Renault defends Ghosn, who will remain CEO

Renault defends Ghosn, who will remain CEO

CEO Renault Nissan Carlos Ghosn in press conference for the new Renault Espace at the the Paris motor show.

Carlos Ghosn will remain the Renault chairman and chief executive, despite his arrest in Tokyo. 

Whilst Ghosn was fired from Nissan, Renault has confirmed that he will remain the car manufacturer’s boss despite financial misconduct.

An internal investigation revealed “significant acts of misconduct” including “personal use of company assets”.

To temporarily replace Ghosn will be Thierry Bolloré, who has been promoted whilst the Ghosn will be “temporarily incapacitated”.

“At this stage, the board is unable to comment on the evidence seemingly gathered against Mr Ghosn by Nissan and the Japanese judicial authorities,” said Renault on Tuesday evening.

Bolloré said in a memo to staff that the arrested CEO had “full support” of the group’s executives.

The news of Ghosn’s arrest has sent shockwaves through the industry. Shares in Nissan (TYO: 7201) and Renault (EPA: RNO) plunged on Tuesday.

Shares in Nissan fell 5.5%, its lowest level since July 2016, whilst Mitsubishi Motors fell by 6.9%. Renault’s share price fell 3.3% this morning in Paris, adding to Monday’s 8% fall.

Nissan’s chief executive Hiroto Saikawa said this week: “too much authority was given to one person in terms of governance”.

“I have to say that this is a dark side of the Ghosn era which lasted for a long time,” he said, adding he was still debating whether Mr Ghosn was “a charismatic figure or a tyrant”.

France has a 15% stake in Renault and has commented on the arrest. The French Finance Minister, Bruno Le Maire, has said that Ghosn is “no longer in a position” to lead the carmaker.

Ghosn was the first person to lead two Fortune 500 companies at the same time.

The Financial Times has reported that the arrested boss was planning a merger between both Renault and Nissan. The Japanese company was opposed to the proposed deal.