Carlos Ghosn’s Successor at Nissan? The Board Is in No Hurry
TOKYO — Nissan Motors did not name a new chairman at a board meeting on Monday, nearly a month after the Japanese automaker removed Carlos Ghosn as chairman, saying instead that it would appoint a special committee to review its corporate governance and its director compensation system.
Mr. Ghosn, along with the company itself, was indicted last week on charges that they violated Japanese financial laws by underreporting Mr. Ghosn’s compensation in securities filings. Mr. Ghosn, who was first arrested in November, currently sits in a Tokyo detention center after being rearrested on a separate charge of underreporting compensation for a different time period.
Speaking after a meeting of Nissan’s board, Hiroto Saikawa, the automaker’s chief executive, said the group had not set a deadline for naming a successor to Mr. Ghosn. “We shouldn’t hurry,” Mr. Saikawa said. “We should not be slipshod.”
Nissan said the special committee would include four outside advisers and three current Nissan directors and would submit its recommendations by the end of March.
Nissan is struggling to cope with the fallout from Mr. Ghosn’s indictment, which has left its alliance with Renault, the French carmaker, in disarray. Renault, which installed Mr. Ghosn at Nissan nearly two decades ago at a time when the Japanese carmaker was on the brink of bankruptcy, now owns 43 percent of the company that Mr. Ghosn is credited with reviving.
Mr. Ghosn stepped down as chief executive of Nissan last year but remained as chairman. He is also chairman and chief executive of Renault. Although the French carmaker has appointed a leadership team to run the company on an interim basis while Mr. Ghosn is in detention in Tokyo, its board said last week that an internal inquiry into his compensation had found no irregularities and that he would remain chief executive.
Nissan said it conducted an extensive internal inquiry into allegations that Mr. Ghosn worked with a fellow board member, Greg Kelly, a former human resources manager at Nissan, to develop hidden compensation packages and use corporate resources for personal use.
Nissan turned over the results of its investigation to Tokyo prosecutors, who initially arrested Mr. Ghosn and Mr. Kelly on Nov. 19. Mr. Kelly has also been indicted and remains in detention in Tokyo.
According to a person with knowledge of Nissan’s investigation, Thierry Bolloré, deputy chief executive of Renault, sent a letter last week to Mr. Saikawa urging Nissan’s board to call a general shareholders’ meeting to review the company’s corporate governance policies and vote on replacements for Mr. Ghosn and Mr. Kelly, both of whom remain on the board.
Editors’ Picks
Ellen DeGeneres Is Not as Nice as You Think
Where Brexit Hurts: The Nurses and Doctors Leaving London
Gaming Out a Chance at Motherhood — Later
Mr. Saikawa on Monday declined to comment on the letter but said Nissan would determine when it names a successor to Mr. Ghosn. “We will listen to what they have to say, but at the end of the day we are responsible for Nissan’s governance,” he said.
Corporate governance experts have noted that Nissan had not adhered to voluntary recommendations that companies appoint a separate compensation committee made up of independent directors. In fact, Mr. Ghosn, as chairman, retained ultimate discretion over pay of all the directors.
“I think one of the most acute issues here is that there has been excessive concentration of power into one person,” said Seijiro Takeshita, dean and professor at the School of Management and Information at the University of Shizuoka. “I don’t think anyone can deny that.”