Nissan moves to shoot Carlos Ghosn as president for "misconduct"



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In this photo taken on September 12, 2018, Carlos Ghosn, CEO of the Renault group of France and president of Japan's Nissan Motor Co. Ltd., poses during a photo shoot at Renault's headquarters in Boulogne-Billancourt, France. (Joel Saget / AFP / Getty Images)

Nissan Motors said Monday that chairman Carlos Ghosn was arrested after the company discovered "significant acts of misconduct", including underreporting of his own salary and use of company assets for his personal benefit.

Ghosn is considered one of the top executives in the auto industry and is one of Japan's highest paid corporate bosses. He is widely credited for saving Nissan from near bankruptcy. He also serves as president and chief executive officer of Renault France and president of Mitsubishi Motors.

Born in Brazil, a descendant of Lebanese and a French citizen, he is one of the few foreigners in such an important position in Japan.

Nissan has reported that it has conducted an internal investigation in recent months based on a report by a whistleblower alleging Ghosn and deputy director Greg Kelly, and shared his findings with public prosecutors for his own parallel investigation.

"I am not in a position to talk about the progress of the investigation itself, but as a result of the investigation, we heard that the arrests were made of the two masters," said CEO Hiroto Saikawa at a news conference at the company's headquarters. in Yokohama.

Saikawa said he would convene a council meeting on Thursday to remove Ghosn and Kelly.

"The investigation showed that over many years Ghosn and Kelly reported compensation values ​​in the Tokyo Stock Exchange securities report that were lower than the actual amount in order to reduce the reported amount of Carlos Ghosn's compensation," he said the Nissan said in a statement. .

"In addition to Ghosn, several other significant acts of misconduct have been discovered, such as personal use of the company's assets, and Kelly's deep involvement has also been confirmed."

Renault's shares fell more than 10 percent in Paris, while Nissan's shares in Germany fell nearly 10 percent.

Ghosn, 64, began his career with tire manufacturer Michelin in France in 1976 before moving on to Renault in 1996. There he helped design a turnaround in the carmaker's fortunes that earned him the nickname "Le Cost Killer" .

He joined Nissan in 1999 after Renault bought a controlling stake and became its CEO from 2001 until 2017. Ghosn then stepped down as CEO of Nissan but remained the company's chairman. He has become a star in the business world in Japan, even generating a manga comic in his life, though he has also drawn criticism for his high salary.

Ghosn was one of the first executives to sponsor electric cars and also developed a range of low-cost cars for emerging markets.

In June, Renault shareholders approved Ghosn's compensation of 7.4 million euros ($ 8.5 million) for 2017. He also received the equivalent of more than $ 10 million in his senior year as chief executive of Nissan.

Saikawa said that the "concentration of power in an individual" in the auto conglomerate could have been a factor in allowing misconduct to occur, and lamented the astonishment and anxiety that the news caused to employees and shareholders.

"It's very difficult to put it into words," he said. "In addition to regretting it, I feel a great disappointment and frustration and despair and resentment."

In its statement, Nissan also apologized deeply for causing great concern to shareholders and stakeholders. "We will continue our work to identify our governance and compliance issues and take appropriate action," the company said.

The news is the latest scandal to tarnish the Nissan brand. In July, it admitted having discovered fake emissions data from most of its plants in Japan, while in 2017 it admitted having allowed unqualified personnel to perform post-production tests at some of its factories, forcing it to recover more than one million vehicles. reinspection.

While the company denied a direct link between its failure to conduct adequate tests and its ongoing efforts to cut costs, Yasuhiro Yamauchi acknowledged at the time that "it was necessary to reflect on whether there was an environment at Nissan where anything could be tolerated if it costs ".

Akiko Kashiwagi contributed to this report.

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