Ghosn's Days As an Auto Executive Could End Tomorrow
As the Carlos Ghosn saga slowly crawls its way towards a trial, the former Nissan and Mitsubishi chairman might soon add another “former” to his list of descriptors. In an effort to mend a rift in the automotive alliance, Renault’s board has scheduled an emergency meeting for Thursday, during which the pressure will be on to oust Ghosn as the automaker’s chairman and CEO.
As he cools his heels in jail, Ghosn isn’t in a position to offer much resistance to any decision rendered by the board. The exec has reportedly offered to resign.
While Nissan and Mitsubishi dropped Ghosn not long after his Nov. 19 arrest on suspicion of underreporting income to Japanese regulators, Renault held out. Its partial French ownership and Ghosn’s nationality played a role, and the diverging decisions soon placed a strain on the alliance relationship.
According to the Financial Times, Ghosn’s failure to secure bail earlier this week was the final straw for his tenure as Renault boss. Sources close to the talks claim that Ghosn, realizing he’ll be held in jail until his trail, has begun making formal arrangements to resign his posts.
Renault and the French government have been discussing the terms of Mr Ghosn’s departure ahead of its board meeting on Thursday where the company is expected to appoint Jean-Dominique Senard, chief executive of tyremaker Michelin, as chairman while Thierry Bolloré, who is already running the business in Mr Ghosn’s absence, is made chief executive.
On Tuesday, Bruno Le Maire, France’s finance minister, said on French television that Mr Senard “would make an excellent chairman of Renault”.
Mr Ghosn is also expected to step down as chief executive and chairman of the Renault-Nissan-Mitsubishi alliance. Mr Senard is then expected to take over his roles, according to people close to the group.
Japanese authorities have charged Ghosn with underreporting his income for years, as well as transferring personal trading losses to Nissan. While the executive maintains he has done nothing wrong, two bail appeals in the past week both met with disappointment.
Late last week, Nissan and Mitsubishi issued a joint media release detailing the findings of an internal investigation. In it, the companies exposed another alleged misdeed. Ghosn is accused of receiving “improper” payments from Nissan-Mitsubishi B.V., a Netherlands-based joint venture, of which the disgraced exec served as director.
From the release:
The joint investigation has confirmed that Ghosn entered into a personal employment contract with NMBV [Nissan-Mitsubishi B.V., a Netherlands-based joint venture] and that under that contract he received a total of 7,822,206.12 euros (including tax) in compensation and other payments of NMBV funds. Despite the clear requirement that any decisions regarding director compensation and employment contracts specifying compensation must be approved by NMBV’s board of directors, Ghosn entered into the contract without any discussion with the other board members, Nissan CEO Hiroto Saikawa and Mitsubishi Motors CEO Osamu Masuko, to improperly receive the payments.
In addition, the investigation has also confirmed that soon after the announcement in 2016 that Nissan and Mitsubishi Motors would forge a strategic alliance, Ghosn, former representative director Greg Kelly and others began to explore the possibility of paying undisclosed compensation to Ghosn through an equally-owned Netherlands-based unconsolidated joint venture between the companies.
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