Nissan Chairman Ghosn Booted for Bogus Financial Reporting
Japanese automaker Nissan Motor Co. Ltd. has removed chairman Carlos Ghosn and director Greg Kelly from their roles in the company following a months-long whistleblower investigation into allegations of financial misconduct by Ghosn.
According to the Yokohama-based company’s statement, Ghosn and Kelly have been underreporting Ghosn’s compensation in filings with the Tokyo Stock Exchange. Nissan’s investigation also turned up “other significant acts of misconduct” including “personal use of company assets.” Kelly’s complicity “has been confirmed,” the company said.
Nissan has been giving information to Japanese law enforcement officials and there are reports in Japanese media that Ghosn has already been arrested. A report from NHK noted that Ghosen underreported his earnings by about 50% between 2011 and 2013.
Ghosn arrived at Nissan in 1999 from Renault which had just acquired a stake of nearly 40% in the Japanese carmaker. He was installed as Nissan’s COO and was named president the following year and CEO in 2001. In 2005, Ghosn was also named president and CEO of Renault. He added the titles of Nissan chairman in 2008 and chairman of Renault in 2009, retaining his CEO role at both companies as well.
In 2016, Nissan acquired a controlling stake in Mitsubishi and formed a Renault-Nissan-Mitsubishi alliance and Ghosn became chairman of Mitsubishi in addition to his other titles.
The Wall Street Journal reported that last year Ghosn earned ¥962 million (about $8.5 million) according to securities filings for Nissan and €7.4 million (about $8.4 million) from Nissan. The Nissan total includes about $2 million the Ghosn was paid by Mitsubishi.
Renault now owns more than 43% of Nissan and Nissan owns 15% of Renault. Nissan owns a controlling stake of 34% in Mitsubishi.
Nissan stock closed down about 0.5% Monday in Tokyo and Renault traded down about 10% in Paris in the early afternoon Monday. Nissan and Renault both trade over-the-counter in the United States.