Suntory CEO Resigns Amid Drug Allegations, Stocks Rise 2.9%

The chief executive officer of Suntory Holdings, a leading beverage giant in Japan, has resigned following an investigation into alleged possession of illegal drugs. The resignation comes as a result of the CEO's decision to take responsibility for the incident.

The company's chairman, who hails from the founding family, confirmed the resignation. However, details regarding the type of illegal drug involved were not disclosed, with the chairman stating that the case is still under investigation.

The 66-year-old CEO is a prominent figure in the business world, known for leading Suntory to significant growth. The company is renowned for producing whiskey, beer, and non-alcoholic beverages. The CEO took on the role in 2014 and has also played a crucial role in industry-government communications, earning widespread respect within the industry.

The chairman praised the CEO, describing him as an energetic and decisive leader who had driven the company's profits and sales to new heights over the past decade. The chairman will now take full responsibility for the company's operations, including its overseas business.

Despite the CEO's significant contributions to the company over the years, the chairman stated that his resignation was inevitable due to governance issues. In Japan, it is customary for individuals to resign if they bring embarrassment to their organization, reflecting a cultural emphasis on taking responsibility and avoiding shame.

The vice chairman echoed this sentiment, stating that regardless of the final verdict, the CEO was no longer suitable for the position. Both the chairman and vice chairman suggested that the alleged drug in question might be a supplement obtained by the CEO. Suntory, founded in 1899, is known for its whiskey and soft drinks, as well as supplements.

According to the CEO, he was unaware that the supplement was an illegal substance. The police investigation began last month, but further details were not provided. The announcement was made after the market closed, and the company's stock price rose by 2.9% on the Tokyo Stock Exchange.

This incident highlights the importance of corporate governance and the potential impact of personal actions on a company's reputation. The resignation of the CEO underscores the seriousness with which Suntory views the allegations and its commitment to maintaining high standards of conduct within the organization.

The company's decision to accept the resignation and the chairman's willingness to take on full responsibility demonstrate a proactive approach to addressing the issue. This move is likely aimed at restoring public trust and ensuring that the company can continue to operate effectively despite the controversy.

As the investigation continues, the focus will be on the outcome and any potential legal consequences for the CEO. The company's ability to navigate this crisis will be closely watched, as it seeks to maintain its position as a leading player in the beverage industry.