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Abu Dhabi, UAEThursday 21 March 2019

Nissan said to look outside for a new board chairman

Carlos Ghosn had held roles of both board chair and head of of company board prior to his arrest

Renault chairman Jean-Dominique Senard arrives in Japan to meet Nissan CEO Hiroto Saikawa. EPA
Renault chairman Jean-Dominique Senard arrives in Japan to meet Nissan CEO Hiroto Saikawa. EPA

A Nissan Motor governance committee will recommend the appointment of an external director as board chairman, a role distinct from company chairman, in a move to decentralise power at the top level, the Nikkei business daily reported on Sunday.

Under Nissan's current corporate charter, the position of board chair is automatically appointed to head the company board, the Nikkei said citing a source. Former chairman Carlos Ghosn had filled both roles prior to his arrest in November for under-reporting his salary for eight years, Bloomberg said.

The issue of Nissan's chairmanship is now particularly important after the Japanese firm identified the concentration of power in one executive as one of the reasons Mr Ghosn was able to carry out his alleged fiscal misconduct.

The Nikkei report came as Mr Ghosn’s successor as Renault’s chairman made his first visit to car alliance partner Nissan, starting his bid to mend the relationship strained by the car titan’s arrest.

The new Renault chairman, Jean-Dominique Senard, spent Thursday and Friday in Japan and met with Nissan chief executive Hiroto Saikawa and other board members and executives. Mr Senard and Mr Saikawa discussed the operations of what is the world’s biggest car alliance and Nissan’s current initiatives, among other topics, a Nissan spokesman said.

The visit is among the first steps by Mr Senard to tackle the challenges facing the Franco-Japanese partnership as the sides try to forge a fresh path without Mr Ghosn, who enforced a common vision on the alliance over two decades. Nissan is said to have sought a review of the pact’s lopsided power structure, while Mr Saikawa has criticised Mr Ghosn for having too much authority and making decisions that weren’t in the best interest of the Japanese company.

Until his November 19 arrest in Japan on allegations of financial misconduct at Nissan, Mr Ghosn led an automotive empire that stretched around the globe. He not only ran Renault as chairman and CEO, but also served as chairman at Nissan and Mitsubishi Motors, the third alliance partner.

Mr Senard also had an appointment with Mitsubishi Motors CEO Osamu Masuko and other managers, with the meeting going “very well”, according to Mitsubishi chief operating officer Trevor Mann.

The arrest of Mr Ghosn has intensified existing tensions between the partners. Among the challenges, Nissan is unwilling to support an arrangement with Renault that would place the same person in the chairman’s role at both companies, as was the case under Mr Ghosn, a source said this month. That means Nissan would resist appointing Mr Senard as its own chairman as well.

While Mr Senard’s first contact with Mr Saikawa went well, Nissan opposes having him in the top role because it fears a conflict of interest, the source had said. Renault has a 43 per cent voting stake in Nissan, which has no reciprocal rights with its 15 per cent stake in its French partner.

Nissan’s board will await a governance committee report before taking a final decision regarding who its new chairman should be. The committee, set up to address corporate-governance failures at Nissan discovered amid the Ghosn scandal, had its third meeting Friday, Nissan said.

Nissan has said it plans to appoint Mr Senard to its board as a director after a shareholder vote on April 8. Mr Ghosn and his long-time aide Greg Kelly will be removed at the same time.

Updated: February 17, 2019 07:16 PM

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