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Last Updated : Nov 19, 2018 07:29 PM IST | Source: Moneycontrol.com

Nissan considers ousting Carlos Ghosn for financial misconduct

The CEO Hiroto Saikawa was quoted saying he will bring up a proposal to dismiss Ghosn at a board meeting on November 22.

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Nissan Motor is considering ousting Carlos Ghosn from the position of Chairman after finding that he had used company money for personal use and committed several other serious acts of misconduct.

The CEO Hiroto Saikawa was quoted saying he will bring up a proposal to dismiss Ghosn at a board meeting on November 22.

According to a Reuters report, Ghosn has already been arrested by Tokyo prosecutors on suspicion of under-reporting his salary. Earlier, several outlets had reported he was being questioned.

The Japanese automaker said based on a whistleblower report, it had been investigating possible improper practices of Ghosn and Representative Director Greg Kelly for several months, and that it was fully cooperating with investigators.

"Based on a whistleblower report, Nissan Motor Co., Ltd. (Nissan) has been conducting an internal investigation over the past several months regarding misconduct involving the company’s Representative Director and Chairman Carlos Ghosn and Representative Director Greg Kelly, " Nissan said in a release.

"The investigation showed that over many years both Ghosn and Kelly have been reporting compensation amounts in the Tokyo Stock Exchange securities report that were less than the actual amount, in order to reduce the disclosed amount of Carlos Ghosn's compensation," Nissan said.

The statement said numerous other significant acts of misconduct have been uncovered against Ghosn, such as personal use of company assets, and Kelly’s deep involvement has also been confirmed.

It said CEO Hiroto Saikawa would propose to the Nissan board to remove Ghosn and Kelly.

"As the misconduct uncovered through our internal investigation constitutes clear violations of the duty of care as directors, Nissan’s Chief Executive Officer Hiroto Saikawa will propose to the Nissan Board of Directors to promptly remove Ghosn from his positions as Chairman and Representative Director. Saikawa will also propose the removal of Greg Kelly from his position as Representative Director," the release stated.

The news comes as a shock in Japan where Ghosn, a rare foreign top executive, is well regarded for having turned Nissan around from near bankruptcy. Ghosn is also chairman and chief executive of France's Renault.

The Asahi newspaper reported on its website that prosecutors had begun searching the offices of Nissan's headquarters and other locations.

The Tokyo District Public Prosecutors Office declined to comment.

Nissan said it would brief reporters on Monday evening. Spokesmen for Renault and the Renault-Nissan-Mitsubishi Motors alliance did not immediately return calls and messages seeking comment on the arrest reports.

An ouster of Ghosn, 64, is bound to raise questions about the future of the alliance that he personally shaped and had pledged to consolidate with a deeper tie-up, before eventually stepping back from its operational leadership.

Brazilian-born, of Lebanese descent and a French citizen, he began his career at Michelin in France, moving on to Renault. He joined Nissan in 1999 after Renault bought a controlling stake and became its CEO in 2001. Ghosn remained in that post till last year.

In June, Renault shareholders approved Ghosn's 7.4 million euro ($8.45 million) compensation for 2017. In addition to this, he received 9.2 million euros in his final year as Nissan chief executive.

(With inputs from Reuters)
First Published on Nov 19, 2018 04:41 pm
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