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Ghosn Gone: Nissan Fires Chairman After Arrest

Carlos Ghosn was arrested on Monday, 19 November, for alleged financial improprieties.

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Nissan Motor Co fired Carlos Ghosn as chairman on Thursday, 22 November, curtailing the powerful executive’s nearly two-decade-long reign at the Japanese automaker after his arrest for alleged financial improprieties.

In an hours-long meeting, the company’s board of directors voted unanimously to dismiss Ghosn as chairman and as a representative director, Nissan said in a statement. It said its own internal investigation, prompted by a whistleblower, found serious misconduct including under-reporting of his income and misuse of company assets.

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It was a stunning downfall for one of the biggest figures in the auto industry, a man who helped drive turnarounds at both France’s Renault SA and at Nissan and then managed an alliance between them that sold 10.6 million cars last year, besting its rivals.

Nissan said in a statement filed to the Tokyo Stock Exchange that its investigation uncovered misuse of company investment funds and expense money for personal gain.

The Japanese broadcaster NHK said Ghosn was arrested on Monday, 19 November, after he voluntarily submitted to questioning by Tokyo prosecutors.
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The Yokohama-based company, one of the world's largest automakers, said the violations were discovered during an investigation over several months that was instigated by a whistleblower. Ghosn, 64, also allegedly engaged in personal use of company assets, it said.

Nissan said it was providing information to the prosecutors and cooperating with their investigation. The allegations also concern a Nissan representative director, Greg Kelly, it said.

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Nissan's CEO Hiroto Saikawa planned to propose to its board that Ghosn and Kelly both be removed from their posts, the company said in a statement.

"Nissan deeply apologises 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," it said.

The Nissan-Renault-Mitsubishi group is among the biggest auto alliances in the world, selling about 10 million vehicles a year. Before joining Renault, Ghosn worked for Michelin North America.
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Shares in Renault SA of France plunged 14 percent early on Monday. The news of Ghosn's troubles broke after Japanese markets had closed for the day.

The allegations are a serious blow at a time when Nissan and Mitsubishi Motor Co are still overcoming scandals over their quality testing reporting.

Who is Carlos Ghosn?

Ghosn is credited with helping engineer a remarkable turnaround at Nissan over the past two decades, resuscitating the Japanese automaker from near bankruptcy after he was sent in by Renault.

He served as Nissan's chief executive from 2001 until April 2017, becoming chief executive of Renault in 2005, leading the two major automakers simultaneously. In 2016, Ghosn became Mitsubishi Motors' chairman.

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For the past two decades, he has maintained an unusually high profile in a nation where foreign chief executives of major Japanese companies are still relatively rare.

Ghosn has appeared on magazine covers dressed in a kimono, vowing to renew the Nissan brand. He was widely praised in Japanese industry circles for delivering sorely needed cost cuts and introducing greater efficiency at a time when Nissan needed a fresh start.

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Topics:  Nissan   Renault 

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