PARIS -- Renault-Nissan has no current plans to introduce an additional bonus scheme for executives at the carmaking alliance, CEO Carlos Ghosn said on Thursday.
Ghosn made the comments at Renault's annual shareholder meeting after Reuters reported that alliance bankers had drawn up plans designed to channel millions of euros in extra, undisclosed bonuses to Ghosn and other managers via a specially created service company.
"This is the document of a consultant who came to make a certain number of proposals," Ghosn said. "We are open to proposals, but that doesn't mean when we listen to an idea that we are going to put it into practice."
The incentive plan proposal has not been put to the Renault board or executive committee, Ghosn said, adding that no decision was expected any time soon on such a scheme.
The preliminary proposal drew criticism from some investors already concerned about compensation, governance issues and an ongoing French criminal probe into allegations of systematic Renault diesel emissions fraud. The company has denied any wrongdoing.
"Such a scheme would bypass the Renault and Nissan shareholders," Dieter Waizenegger, head of the activist CtW Investment Group, told Le Monde newspaper ahead of the meeting. "It violates every principle of transparency."
Under the incentive plan proposal reported by Reuters, the alliance partners and Nissan-controlled Mitsubishi would pay a share of synergies into an independent Dutch-registered company for redistribution to their executives, with one-third reserved for Ghosn and a few top managers.
The arrangement would avoid any legal obligation to disclose the compensation to shareholders, according to the presentation by investment banking firm Ardea Partners. Ardea was founded last year by Christopher Cole, a former Goldman Sachs co-chairman and a trusted Ghosn adviser, who has worked for him on past deal studies.
Renault shareholders approved Ghosn's 7.06 million euro ($7.87 million) CEO salary in a narrow 53-47 vote on Thursday, a year after their rejection of his 2015 payout forced a 20 percent variable-pay cut.
Ghosn also received a similar package as Nissan CEO, a role he relinquished in April as he prepares to hand over operational leadership of the alliance, while likely staying on in one or more chairman roles.
Ghosn, who has led Renault since 2005, had good news to announce at the meeting. Renault's group revenues rose by 13 percent in 2016 to 51.24 billion euros, and operating margin was 6.4 percent versus 5.2 percent in 2015. Earnings per share and dividends were both up.
Renault's global vehicle sales increased by 13.3 percent, to nearly 3.2 million; in Europe the gain was nearly 12 percent. The Renault brand replaced Ford as the second largest in Europe by unit sales after the Volkswagen marque at No. 1.
The results may be more difficult to achieve in 2017, with the overall European market predicted to be well below 2016 figures. Renault has also fully consolidated its money-losing Russian subsidiary AvtoVAZ, which makes Lada cars, into its balance sheet. Ghosn has said he expects AvtoVAZ to be profitable by 2018.
Under the structure of the Renault-Nissan alliance, now 18 years old, Renault holds a 43 percent share in Nissan, while the Japanese carmaker holds 15 percent of Renault.
Despite winning the backing of shareholders on Thursday, Ghosn, who is chairman of Nissan and Mitsubishi, faces challenges.
France's new president, Emmanuel Macron is an old adversary of Ghosn. The French government, which is Renault's biggest shareholder, may seek to rein in the CEO.
In his previous post as France's finance minister, Macron was critical of Ghosn’s CEO pay and also pushed the government to increase its stake in Renault to nearly 20 percent to give it more say in the automaker. Ghosn says any further integration of the alliance is off the table unless that stake is sold.
Macron has criticized Renault’s “dysfunctional governance” and urged the company to reconsider Ghosn’s compensation.
Activist investors have asked French market watchdog to investigate the alliance’s governance structure. They claim Renault failed to adequately inform shareholders about a transfer of decision making to Renault-Nissan BV, the Dutch-registered joint venture that oversees areas of alliance activities. They also suggest that Ghosn’s many posts within the alliance create conflicts of interest.
French investigators are probing allegations that Renault used a “fraudulent” device that modified engine operation to reduce NOx emissions under specific testing conditions. Volkswagen and Fiat Chrysler are also facing the same judicial scrutiny in France. Ghosn has said repeatedly that Renault cars comply with European emissions regulations.
Ghosn, 63, may be preparing for his succession at the alliance. Reuters reported last week that he is searching for a chief operations officer, a position that would supersede the separate chief competitiveness officer posts at Nissan and Renault.
Peter Sigal contributed to this report