Renault Keeps Ghosn at Wheel After Probe Finds No Pay Wrongdoing

(Bloomberg) -- A Renault SA probe found that jailed Chief Executive Officer Carlos Ghosn’s compensation at the French carmaker complied with French law, sending another signal of division with its alliance partner Nissan Motor Co.

A preliminary review of the years 2015 to 2018 found nothing amiss on pay to the executive, who was indicted in Japan for understating his income, Renault said in a statement Thursday. The board opted to keep in place interim top management and not oust him, saying it doesn’t have information about Ghosn’s defense.

Renault also agreed to jointly investigate with Nissan their alliance’s Amsterdam-based holding company called RNBV, according to a person familiar with the matter. Lawyers are in talks to define the scope, the person said.

Renault’s latest findings stand in stark contrast to the unfolding events at Nissan. After a months-long investigation by the company, Ghosn was charged Monday for understating his income by $43 million. He has been removed as chairman of Nissan and alliance partner Mitsubishi Motors Corp., and remains in a Tokyo jail as Japanese prosecutors push ahead with a criminal investigation that has shaken the global car industry.

“The Nissan board made a unanimous decision regarding the misconduct of Mr. Ghosn and has offered to share that same information directly with the Renault board so they can make their own informed decision,” the Japanese automaker said in an emailed statement. “Nissan remains steadfast in its commitment to the Alliance and will continue to support its partners in the best interests of shareholders, customers and employees.”

Ghosn’s reported compensation totaled about $15 million annually, on average, during the five-year period through 2015 that has been investigated in Japan. That total includes what he was paid by Nissan and Renault.

While he’s less well paid than some of his global peers, Ghosn’s compensation has been a matter of controversy in France, where there is significant oversight of executive pay. In June, investors narrowly approved his package for 2017, despite opposition from the French government, Renault’s most important shareholder.

Renault’s board was briefed Thursday by the company’s lawyers on the reasons why Ghosn was charged, according to the statement. Renault had complained about being kept in the dark since the executive was arrested and the board requested that the carmaker’s lawyers continue to review and assess information provided by Nissan.

Meanwhile, Nissan’s external board members met Thursday but failed to reach an agreement on who will replace Ghosn as chairman at the Japanese company, a person familiar with the matter said. The external directors are set to meet again before next Monday’s board meeting, the person said. There is a possibility that Nissan’s board may not appoint a new chairman next week, as it is prioritizing setting up a governance committee, the person said.

--With assistance from Ma Jie.

To contact the reporter on this story: Ania Nussbaum in Paris at anussbaum5@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Tara Patel, Frank Connelly

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