Following the sensational scandal of then-CEO Carlos Ghosn, Yokohama-based Nissan Motor Co. is again caught in trying times.
Right when the Alliance is in the midst of a reorganization, and Nissan building itself back up from the effects of Ghosn’s arrest, the CEO that led the ousting of Ghosn has just admitted to receiving what was coined as “dubious” income.
In what seemed to be an inflation of his salary, now-former CEO Hiroto Saikawa acknowledged that he did, in fact, accept the money. In a bit of a contradiction, he also said that he was unaware of the said adjustment.
As of yesterday, September 9, 2019, the Board of Nissan Motor Co., Ltd. held their regular Board of Directors meeting. Hiroto Saikawa had indicated recently his willingness to resign. After discussion, the Board asked him to resign as representative executive officer and CEO of the company, effective September 16, and he accepted. Effective the same day, Nissan’s representative executive officer and COO, Yasuhiro Yamauchi, will become acting CEO.
Following an internal investigation, Saikawa’s compensation was shown to have been boosted by what was roughly equivalent to JPY 96.5M (approximately USD 900,000 at that time) in 2013; supporting documents for such an increase were found to have been falsified.
“It would have been better if I had been able to resolve everything first. I have been trying to do what needs to be done so that I can pass the baton over as soon as possible. I am sorry to investors, customers and of course our workers, (sic)”, Saikawa was quoted to have said following an evening news conference held at Nissan headquarters in Yokohama.
Almost a year after the arrest of Carlos Ghosn, financial issues have continued to hound Nissan, while others seem to continue to profit off of what’s left of the company, or so it seems.
Given the above-mentioned internal investigation, Nissan Chairman Yasushi Kimura said that it was revealed that the alleged misconduct of former chairman Ghosn and Greg Kelly, former Nissan director, cost Nissan Motor Co. what looks up to the amount of JPY 35 billion. The company will not disclose any further details, though, because of the ongoing judicial proceedings.
In contrast to Saikawa admitting to accepting funds (albeit “unknowing” of its illegalities), Carlos Ghosn has since maintained his innocence. As if Nissan isn’t neck-deep in troubles as it were, lawyers through CNN Business have shown a recorded statement from Carlos Ghosn himself.
In what he alleges as “…a conspiracy. … not about greed, dictatorship. … This is about a plot. … This is about backstabbing. … Why it happened? Because there was first: fear; that the next step of the lines in terms of convergence, in terms of moving toward the merger would in a certain way threaten some people, or eventually threaten the autonomy of Nissan.”
On the topics of mergers, and with a tumble in Nissan’s profits over the past year, their relationship with Alliance partner Renault has also been met with a lot of concern and worry. It has also been alleged that both Nissan and Renault are rather unhappy with the governing rules that they put in place for their partnership. The most glaring concern is that Nissan is reportedly eager to have Renault reduce its holdings of its shares. The French automaker has a 43% stake in the Japanese partner. A reduction to 20% to 25% would satisfy Nissan but not Renault. How they resolve this remains to be seen.
With all the talks about arrest, resignations, legal proceedings, rule revamps, it is worth noting that we have not yet heard much (or anything at all) from the third member of the Alliance, which is Mitsubishi Motors.
More importantly, with both Nissan and Mitsubishi’s rather significant presence in the Philippines, how will all of these affect their business, and their consumers as well?