Daily Management Review

Nissan Head of board of directors is arrested


11/19/2018


Carlos Ghosn, Head of the board of directors of the car manufacturing concern Nissan, voluntarily went to the Tokyo prosecutor's office on Monday and was arrested, according to NHK television channel.



Adam via flickr
Adam via flickr
Nissan Motor Co. confirmed in a press release that Ghosn has been underestimating personal income data for many years. Nissan also confirmed that it intends to demand the dismissal of Ghosn and director Greg Kelly. The latter, according to the company, helped Ghosn hide income data.

Asahi newspaper reported earlier on Monday that Ghosn is threatened with arrest on charges of financial irregularities. The top manager allegedly came to the Tokyo prosecutor's office with a confession.

Nissan’s report says that the company received information from an internal source and conducted an investigation.

Significant amounts of Ghosn's remuneration have been criticized for many years, writes Bloomberg. Most of the disputes were heard in France, where, as director of Renault, he was paid about $ 9 million a year. Renault shareholders have refused to approve such payments in the past. These incidents contributed to adoption of the law in France, according to which agreement of shareholders to pay top managers are mandatory.

64-year-old Ghosn, who was born in Brazil in a Lebanese family, is one of the most famous top managers in the global automotive industry. Two decades ago, he saved Nissan from collapse by drastically cutting costs and other changes. Ghosn was one of the architects of the alliance between Renault, Nissan and Mitsubishi, and also actively advocated expansion of partnership with other automakers, including the German Daimler and the Chinese Dongfeng.

He had been in a leading position in Renault since the end of 1996. In 1999, when Renault and Nissan became strategic partners, he was transferred to a Japanese company as a production director, and a year later became its president and CEO. Since 2005, in parallel, he has combined the posts of president and CEO of Renault, and since 2009 he has also headed its board of directors. In December 2016, he was elected Chairman of the Board of Directors of Mitsubishi.

In April 2017, Ghosn transferred his powers as Nissan CEO to Hiroto Saikawa, but remained in charge of the board of directors. 

Renault shares fell 13% at trade in Paris on Monday, to a minimum since 2014. Trading in Nissan shares in Tokyo ended before the news about the possible arrest and dismissal of Ghosn were published.






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