By on October 7, 2019

On Tuesday, a subset of Nissan’s board intends to request access to a list of 80 Nissan employees suspected of aiding former Chairman Carlos Ghosn in his alleged financial malfeasance. Assembled by Nissan’s former audit chief, Christina Murray, and company, the document compiles actions taken by staffers believed to have assisted Ghosn directly or attempted to impede the resulting investigations.

Among them is Hari Nada, Nissan’s vice president, who oversees the company’s legal department. Despite being instrumental in Ghosn’s November arrest by acting as a whistleblower to Japanese authorities, along with Toshiaki Onuma, his role as one of the ousted executive’s many confidants has placed him under suspicion — as did his reluctance to recuse himself from the company’s legal affairs.

Nada is now being pressured to resign. However, it’s not clear if this is the result of any actual wrongdoing or an internal power struggle happening inside the Renault-Nissan-Mitsubishi Alliance. Considering the power vacuum created by Ghosn’s arrest and the swift retirement of ex-CEO Hiroto Saikawa (who also makes the 80-person list), both scenarios seem equally plausible. 

According to Bloomberg, Nada was recently implicated in a scandal involving excess stock-linked compensation — an issue that also led to Saikawa’s resignation in September.

The Wall Street Journal had more on how Murray’s report played into this and the ongoing management tussle:

Most of the directors at Nissan are relatively new to the job, having joined after the company’s annual meeting in June. The tensions over the list and Mr. Nada’s role reflect a broader power struggle between some of Nissan’s top management — largely holdovers from the Ghosn era — and the board over the company’s direction.

At the monthly board meeting in September, directors were briefed on the results of Nissan’s nearly yearlong investigation into alleged wrongdoing by Mr. Ghosn. The directors initially were given a five-page overview of the findings, instead of the full 170-page report, although they got it a few days later, said people involved in the discussions.

The full report deals mainly with allegations about Mr. Ghosn and his former aide, Greg Kelly, according to people who have seen it. When some board members asked about the lack of details on possible wrongdoing by others, they were told about Ms. Murray’s list, said people who attended the meeting.

Board members then asked to see Ms. Murray’s list, which ranks people over the severity of their actions on a scale of 0 to 5 and gives Mr. Nada a 5, according to people who have seen it. It hasn’t been shared with the full board, said the people familiar with the board’s thinking.

The longtime Nissan employee is believed to be closely involved with many aspects of the chairman’s compensation, serving as one of three administrators at Zi-A Capital BV — the Dutch subsidiary of Nissan created by Kelly that purchased a house for Ghosn in Beirut using the allegedly ill-gotten finances. Nada is also said to have been aware of documents proposing payments totaling $80 million be made to Ghosn after his retirement.

While his status as a whistleblower was supposed to save him from the law, it doesn’t guarantee he’ll have a place to work. If Nissan’s board presses for his resignation, which seems to be the case, Renault is expected to follow suit. But nobody at the company has accused him of doing anything illegal. Instead, the board is focusing on how his involvement in Ghosn’s previous dealings may have created morale and trusts issues within the automaker — likely doing the same with other employees named in the list.

“We have to decide on clear methods to stop this,” one of the directors told The Wall Street Journal. “We may need to change the people in charge quickly. Whether we can remains to be seen.”

While Tuesday’s meaning is primarily intended to help Nissan decide its next CEO before the end of this month, Murray’s list and Nada’s forced retirement are bound to come up. Meanwhile, Ghosn and Kelly continue to profess their innocence by claiming this is all a management coup staged to make them look like criminals.

We can’t possibly claim to know whether or not Ghosn is innocent. But his claims that there’s a management war happening inside Nissan more valid than ever before.

[Image: Memory Stockphoto/Shutterstock]

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5 Comments on “Nissan’s Management Problem...”


  • avatar
    Noble713

    Jeez, starting to look like the Soviet Great Purge up there. Nobody is safe.

    • 0 avatar

      Welcome to the clash between Eastern culture vs Western culture. There is a reason why Democracy and free society never developed in the East and why the West won.

    • 0 avatar
      jmo2

      At this point there is no longer any question that Ghosn did actually steal 10s of millions, right? Hasn’t that been pretty firmly established?

      • 0 avatar
        SPPPP

        As I understand it, the main issue with Ghosn was that his compensation was set up in such a way that he reported one figure to the Japanese tax authority and to shareholders, but actually received more. This was apparently done with the consent of key executives within Nissan, including then-president-and-CEO Hiroto Saikawa. Instead of simply giving him a raise, “they” looked for any loophole they could find to pay him without public disclosure. This case basically rests on tax fraud and shareholder disclosure laws. Therefore, I don’t think you can conclusively say he stole money from Nissan. I guess you could say that he stole money from Japan’s tax coffers by improperly delaying compensation and otherwise under-reporting income.

        The often-repeated idea that Ghosn was accused of wrongdoing in order to eliminate him from the company looks quite plausible. But Nissan’s executives look increasingly incompetent as the company’s executives are forced to admit their own culpability in the situation. Which, under American law, means that Nissan itself is liable to fines and sanctions.

        https://www.accountingtoday.com/articles/how-carlos-ghosn-hid-140m-in-compensation-from-nissan

        https://www.nytimes.com/2019/08/25/business/nissan-ghosn-lawsuits.html

  • avatar
    thejohnnycanuck

    Good job. This is precisely the kind of teamwork Nissan needs at a time when profits are soaring and sales are through the roof.

    Oh, wait…

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