Sony Shareholders Not Happy With Record Losses, Despite Recovery Promises
Sony's new CEO received the approval of investors to lead the company Wednesday, but not without a barrage of criticism.
A record number of company shareholders turned out for Sony's annual shareholders meeting at a Tokyo hotel, with many voicing anger at Sony's poor results. CEO Kazuo Hirai listened calmly and promised to turn things around as attendees questioned everything from executive compensation to the reliability of Sony-made products to the chance of the company failing entirely, and even the age of company leadership.
"For an IT business, I feel that the board of directors may be too old," one shareholder said, referring to the fact that majority of Sony's 14 directors were born in the 1940s.
Many told Hirai they didn't understand why former CEO Howard Stringer and President Ryoji Chubachi are being retained as directors after overseeing years of losses and a plunge in the company's stock price. As per company policy, none of the shareholders that spoke gave their names, though those in attendance were largely private Japanese investors, who often bet on Sony's reputation and history.
Hirai, who took over in April from Stringer, is attempting to revive the company as it struggles with its biggest loss ever last fiscal year, a TV business that is deeply in the red, and a lack of the compelling products on which its legacy was built.
He repeated his plan to revive the company's core electronics operations, focusing on digital imaging, games and mobile phones. Sony aims to generate 70 percent of sales and 85 percent of operating profit in its electronics business from those three areas.
"Sony's electronics business is in a very severe operating environment," he said.
The CEO declined to comment when asked about widespread news reports that Sony will soon make a major investment in struggling Olympus, but said Sony is looking at various types of tie-ups in the medical field, one of Olympus' strengths.
Sony aims to return to profitability during the current fiscal year through March, as it undergoes a restructuring that includes cutting 10,000 jobs worldwide, about 6 percent of its total.
The company's shares have fallen sharply in recent years and are down over 20 percent so far in 2012.
Attendance at the shareholders meeting was 9,303, well above the 8,360 that came last year. Sony currently has 714,039 shareholders total.