Renault Keeps Ghosn as Chairman and CEO As Probe Reveals No Wrongdoing

Two automakers, two investigations, and two very different outcomes for one man.

Renault’s board of directors met in France today, deciding that CEO and chairman Carlos Ghosn should stay on in his current role in the wake of an internal investigation that members say showed no signs of criminality. Meanwhile, Ghosn sits in a Tokyo jail, indicted on charges of financial misconduct at Renault’s alliance partner, Nissan.

Away from the Paris streets, it seems everything’s hunky dory in France.

While the Renault probe turned up no illegality in regards to Ghosn’s finances on the French side of alliance, Nissan’s internal investigation turned up enough evidence to prompt the former Nissan chairman’s arrest. The Japanese automaker’s board voted to drop Ghosn after that country’s authorities nabbed Ghosn in Tokyo on Nov. 19.

In a media release, Renault stated:

As part of the agenda, Claude Baland, Senior Advisor in charge of Ethics and Compliance, and Eric Le Grand Chief Ethics and Compliance Officer, presented to the Board of Directors of Groupe Renault the current status of the review concerning the compensation of the Chairman and Chief Executive Officer of Renault for the years 2015-2018 which was undertaken on November 23, 2018. Their preliminary conclusion is that the compensation of the Chairman and Chief Executive Officer of Renault and the conditions under which such compensation was approved were in compliance with applicable law as well as the recommendations of the AFEP-MEDEF.

Japan, as well as Nissan, accuses Ghosn and board member John Kelly (since dropped from its ranks) of under-reporting Ghosn’s income by nearly $80 million between 2010 and 2017. The Japanese indictment, handed down earlier this week, pertains to the 2010-2014 period. Ghosn denies he hid income in statements to Japan’s finance ministry; rather, through his lawyer he claims the compensation was deferred income, to be paid out after his departure. It wasn’t necessary to reveal this income at the time, he claims, though Japan will have the last word on that.

Just yesterday, it was revealed that Nisan received approval to hand over the results of its investigation to Renault. The board has still not had an opportunity to question Ghosn.

“We believe we need to wait on what Carlos Ghosn has to say about this one-sided investigation,” a person familiar with the board meeting told the Wall Street Journal.

In its statement, Renault said, “The Board of Directors requested that Renault’s lawyers continue their review and assessment of the information provided, in liaison with Nissan’s lawyers, and promptly provide the Board with a new update on the situation.”

In addition to reviewing the Nissan dossier, Renault will continue probing financial reports going further back in time. For now, the relationship between the two intertwined automakers remains strained.

[Image: Nissan]