Business / Corporate

New Nissan CEO vows to improve corporate culture after Ghosn's rule

Kyodo

New Nissan Motor Co. CEO Makoto Uchida vowed Friday to improve the automaker’s corporate culture following the two-decade rule of former chairman Carlos Ghosn, who was arrested and ousted over financial misconduct allegations last year.

“I will be committed (to my job) with the focus on regaining trust and recovering business performance,” Uchida said in a group interview after assuming the post Dec. 1 as part of a leadership revamp aimed at restoring the company’s battered earnings and improving governance.

Uchida said it was important to create an atmosphere where employees could hold discussions openly.

The external committee of Nissan, set up to bolster corporate governance, concluded in March that concentration of authority in Ghosn had led him to commit his alleged misdeeds and has highlighted Nissan’s corporate culture “in which no one can make any objections to” Ghosn.

The new CEO also said Nissan would strengthen its alliance with Renault SA and Mitsubishi Motors Corp., showing confidence that synergies from the three-way partnership would give his company a competitive edge over rival automakers.

“We have friendly relationships where we respect each other and generate profits,” said Uchida.

The former senior vice president in charge of China operations has worked for Renault in South Korea and on purchasing at Nissan in cooperation with the French carmaker.

Hit by slumping global sales, Nissan predicts net profit will hit a 10-year low of ¥110 billion ($1 billion) and that operating profit will fall to an 11-year low of ¥150 billion in the current business year through next March. In May, Nissan revised downward its sales target in its medium-term business plan, in a break from Ghosn’s expansionary policy, and pledged to review sales policy in its main U.S. market, where the company’s heavy reliance on incentives to sell cars dented profitability and hurt brand perception.

In July, the firm also announced restructuring steps, including 12,500 job cuts and closures of unprofitable plants over the next three years.

“The foundation to overcome important challenges has already been laid. My role is to realize it,” Uchida said.

Uchida assumed leadership after Hiroto Saikawa, a close lieutenant of Ghosn, resigned as CEO in September, admitting he was overpaid by an equity-linked remuneration scheme run by the company.

The automaker has been undergoing a drastic management overhaul since the Ghosn scandal, hiring more outside directors as new board members and setting up committees to oversee the nomination of executives, remuneration and audits.

Ghosn faces trial in Japan on charges of underreporting remuneration and aggravated breaches of trust at Nissan. He denies the allegations.