Monday, September 25, 2023

Carlos Ghosn feared dismissal if Renault found out Nissan’s salary scale, court said

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Carlos Ghosn feared Renault would fire him if the true scale of his Nissan salary was disclosed, according to court testimony from the whistleblower that triggered the downfall of the former auto leader.

Your day, the former chief legal officer, appeared in public Thursday for the first time since Mr Ghosn’s arrest in 2018. He said fear of Renault’s reaction prompted Mr Ghosn to order staff to Nissan to concoct a ploy that would hide the full extent of total compensation which was the highest for a general manager of a Japanese company.

Thursday’s allegations emerged from what was to be the most explosive segment of the Tokyo trial of Greg Kelly, The former boss of Mr. Nada. Mr Kelly was arrested along with Mr Ghosn and is now fighting charges he helped cover up compensation from the former Nissan chief.

When asked why Mr Ghosn wanted to reduce his disclosed compensation, Mr Nada told the judges: “He did not want to be fired. If he paid himself what he wanted and it was disclosed, the French state would have felt compelled to fire him.

In addition to comments on Mr. Ghosn’s alleged motivation, Mr. Nada’s long-awaited testimony shed new light on the extent to which Nissan and Renault were planning to turn their alliance into a full merger.

Earlier accounts given to the Financial Times suggested that these talks did not get serious until about 2016. But Mr Nada said Mr Ghosn started planning for a merger from mid-2012.

The timing of merger negotiations is critical. Many believe that the threat of an impending merger that would have put Nissan at a disadvantage prompted senior officials to launch Mr Ghosn’s internal investigation in early 2018. This investigation ultimately led to his arrest by prosecutors and the downfall of the world’s most prominent automotive executive.

Mr Ghosn, who led the Renault-Nissan-Mitsubishi Alliance and escaped from Japan to Lebanon in late 2019, denied charges of 9.2 billion yen ($ 88 million) of under-reporting by deferred compensation that the former president was to receive over eight – one year period.

Nissan, which has also been accused of misstating Mr Ghosn’s compensation, declined to comment.

Mr. Nada’s explanation of events adds a new dimension to Mr. Ghosn’s alleged actions. In 2010, a rule change in Japan forced executives earning more than $ 1 million to disclose their salaries – a move that sparked fears of a major national backlash against Japan’s highest-paid CEOs.

Since the arrests of MM. Ghosn and Kelly, the role of their former colleague Mr Nada, 56, has been the center of growing speculation and mystery. The simple-mannered Anglo-Malaysian lawyer, who had worked for Nissan since 1990, was identified shortly after Mr Ghosn’s arrest as a central figure in the events leading up to this explosive moment, but his silence in the 26 months that followed was absolute.

Mr Nada, who said he advised Mr Kelly on how to reduce Mr Ghosn’s disclosed compensation, is also one of two former Nissan executives who signed a plea deal with Japanese prosecutors prior to the arrest of Mr. Ghosn.

As a result, people familiar with the situation said, Mr Nada spent months being questioned by prosecutors as they built their case against Mr Ghosn and Mr Kelly.


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