Companies

Nissan shareholders approve post-Ghosn governance overhaul

PTI Yokohama | Updated on June 25, 2019 Published on June 25, 2019

Renault SA’s alliance with Nissan Motor lurched toward a new crisis after developments over the weekend highlighted the deep divide between the two-decade partners. File Photo

Nissan shareholders on Tuesday approved an overhaul intended to strengthen governance at the crisis-hit Japanese auto maker, which is still reeling from the Carlos Ghosn scandal and tensions with French partner Renault.

Shareholders voted in favour of a series of reforms, including the establishment of three new oversight committees responsible for the appointment of senior officials, pay issues and auditing. They also approved the election of 11 directors as the firm restructures, among them two Renault executives as well as current Nissan CEO Hiroto Saikawa.

The reforms are designed to put Nissan on a more stable footing after the shock caused by former boss Ghosn’s arrest on multiple financial misconduct charges. Adding to the company’s operational woes, net profit fell to a near-decade low in the last business year and it has already warned of “a difficult business environment” for the next 12 months.

But the reform plan nearly fell apart after Renault, which owns 43 per cent of Nissan, complained it did not have enough of a say in the new structure. Crisis was averted when Nissan suggested Renault Chairman Jean-Dominique Senard sit on the appointments committee, and CEO Thierry Bollore on the audit committee. However, Renault will not be represented on the new committee on pay -- possibly reflecting long standing rancour in Japan over Ghosn’s high compensation compared to most Japanese CEOs.

Nissan CEO Saikawa has himself come under pressure, both for the disastrous financial performance of the firm and because the Ghosn protege is seen as a legacy of that era. He opened the meeting Tuesday at Nissan’s headquarters in Yokohama outside Tokyo by offering his “sincere regrets” over the tumult that has engulfed the firm in recent months.

Saikawa assured shareholders that he would protect the independence of Nissan, which is part of a three-way alliance with Renault and Japan’s Mitsubishi Motors. Ghosn has accused Nissan executives of seeking to block his plans to more closely integrate the Japanese firm with Renault. And Saikawa said on Tuesday that “autonomy” would remain important for Nissan, while vowing to work with Senard to keep the alliance going in “the most sustainable way”.

Published on June 25, 2019

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