Nissan Staff With Ghosn Ties Under Fire -- WSJ

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10/08/2019 | 06:47 am
Carlos Ghosn


By Sean McLain




TOKYO -- Some Nissan Motor Co. directors will demand at Tuesday's board meeting to see a list of around 80 Nissan employees who may have assisted former Chairman Carlos Ghosn in alleged wrongdoing, said people familiar with the board's thinking, setting up a potential clash with management.



The list was compiled by Nissan's former audit chief, Christina Murray, and others. It outlines the actions of around 80 employees who they believed assisted Mr. Ghosn or obstructed the investigation into his actions, said people who have seen the list.



Tensions are rising between the board and Nissan management, in particular over one of the people on the list, Hari Nada, a Nissan vice president who oversees its legal department and worked closely with Mr. Ghosn on sensitive matters.



Mr. Nada was among a group of Nissan executives who secretly cooperated with Japanese prosecutors ahead of Mr. Ghosn's arrest last November, and his role has led some Nissan lawyers to say he should have recused himself from all legal affairs at the company.



Directors plan to ask that Nissan request Mr. Nada's resignation or have his role at the company diminished, but they believe there will be resistance from management, according to the people familiar with the directors' views. Should the board fail to persuade management to remove Mr. Nada and other employees who directors believe are helping to shield him, the directors will leave the task to the next Nissan chief executive, the people said.



The auto maker is searching for a permanent CEO after Hiroto Saikawa, Mr. Ghosn's successor, resigned from the job last month.



Nissan declined to make Mr. Nada available for comment. The company declined to comment about planned discussions at its next board meeting.



Most of the directors at Nissan are relatively new to the job, having joined after the company's annual meeting in June. The tensions over the list and Mr. Nada's role reflect a broader power struggle between some of Nissan's top management -- largely holdovers from the Ghosn era -- and the board over the company's direction.



At the monthly board meeting in September, directors were briefed on the results of Nissan's nearly yearlong investigation into alleged wrongdoing by Mr. Ghosn. The directors initially were given a five-page overview of the findings, instead of the full 170-page report, although they got it a few days later, said people involved in the discussions.



The full report deals mainly with allegations about Mr. Ghosn and his former aide, Greg Kelly, according to people who have seen it. When some board members asked about the lack of details on possible wrongdoing by others, they were told about Ms. Murray's list, said people who attended the meeting.



Board members then asked to see Ms. Murray's list, which ranks people over the severity of their actions on a scale of 0 to 5 and gives Mr. Nada a 5, according to people who have seen it. It hasn't been shared with the full board, said the people familiar with the board's thinking.



At Tuesday's board meeting, "directors plan to ask for this other report, and won't leave without a full explanation of it," said one of those people.



Nissan hasn't withheld Ms. Murray's list for nefarious reasons, said one of the people familiar with its contents. This person said any discussions about wrongdoing by employees should be based on the 170-page report, which was produced by Nissan's longtime outside law firm, Latham & Watkins.



The 80-name list was overly broad and "a complete mischaracterization of Latham's findings," this person said.



Messrs. Ghosn and Kelly have been charged in Tokyo with financial crimes. They say they are innocent.



Some directors are concerned about what they see as an attempt by management to shield an employee from board scrutiny, said the people familiar with directors' views. "We have to decide on clear methods to stop this," said one of the people. "We may need to change the people in charge quickly. Whether we can remains to be seen."



Nissan has said it isn't shielding anyone from wrongdoing and planned to take necessary measures regarding any employee involved in Mr. Ghosn's alleged misconduct.



"The difficulty is that Nada hasn't been found to have done anything illegal," said one of the people familiar with the board's thinking. "But our argument is that this has become a huge issue for morale at Nissan."



Some Nissan employees have been sending complaints directly to the board out of concern that complaints sent through Nissan's internal whistleblower system were intercepted by management, said people familiar with the complaints. Nissan has said that it is misleading to say the complaints were intercepted.



Nissan's own general counsel hand delivered a letter to board members at the September meeting, because his concerns weren't making their way to the board through official channels.



At Tuesday's board meeting, the nomination committee plans to present its final list of candidates for the permanent CEO job.



"We want to clean up Nissan for the new management, or the new management will have to do it themselves," said another one of the people familiar with the board's thinking.



Write to Sean McLain at sean.mclain@wsj.com





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