advertising agency.
Shares of Fuji Media are up 40% this year, after touching a near-two-decade high. Its shares closed up 2.1% Thursday prior to the announcement.
Hieda held executive-level positions within Fuji Media for more than 40 years. Some investors have linked the network’s failure to promptly address harassment allegations to the work culture Hieda cultivated within Fuji Television Network Inc. during his years as its chief.
In a letter dated Feb. 3, Rising Sun Management, adviser to Nippon Active Value Fund, called for Hieda’s resignation, saying the 87-year-old held “absolute control and influence” over the boards of both Fuji Media and Fuji TV. NAV and Dalton Investments, which are both managed by James Rosenwald, are together Fuji Media’s third-largest shareholder.
In December, a local tabloid reported that one of the network’s most prominent hosts — former J-pop idol Masahiro Nakai — had sexually harassed a woman who was then employed at the TV station, and that the broadcaster was aware of the June 2023 incident, but had failed to look into the matter.
Public anger at Fuji Media resulted in an exodus of big-name advertisers, including Toyota Motor Corp., Seven & i Holdings Co. and Suntory Holdings Ltd., and forced Fuji Media to slash its earnings outlook. Nakai, who continued to appear as a host on the network, issued a public apology to the victim, with whom he’d reached a settlement, and retired from show business. Fuji TV’s president as well as the chairman of the parent company stepped down.
