Groupe Renault has conevened an emergency board meeting to address the request made by Nissan to remove the current Director and Chairman, Carlos Ghosn.
The news regarding financial misconduct spread early on Monday when Nissan’s Chief Executive Officer Hiroto Saikawa revealed about an internal investigation which found Renault’s Ghosn to be guilty of financial irregularities in Tokyo Stock Exchange.
The Japanese manufacturer decided to investigate after a whistleblower report which proved to be true. This resulted in Nissan to request the Alliance of Renault-Nissan-Mitsubishi to expel Ghosn with immediate effect.
Not only Ghosn but also Renault’s Director Greg Kelly – both of whom are believed to be already arrested in Japan as per the company. The stock price for Renault has plunged down hugely since the news broke out.
The statement from Nissan stated:“Based on a whistleblower report, Nissan Motor Co., Ltd. (Nissan) has been conducting an internal investigation over the past several months regarding misconduct involving the company’s Representative Director and Chairman Carlos Ghosn and Representative Director Greg Kelly.
“The investigation showed that over many years both Ghosn and Kelly have been reporting compensation amounts in the Tokyo Stock Exchange securities report that were less than the actual amount, in order to reduce the disclosed amount of Carlos Ghosn’s compensation.
“Also, in regards to Ghosn, numerous other significant acts of misconduct have been uncovered, such as personal use of company assets, and Kelly’s deep involvement has also been confirmed. Nissan has been providing information to the Japanese Public Prosecutors Office and has been fully cooperating with their investigation. We will continue to do so.
“As the misconduct uncovered through our internal investigation constitutes clear violations of the duty of care as directors, Nissan’s Chief Executive Officer Hiroto Saikawa will propose to the Nissan Board of Directors to promptly remove Ghosn from his positions as Chairman and Representative Director. Saikawa will also propose the removal of Greg Kelly from his position as Representative Director.
“Nissan deeply apologizes for causing great concern to our shareholders and stakeholders. We will continue our work to identify our governance and compliance issues, and to take appropriate measures.”
Mitsubishi also sided with Nissan in the request: “In response to the arrest of Ghosn, and since the alleged misconduct is related to a corporate governance and compliance issue, it is to be proposed to the board of directors to promptly remove Ghosn.”
In response to the request made by Nissan, the French arm has convened an emergency meet to hear Ghosn’s defence and then take a call in the matter. “Philippe Lagayette, as lead independent director of Renault, in liaison with Board Committee Chairs Marie-Annick Darmaillac and Patrick Thomas, have acknowledged the contents of Nissan’s press release of today.
“Pending provision of precise information from Carlos Ghosn, Chairman and Chief Executive Officer of Renault, the above directors wish to express their dedication to the defense of Renault’s interest in the Alliance. The Board of Directors of Renault will be convened very shortly,” said Groupe Renault’s statement.
Although Ghosn isn’t involved in a day-to-day running of Renault’s motorsport activities – including Formula 1, but he is the one that the current Renault Sport Racing head Jerome Stoll reports to on all the matters for the final approval.
Stoll is already moving out and will be replaced by Thierry Koskas in 2019. It remains to be seen how it effects Renault’s motor racing activities, especially F1 where it returned few years back as an active racing team with the aim to win the championship.