Business / Corporate

Nissan panel to propose giving outside directors majority on its board

Kyodo

A Nissan Motor Co. governance committee will likely propose that outside directors make up a majority of the board in a bid to ensure more transparency following the arrest of former boss Carlos Ghosn, sources close to the matter said Saturday.

But the panel, which will draw up a report in late March, is not expected to delve into the responsibility of Nissan’s current executives, including new President Hiroto Saikawa, for the governance problems that led to alleged financial misconduct by Ghosn. The automaker’s ousted chief and savior has been detained in Japan since November, the sources said.

Nissan’s nine-member board only has three outside directors. By increasing the ratio of outside members, the panel is aiming to have them play a leading role in nominating executives and determining their remuneration, the sources said.

Ghosn has been charged with understating his remuneration for a number of years in Nissan’s securities reports and transferring derivatives losses from his private asset management company to the automaker.

Nissan, which brought the allegations to prosecutors following a whistleblower tip that emerged during reportedly contentious merger talks, has said it did not have enough checks on Ghosn’s power during his two-decade reign.

The committee is expected to make its proposals at Nissan’s board meeting in mid-April, according to the sources. It has also discussed Nissan’s cross-shareholdings with French partner Renault SA but will not make any proposal on the issue amid differing views among its members.

Renault holds a stake of more than 40 percent in Nissan while the automaker owns around 15 percent in Renault, a structure that some Nissan executives have seen as unfair.

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