Corp. founder Shigenobu Nagamori created a corporate culture that led to losses being improperly deferred and improperly reflected in earnings, a board committee report concluded, fueling financial and management turmoil at the electric-motor manufacturer.

As a result, Nagamori as well as past chief executives are potentially liable for civil damages, the company said in the redacted report released on Tuesday, adding that it will consider pursuing legal measures against them after it has restated financial results.

The report, covering events going back roughly a decade, puts much of the blame on the hard-charging founder for creating the environment behind Nidec’s accounting woes. The manufacturer is seeking to regain PwC Japan’s approval and convince the Tokyo Stock Exchange that its internal controls have been repaired. By detailing the failures as systemic rather than isolated, the report suggests restoring credibility will require a broader governance overhaul as Nidec faces delisting risk and activist pressure.

The 251-page document describes how Nagamori, at one point, insisted on achieving a ¥240 billion ($1.5 billion) operating profit target, even if that meant required expenses would not be booked during the appropriate timeframe.

Nidec shares have been trading at their lowest level since 2016 this week, having lost more than a third of their value since late September, when Nidec announced the sudden exit of Mitsuya Kishida as CEO. Newly appointed CEO Michio Kaida is now seeking to restructure loss-making businesses and respond to activist pressure.

Apart from Nagamori, the report on Friday named former CEOs Jun Seki and Kishida, former Chairman Hiroshi Kobe, former President Hiroyuki Yoshimoto and former Senior Vice President Akira Sato. The scope of any damages to be claimed should be determined according to their degree of contribution, according to Nidec.

Nidec has been designated a security on special alert since October 2025 because of the need to improve its internal management system. PwC withheld its opinion on the accounts after saying it was unable to obtain sufficient and appropriate evidence. The company is seeking to obtain the auditor’s signoff and submit a report to the exchange by Oct. 28 as it seeks to avoid a delisting notice.

Oasis Management Co. disclosed last week that its stake in Nidec had risen to 9%, making it the largest disclosed shareholder and placing it ahead of Nagamori’s direct holding. Oasis founder Seth Fischer has urged Nidec’s outside directors to hire financial advisers and seek preliminary, nonbinding proposals as protection against an unintended delisting.

Nagamori, 82, built Nidec through decades of aggressive acquisitions and a high-pressure operating culture, but struggled to hand over control. Yoshimoto and Seki were each tapped as potential successors before leaving, while Nagamori retained influence over the company. He relinquished his last formal title in February but remains one of Nidec’s largest shareholders.

The accounting fallout has devastated Nidec’s finances. It reported a ¥519 billion operating loss for the year ended March after recording a ¥632 billion impairment. The company forecast a return to ¥200 billion in profit on ¥2.8 trillion of sales in the current fiscal year.

The legal claims and ongoing uncertainty over the accounts and a potential delisting may also complicate a sale of the company. Any buyer would have to assess the legal claims, audit questions and whether Nagamori, who remains a major shareholder, would support any transaction.