Advance Create's detailed recurrence-prevention plan, approved by its board on 30 September, states a policy that its president will leave the post of representative director and president even if shareholders re-elect him as a director at the next annual meeting. The Tokyo Stock Exchange had designated the company's shares a special-attention security on 29 September and notified it that a listing contract penalty would be collected. This is a stated policy, not a resignation: the document gives no date for a change in the top job, and it points to the company's 13 August outline for how that decision was reached.
The company's accounting problems are covered in our earlier article on the accounting probe. The new disclosure adds the company's own account of the cause and its dated fixes.
The listing consequence
The company says the TSE designated its shares a special-attention security on 29 September. Advance Create says it plans to draw up an improvement plan on governance and internal controls and submit it to the exchange as an "improvement plan and status report", with the aim of having the designation lifted. It will disclose the submission date once it is set. The disclosure does not give the amount of the penalty.
The company's diagnosis
Advance Create cites a third-party committee finding of improper accounting in some past advertising transactions and software capitalisation at the company and its wholly owned advertising-agency subsidiary, plus involvement of some management. It names the direct cause as excessive performance pressure from the current president, set within a culture built around him and a homogeneous organisation. Outside directors, it says, were not given the information needed to spot warning signs, and internal controls did not work well enough.
The company also says the committee did not judge the president's strong leadership negatively in itself, and that denying his role would deny the company's history. Its founding philosophy and company creed stay.
What has changed, and what is scheduled
The company says it has already removed the president from its nomination, remuneration and governance committee, taken him out of director selection and pay decisions, and begun sharing executives' emailed or chatted instructions with other executives unless there is a particular impediment. Personnel proposals now sit with an executive officer for administration until a director in charge of administration takes office in December 2026. It has also adopted a code of conduct that puts compliance ahead of performance targets and commits it to protect whistleblowers.
From 1 October, it will appoint a new executive officer for administration, described only as a person with experience at a major financial institution and consulting firms. A reform director, chosen from those elected at the December annual meeting, will lead the plan.
| Timing | Step |
|---|---|
| From 1 October 2026 | New executive officer for administration appointed |
| October 2026 | Group discussions and first training; monthly outside director-audit board meetings begin; internal rules including the authority table revised; audit findings register set up |
| By November 2026 | Recurrence-prevention monitoring committee established |
| December 2026 | Annual meeting; reform director chosen from elected directors; director for administration takes office; rule changes written into internal regulations |
| By March 2027 | Whistleblowing system rebuild completed |
| April 2027 | New manager evaluation criteria apply to personnel reviews |
The governance changes include monthly meetings between outside directors and the audit board, quarterly meetings of the auditor, audit board and internal audit office, and a duty for accounting and internal audit staff to report signs of fraud directly to outside directors and auditors. On controls, business units will carry responsibility for proving a transaction is real, and high-risk transactions will need prior review by accounting and legal staff.
The company says it consulted the third-party committee and confirmed the plan fits the committee's recommendations. The document does not name a successor to the president.