Nissan begins search for new chief executive
Nissan has begun the process of replacing its chief executive Hiroto Saikawa, drawing up a list of candidates to lead the struggling Japanese carmaker as it begins an overhaul of its global operations.
The carmaker’s board will meet on Monday to set a formal timetable for the process, and the company’s nomination committee has already been given the specific task of preparing a succession plan, say three people familiar with the situation.
Several candidates have already been approached about a position that, given the turmoil triggered by last November’s arrest of Nissan’s former chairman, Carlos Ghosn, now ranks among the most challenging in the global auto industry. Speculation among Nissan executives is that the committee’s search will focus chiefly on Japanese candidates.
Pressure has been building on the carmaker to replace its leader following a collapse in its profits, a string of scandals and a 36 per cent fall in its share price during Mr Saikawa’s tenure.
At the carmaker’s annual meeting of shareholders in June, Mr Saikawa only secured enough support from investors after Nissan’s alliance partner Renault voted 43 per cent in favour of his reselection.
Ahead of that meeting, two of the largest proxy advisory services, Institutional Shareholder Services and Glass Lewis recommended a vote against Mr Saikawa’s reappointment. They argued that because he served as chief executive under Mr Ghosn’s chairmanship and was long seen as one of his closest allies, it was difficult to consider him totally unconnected to Mr Ghosn’s alleged wrongdoing.
Removing Mr Saikawa from his position clears one of the major barriers to closer co-operation between Nissan and Renault, as relations between him and Renault chief executive Thierry Bolloré remain badly soured.
A change at the top of Nissan may also potentially open the door to further talks between Renault and Fiat Chrysler about a future combination, months after the pair called off negotiations over a €33bn merger.
The potential change of leadership comes as Nissan is due this week to submit to its own board the findings of a 10-month inquiry into the finances of former chief executive Mr Ghosn, who was arrested last November on financial misconduct charges. Since it began, say people involved, the investigation has been repeatedly widened in scope. Along the way, it has provided significant quantities of information that have been passed to Tokyo prosecutors as they prepare for a trial expected to begin early next year.
Mr Ghosn has consistently denied all charges.
The investigation has already found that several of its senior executives, including Mr Saikawa, received excess payments as part of an incentive scheme that paid out cash depending on Nissan’s share price performance. Although the excess payments were not illegal, the operation of the incentive scheme was described by Mr Saikawa himself as “different to what it should have been”.
After years as a loyal deputy to Mr Ghosn, Mr Saikawa took over in April 2017, when the then-leader stepped back to become chairman.
Since then, Nissan has embarked on Japanese retrenchment that has seen it shed international executives and pull back production of some models to its home country.
In response to a 95 per cent fall in its first-quarter profits earlier this year, Nissan decided to cut 12,500 jobs outside of Japan, around a tenth of its workforce.
The group is also pulling back from some markets, moving its premium Infiniti business from Hong Kong and is mulling exiting the troubled South Korean market.
At home, the group has been rocked by a number of certification scandals that forced it to halt production at its Japanese plants.
Nissan declined to comment on plans for Mr Saikawa’s replacement.