Amid Controversy of being Overpaid, Nissan CEO Hiroto Saikawa to Resign

Amid Controversy of being Overpaid, Nissan CEO Hiroto Saikawa to Resign 

Japanese auto giant Nissan, is soon going to lose its CEO Hiroto Saikawa. Amidst the ongoing turmoil that the firm is dealing with, the news of Nissan CEO resigning makes the shareholders raise questions about the firm’s future.

The decision of Nissan CEO to resign is said to “pass the baton” to a new generation of executives. Saikawa says he has already informed his colleagues about his intention to step down.

Nissan is still trying hard to cope with the loss of reputation over the arrest of its former chairman Carlos Ghosn last year. Ghosn, who strongly held the position of chief executive officer of Nissan for nearly two decades, had been accused of transferring personal investment losses to the firm. It is said that he was underreporting his salary by tens of millions of dollars.

In a magazine interview held in June, former Nissan executive, Greg Kelly said that to receive an additional 47m yen (£358,000), Saikawa manipulated the date of execution of his stock appreciation right.

As of now, the details of the payments have not been revealed. Even though the Nissan CEO denied any wrong doing, he apologised last week. Speaking to the reporters while denying the request of extra cash he said, “I left the issue to someone else so I had thought it was dealt with in an appropriate manner”.

Confirming the news of overpayment, Saikawa agreed that he had been overpaid by tens of millions of yen under an incentive scheme that gives bonuses to directors if the company’s share price goes well in the market.

Apart from Saikawa, Hari Nada, Senior Vice President of Nissan, is also reported to be overpaid.

In order to ensure a smooth replacement of the Nissan CEO, its nominating committee has already drawn up a shortlist of more than 10 possible candidates.

Back in June, the shareholders of Nissan had voted in support of various measures like the establishment of three new oversight committees in order to appoint senior officials, pay issues and auditing. They approved the election of 11 directors as the firm restructures, including two Renault executives and Saikawa.

As per the senior management, Yuasuhiro Yamauchi would be serving as the interim CEO till the board sets a timeline for a permanent successor.

Former Nissan CEO, Ghosn is currently on bail and is yet to face trial in Tokyo next year.

Saikawa was reappointed in June with the support of Renault. Citing close connection between Ghosn and Saikawa, investor groups including Institutional Shareholder Services and Glass Lewis had voted against him.

Apart from the Nissan CEO, Nissan’s vice president Christina Murray is all set to leave the firm on September 10.

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