Monday 9 September 2019 2:40 pm

Nissan crisis: Chief resigns after year of scandal and financial turmoil

The crisis at Japanese automotive giant Nissan deepened today, after chief executive Hiroto Saikawa was asked to quit by the company’s board.

In a sometimes heated late night press conference in Japan, board members confirmed that Saikawa, who had already expressed a desire to leave the top job, would step down. 

Read more: Nissan chief ‘tells executives he plans to resign’ after torrid year

The announcement comes days after Saikawa admitted that he had received payments that flouted company rules – but were not illegal – via a scheme designed by disgraced former chairman Carlos Ghosn, who faces criminal charges in Tokyo for financial misconduct.

Saikawa has overseen a period tarnished with financial failure, corporate scandal and job cuts since he took the job in 2017. Today, he apologised to stakeholders that he had to go “while things are yet to be done” to turn things around.

Nissan’s change at the top came as it wrapped up a 10-month internal probe into the finances of Ghosn, who denies his charges after being arrest in November 2018.

The board said Saikawa had received payments via Ghosn’s stock appreciation rights (SAR) scheme, but that his involvement had been unintentional. However, they added, the probe into the scheme “was left in the hands of others” when it should have been carried out by Saikawa himself.

They also cited Nissan’s poor financial performance of late as a reason for Saikawa’s ousting. In July, Nissan reported a 98.5 per cent plunge in operating profit in the first quarter of 2019, and announced it was slashing 12,000 jobs across the globe.

Finding a replacement

The firm said it would install chief operating officer Yasuhiro Yamuchi as interim chief executive, but that it hopes to find a permanent replacement by the end of October.

Nissan external director and member of the board Masakazu Toyoda told journalists the firm had worked up a long list of 10 potential replacements that included women, non-Japanese candidates, and people who did not work at the company.

He said the appointment would be made on “a fairly quick schedule”.

Read more: Nissan boss admits overpayment as boardroom scandal roars back into life

“There isn’t much time available to us, but we believe this will translate to improved governance,” he said.

Toyoda also revealed the company had been sounding out potential replacements as early as July.