Wednesday 12 June 2019 12:39 pm

Vote against Nissan chief executive Hiroto Saikawa at upcoming AGM, say proxy shareholders

Pressure is mounting on Nissan chief executive Hiroto Saikawa ahead of a vote on his re-election as a director at the firm later this month.

Two of the world’s largest proxy voter services, ISS and Glass Lewis, have recommended shareholders do not retain him at the helm of the Japanese car maker.

Read more: Nissan forecasts worst earnings in 11 years

Saikawa took the wheel after former boss Carlos Ghosn was arrested for alleged financial misconduct. It is believed he is likely to win the support of Renault, which controls 43 per cent of voting rights. But the proxy recommendations suggest he will lose the majority of remaining shareholders’ votes.

He requires at least half of voting shareholders’ support at the annual general meeting of the car firm on 25 June.

Concerns centre around the fact Saikawa served on the board for 14 years and was close to disgraced Ghosn. He signed off on Ghosn’s retirement package, which forms part of the basis for allegations against him. This throws into doubt Nissan’s argument that it is “only a victim” in the case.

“In order to break from the past, the company needs to build a strong board with fresh members. Given the fact that Mr Saikawa has been on the board for 14 years, and worked closely with Ghosn, Saikawa’s appointment to the board is not considered appropriate,” said the note.

Read more: Nissan slashes profit forecast

Glass Lewis said Saikawa should have “taken greater steps in performing its [Nissan’s] oversight responsibilities in the misconduct of the board members”.

The Ghosn scandal has opened up fault lines in the relationship between Nissan and French partner Renault. Saikawa had hoped to improve corporate governance by introducing a new board structure made of three committees, but Renault intends to block the move.