Business / Corporate

Nissan to cancel Carlos Ghosn's retirement and stock-linked compensation benefits

Bloomberg

In the latest steps by the Japanese automaker to distance itself from its former chairman, Nissan Motor Co. is canceling yet-to-be-paid compensation benefits for Carlos Ghosn.

Ghosn, who was arrested in November on charges of financial misconduct, will no longer receive unpaid retirement benefits of ¥4.44 billion ($41 million), Nissan disclosed in a stock filing Thursday.

A ¥2.27 billion share-price-linked plan, called stock appreciation rights, is also being canceled, Nissan said.

Compensation is a key issue in the allegations against Ghosn, whose arrest destabilized the auto alliance he created between Nissan, Renault SA and Mitsubishi Motors Corp.

Ghosn has denied all charges against him, and has argued that he acted appropriately by not including deferred compensation in regulatory filings.

Ghosn’s total compensation reached ¥1.65 billion in the latest fiscal year, which ended March 31, including ¥410 million already paid and ¥1.24 billion set to be deferred until his retirement, according to Nissan’s filing.

Hiroto Saikawa, Nissan’s chief executive officer, received ¥404 million in compensation after taking a pay cut over inspection issues at the company’s plants in Japan and the Ghosn scandal.

The CEO has said he will return half of his compensation in the April-June period, while a newly established remuneration committee will decide his compensation for the rest of the current fiscal year.

This week, Nissan shareholders approved creating three board committees for nomination, audit and compensation. The governance structure is designed to boost oversight and prevent the concentration of corporate power in one individual, seeking to address the lapses that led to Ghosn’s arrest.