Shareholders criticize Nissan over Carlos Ghosn scandal

TOKYO — Nearly three years after his arrest and removal, Nissan's former Chairman Carlos Ghosn dominated the talk at the automaker's annual shareholders meeting, with attendees savaging management over issues ranging from the company's handling of his ouster to its slumping performance without him.

At last week's gathering, angry shareholders — who saw Nissan's share price fall by as much as two-thirds in the wake of Ghosn's departure — blasted current CEO Makoto Uchida and the rest of the board with a range of complaints.

One shareholder said it was obvious Ghosn was the victim of a corporate coup and accused Nissan of whitewashing the matter. Allegations of Ghosn's misconduct, the attendee said, should have been handled internally by the board, not trotted out to prosecutors as a criminal matter.

Another shareholder demanded that Nissan be more forthcoming with evidence of misconduct against Ghosn in its ongoing civil suit, which seeks $100 million in damages from Ghosn. That complaint echoed a similar demand from Ghosn's lawyer, who claims Nissan is refusing to share all the facts.

One attendee waxed nostalgic for the era of Renault- Nissan-Mitsubishi alliance amity, before Ghosn was arrested in Japan with his accused accomplice, former director Greg Kelly, in November 2018. The year before that, Nissan and its alliance partners had been the world's largest automotive group, the shareholder noted.

Workers at Nissan swelled with pride at the achievement, he said. Where was such pride now?

"Under Ghosn's leadership, there were lots of good things," the shareholder lamented. "You had an ambition to be the world's biggest automaker together with the alliance. People were motivated. This is my question to all of you: Do you have self-confidence and pride?"

Other shareholders accused Nissan of not sufficiently overhauling its corporate governance in the wake of the Ghosn scandal. And more blasted management for racking up two years of financial losses following Ghosn's departure and presiding over an implosion of shareholder value.

The barrage of vitriol during the question-and-answer session underscored how the scandal continues to cast a shadow on Nissan, even after Ghosn fled Japan in December 2019 to avoid criminal prosecution. Uchida tried to keep the proceedings focused on his "Nissan Next" midterm revival plan.

"We are working very hard to avoid a net loss for three years in a row," he said. "Please be patient with us. Once again we will make Nissan shine."

But the subject kept swinging back to Ghosn. And even Kelly — who is on trial in Tokyo, accused of enabling Ghosn to conceal millions of dollars worth of postponed compensation from the public — received a shoutout in the shareholder meeting.

One stockholder implored Uchida not to pursue an appeal against Kelly if he is cleared as not guilty by the Tokyo District Court. Unlike in the U.S., Japanese prosecutors can appeal not-guilty verdicts, thereby ensuring lengthy legal quagmires for defendants.

The shareholder said that letting Kelly return to his home in the U.S. afterward would show respect for human rights.

"This is a great opportunity to restore the image of the company," the person said. Kelly maintains his innocence, but a verdict isn't expected until late this year or early 2022.

The meeting's official agenda called for the reelection of all 12 Nissan directors. But even that business proved contentious. One shareholder proclaimed he would vote down any director who was on the board at the time of Ghosn's arrest, in protest of the way the board handled his dismissal.

Uchida denied that Ghosn was the victim of a plot, which Ghosn himself maintains, to prevent him from merging Nissan with Renault.

"There is no fact to this so-called conspiracy theory," Uchida said.

Meanwhile, director Motoo Nagai, head of Nissan's audit committee, was forced to address a report that appeared on Japanese TV that suggested a conspiracy by airing a purported internal email that implied foul play. Nagai dismissed it as a falsified email circulated by "Ghosn's camp."

The only other item for up for a shareholder vote was a proposal to disclose the contents of the business agreement underpinning Nissan's alliance with Renault.

Details of that accord, called the Restated Alliance Master Agreement, have never been officially disclosed.

Supporters of the proposal argued that greater transparency is needed to protect Nissan's smaller investors, who feel disadvantaged in the face of Renault's controlling 44 percent share.

The proposal's backers submitted their written assertion that the agreement has left Nissan's shareholders "not on an equal footing" and "economically disadvantaged," and they claim the disadvantage will continue as long as the revised agreement's pros and cons are not widely known.

Nissan management responded that the revised master agreement binds Nissan to confidentiality, and the proposition was summarily rejected in a floor vote.