Date
20 September 2019
Nissan Motor CEO Hiroto Saikawa expressed regret for his failure to turn around the automaker. Photo: Reuters
Nissan Motor CEO Hiroto Saikawa expressed regret for his failure to turn around the automaker. Photo: Reuters

Nissan CEO Saikawa to step down on Sept 16

Nissan Motor chief executive Hiroto Saikawa will resign on Sept. 16, bowing to pressure after he admitted to being improperly overpaid and marking further upheaval at a company battered by scandal and plunging profits, Reuters reports.

Saikawa, who admitted to the overpayment of around US$440,000 last week, will be temporarily replaced by chief operating officer Yasuhiro Yamauchi, with a permanent replacement expected by the end of October, Japan’s second-largest automaker said.

His sudden resignation, which comes before a long-term succession plan has been decided, marks a dramatic exit for a man who had been tasked with righting the automaker following the arrest and ouster of former chairman Carlos Ghosn last year on charges of financial misconduct, which Ghosn denies.

Saikawa, a protégé of Ghosn, took over as Nissan CEO from his mentor in 2017, leaving Ghosn as chairman. His brief tenure has been characterized by strain with top shareholder Renault SA and tumbling profits. Nissan’s shares have lost almost a quarter of their value this year.

“Saikawa recently has indicated his inclination to resign, and in line with his desire to pass the baton to a new generation of leaders at Nissan, he will resign on Sept. 16,” Nissan’s chairman of the board, Yasushi Kimura, told a news conference on Monday.

Among the candidates to lead the maker of the Rogue SUV crossover and the Leaf all-battery electric car are non-Japanese, women, and those hailing from Renault, the chairman of Nissan’s nomination committee, Masakazu Toyoda, told reporters.

Addressing reporters alone at the end of a late-night news conference, the 65-year-old Saikawa expressed regret for his failure to turn around the firm which he has said had long chased market share at all costs under Ghosn’s tenure, undermining profitability.

“I had hoped to solve all of these issues before stepping down,” he said, referring to the automaker’s problems. “But I haven’t been able to, and for that I apologize.”

Stoic and contrite, Saikawa also took aim at his former mentor, saying he hoped that Ghosn and former director Greg Kelly felt regret for Nissan’s current situation resulting from their financial misconduct. Kelly also denies any wrongdoing, as both await separate trials in Japan.

Saikawa said he would return the improper compensation, having conceded he was wrong to appoint a separate team led by Kelly to manage his share-based salary incentive scheme. An internal investigation found that the procedure violated company rules, although it was not illegal.

While Saikawa has said he did not intend to break the rules, his admission of overpayment has pitched Nissan into fresh crisis and appears to have accelerated the push for a replacement.

The nomination committee, established in June to find a successor, was now speeding up its search to find a successor from a list containing around 10 possible candidates. The committee is made up of six company outsiders, including Renault chairman Jean-Dominique Senard.

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