Carlos Ghosh had too much power, says Nissan committee

A Nissan committee set up to strengthen corporate governance after the arrest of former Chairman Carlos Ghosn says it found he had too much power and recommended that the scandal-hit Japanese automaker add more independent outside directors to its board and better oversee compensation and auditing, the Associated Press reported.

The governance committee said it concluded that the “root cause of the misconduct was the concentration of all authority in Mr. Ghosn.”

The committee’s findings underline Nissan’s efforts to distance itself from Ghosn’s upcoming criminal trial.

Ghosn, who led Nissan for two decades and rescued it from near-bankruptcy, says he is innocent. He has been charged with falsifying financial reports and breach of trust.

Seiichiro Nishioka, a former judge and the co-chair of the governance committee, said the investigation found the problems were caused by what he called misconduct by an individual manager involving pursuit of personal gain, and were basically different from past wrongdoing at some other Japanese companies, such as accounting fraud.

The post of chairman at Nissan, which had been held by Ghosn, will be abolished, according to the committee’s proposals.

“The facts show there were governance problems at Nissan,” Nishioka told reporters, stressing that checks and balances needed to detect the wrongdoing were missing.

A group to monitor compensation will be made up of all outside independent directors, while groups to oversee director appointments and auditing will consist mostly of outside independent directors.

Nissan Chief Executive Hiroto Saikawa has denounced Ghosn as the “mastermind” of what he called professional financial misconduct, while declining comment on the criminal trial proceedings.