The CEO and Chairman of Kobe Steel, Hiroya Kawasaki, has resigned in the face of a massive, decades-long scandal that has led to multiple criminal investigations and lawsuits.

Various organizations and daughter companies within the Kobe Steel corporate family were found to have intentionally falsified inspection and test data on aluminum and other metals later sold for use in the aerospace industry. According to Reuters, “Kobe Steel admitted … its data fraud has been going on nearly five decades and also revealed new cases of cheating, highlighting the challenges facing the 112-year-old company mired in compliance failures and malfeasance.” The malpractice was reported by Kobe to have gone on for more than 50 years.

Despite this, multiple Kobe companies held ISO 9001 and/or AS9100 quality certifications, issued by accredited registrars traceable to the International Accreditation Forum (IAF) and the International Aerospace Quality Group (IAQG). Under such certifications, falsified inspection records should have been detected, but somehow escaped scrutiny despite years of certification and dozens of auditors claiming to have examined official records. The companies involved included Kobelco & Materials Copper Tube plants in Thailand and Malaysia, Shinko Aluminum Wire and Shinko Metal Products, Jiangyin Sugita Fasten Spring Wire, and Nippon Koshuha Steel. The registrars who issued related certificates include Lloyds Register Quality Assurance (LRQA) and Bureau Veritas, as well as others still being identified.

Consistently, ISO-related quality standards are found to have been issued to companies later investigated for quality-related scandals or crimes, and often with their registrars allowing the companies to continue to hold the certifications even after the problems are reported.

Oxebridge argues this is due to lax oversight by the IAF and its member Accreditation Bodies, including ANAB and UKAS, and is pressing for reform in the industry to ensure that nonconforming companies do not receive such certifications, and if they do, they are withdrawn immediately upon notification of the scandals. Oxebridge is urging US government officials in the Justice Department, FAA, National Transportation Safety Board and US Department of Defense to include ISO and AS auditors in their resulting investigations, since such auditors have unprecedented access to all levels of a company’s staff, inspection records, engineering data and manufacturing process performance data.

The registrars, auditors and accreditation bodies have pushed back on this effort, claiming that while they issue certificates which declare a company to be in conformance with a given standard, such certificates are not to be taken literally and are only a “snapshot” of the company as it appeared on the days of a given audit.

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