What is Fujitsu, the Japanese IT company at centre of Post Office’s Horizon scandal

Sunak government facing pressure to hold tech firm accountable ‘legally and finacially’

Fujitsu — the Japanese tech firm behind the faulty Horizon accounting software at the centre of the British Post Office scandal — has been urged to take accountability for the defective tech that may have led to the wrongful prosecution of hundreds of staff.

The IT giant is now the subject of an inquiry to decide whether it is culpable for the scandal that led to the prosecution of more than 700 Post Office staff, accused of stealing after Horizon showed shortfalls in their branches’ accounts.

But it is not the first time Fujitsu’s software has been at the centre of a public scandal.

Since its foundation in 1935 in Japan's Kawasaki, the company has produced everything from laptops and supercomputers to chips, software, mobile phones and home appliances. The company grew during Japan's postwar economic boom, further extending its services to Western nations, including the UK.

Fujitsu was the company behind Japan’s first ever computer – the FACOM 100.

"Fujitsu combines the power of IoT with digital technologies, AI, and network solutions to deliver hyperconnected business transformation," a statement on the £23.8bn company’s website reads.

Helmed by chief executive Takahito Tokita, the firm now caters to a growing number of Japanese companies embracing digital workflows to keep up with technological mobility.

Mr Tokita and a group of 49 executives are responsible for the operations of the company.

Fujitsu is headquartered in Tokyo but operates through extended divisions and facilities in China, Germany, New Zealand, Singapore, Taiwan, Thailand, India, the UAE, the UK and the US.

Company’s reputation

Despite its long and impressive history, Fujitsu has been involved in a string of scandals and software glitches that have tarnished its reputation among ordinary citizens in Japan.

In 2002, Fujitsu was one of three firms that came fire for glitches at ATMs belonging to one of Japan's major banks, resulting in 2.5 million delayed debits.

The company was blamed for a trading loss of $300m (£234m )in 2005 after its Tokyo Stock Exchange software was unable to cancel an incorrect order. Following a decade-long legal battle, a court in Japan ruled in 2015 that the firm's software wasn't legally liable.

Nearly two decades later, the company’s software supporting the operations of the stock exchange failed again – causing the loss of a full day’s trading in 2020.

“We apologise for any inconvenience caused to the concerned parties because of a failure in the hardware we delivered,” a spokesperson for the company said in a statement at the time. The incident prompted the company boss’s to take a 50 per cent pay cut for four months in an act of public penance.

In June of 2023, at least 123 municipalities had to suspend the operation of a Fujitsu-based system to issue residence cards to holders of the country’s ‘My Number’ ID card, according to The Spectator.

A month prior to the incident machines in convenience stores issuing municipal certificates began malfunctioning.

“They are a national disgrace,” the report quoted one Japanese national as saying.

Fujitsu’s past dealings with UK government

Horizon was rolled out in 1999 and began reporting false cash shortfalls at branches across the country. The accusations tore people’s lives apart, with many losing their jobs and homes.

Fujitsu said it was committed to supporting an inquiry that has been underway since 2021. "The inquiry has reinforced the devastating impact on postmasters' lives and that of their families, and Fujitsu has apologised for its role in their suffering," the firm said in a statement this week.

The same year of Horizon’s implementation, the firm won a £184m contract to develop software to standardise case management transactions across over 300 magistrates' courts.

The software – Libra – cost three times more than expected but struggled to produce even basic financial information.

Fujitsu was also one of the four companies tasked with digitising the NHS in 2004. But the British authorities terminated the contract in 2008 due to the company’s alleged failure to deliver the promised product.

The Japanese company eventually sued the NHS and won the case in 2014, the BBC reported. The termination cost the UK government £700m.

Despite the various controversies, Fujitsu was awarded nearly over 190 public contracts worth approximately £6.7bn in the past decade, according to analysts Tussell.

About 43 of those contracts were still in operation, amounting to £3.6bn, which included the contract for Horizon. Fujistu’s revenue from its public sector contracts totalled £427m in the 2021-22 financial year, Tussell found.

The company was removed from the British government's list of preferred suppliers in 2022, however, it continued to still win government contracts through the regular procurement process.

Ministers tried to prevent Fujitsu getting more official work but this proved “impossible” despite its “woeful” performance, a Tory peer said on Wednesday.

Lord Maude of Horsham, who served as Cabinet Office minister under David Cameron, said procurement rules thwarted ministers’ efforts.

He said if Fujitsu had “any sense of honour” it would swiftly make a significant payment towards the compensation of wrongly convicted subpostmasters.

The Independent has reached out to Fujitsu for comment.