Renault-Nissan chair and CEO Carlos Ghosn. Picture: TOSHIFUMI KITAMURA/AFP
Renault-Nissan chair and CEO Carlos Ghosn. Picture: TOSHIFUMI KITAMURA/AFP

Tokyo — Nissan said it plans to oust chair Carlos Ghosn after alleging he had used company money for personal use and committed other serious acts of misconduct.

Japanese media reported that Ghosn, who is also chairman and CEO of Nissan’s French partner Renault and one of the best-known figures in the global car industry, had been arrested.

The Japanese carmaker said that based on a whistle-blower report, it had been investigating possible improper practices by Ghosn and representative director Greg Kelly for several months, and that it was fully co-operating with investigators.

“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,” Nissan said in a statement.

Neither Ghosn nor Kelly could be reached for comment.

The company said CEO Hiroto Saikawa would propose that the Nissan board remove Ghosn and Kelly.

Shares

Renault shares tumbled 13% in Paris to be among the worst-performing stocks in Europe. Nissan’s German-listed securities plunged 12%.

Ousting Ghosn is bound to raise questions about the future of the alliance that he personally shaped and had pledged to consolidate with a deeper tie-up, before eventually stepping back from its operational leadership.

“The initial share price reaction shows how pivotal he is,” Citi analyst Raghav Gupta-Chaudhary said on Monday.

The news of Ghosn’s arrest was first reported by the Asahi Shimbun, which said it had “learnt that the Tokyo prosecutor’s office asked Nissan chairman Carlos Ghosn on the evening of the 19th to come in voluntarily on allegedly violating the Financial Instruments and Exchange Acts, as he is suspected of underreporting his salary”.

Other local media carried similar reports. The prosecutor’s office declined to comment. Public broadcaster NHK reported that Tokyo prosecutors were raiding Nissan’s headquarters in the city of Yokohama.

“If he is arrested, it’s going to rock the Renault-Nissan-Mitsubishi alliance as he is the keystone of the alliance,” said Satoru Takada, an analyst at TIW, a Tokyo-based research and consulting firm.

“He is the man of charisma for the alliance. It is likely to have a negative impact on its brand image,” he told AFP.

Nicknamed Le Cost Killer, Brazil-born Ghosn is known for overhauling Renault and Nissan starting in the 1990s. Renault came to the rescue of the then-ailing Japanese carmaker in 1999 and parachuted in Ghosn, who set about slashing costs and jobs in a huge corporate overhaul. In 2016, Ghosn also took charge at troubled Mitsubishi after Nissan threw it a lifeline, buying a one-third stake for about $2.2bn as it wrestled with a mileage-cheating scandal that hammered sales.

Ghosn has a high profile in Japan and is known as a major advocate of the country’s auto sector.

Reuters, AFP