Senior executives at the Tokyo Stock Exchange will get between 10 per cent and 50 per cent of their pay cut for up to six months following a systems failure that shut down stock and convertible bond trading on the bourse for several hours on Nov. 1, the exchange said in a statement.
The outage was the most serious trading systems failure to have hit the exchange, which is Japan’s busiest.
Takuo Tsurushima, president of Tokyo Stock Exchange Inc., will see his pay cut in half for six months, the statement said. Sadao Yoshino, chief financial officer and senior managing director, and Tomio Amano, managing director and executive officer for the exchange with responsibility for the IT system, will both lose 30 per cent of their pay for six months, it said. Five other staff will also face pay cuts.
The exchange has laid blame for the disruption at the feet of system provider Fujitsu Ltd.
During upgrade work on the trading system in October, a bug was found in an existing program and this was corrected with new software. However, due to incorrect instructions from Fujitsu the software wasn’t applied properly. This didn’t reveal itself until the morning of Nov. 1 when the stock and convertible bond trading system crashed while it was being started. The bug hadn’t appeared earlier because it was connected with a monthly data compression run that occurred on Oct. 31 after trading had finished.
Trading that day didn’t start until 1:30 p.m. local time (0430 GMT), which is four and a half hours later than normal and one and a half hours before the end of the session.
For its part, Fujitsu said it will soon make a decision on whether any of its staff will face disciplinary or punitive action.
“We again express our sincere regret for the inconvenience to many parties resulting from this incident,” the company said in a statement attributed to its president, Hiroaki Kurokawa, on Thursday.
“In light of the impact to the confidence placed by society in the important large-scale infrastructure system, Fujitsu, at the next meeting of its board of directors, will also consider reducing the compensation of its senior executives concerned, including myself,” the statement said.
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