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Nissan CEO told to go, COO appointed as interim chief

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Pressure has mounted on Hiroto Saikawa, given the company's poor peformance and its strained ties with Renault. Profits have tumbled to an 11-year low and prompted hefty job cuts.

Tokyo/Paris

NISSAN chief executive Hiroto Saikawa will step down next week, the company's board said on Monday, amid accusations of financial irregularities in the car-maker, which is still reeling from the arrest and ouster of its former boss Carlos Ghosn.

Yasushi Kimura, chair of the board of directors, told reporters: "After the board discussion, the board asked Mr Saikawa to step down from the CEO position. Mr Saikawa has accepted this."

The current chief operating officer, Yasuhiro Yamauchi, takes over as acting CEO on Sept 16, when Mr Saikawa officially leaves, added Mr Kimura.

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According to reports in the local media on Monday, Mr Saikawa is suspected of improperly adding 47 million yen (S$607,000) to his compensation by altering the terms of a bonus.

Another board member, Motoo Nagai, said that there was "no illegality" to what Mr Saikawa did, but that he should not have delegated elements of his pay to another executive.

"At the end of the day, the operation which should have been carried out by the president himself was carried out, delegated to others, which is a violation of the rules," said Mr Nagai.

Mr Saikawa apologised last week for the payment, while denying any wrongdoing.

"I left the issue to someone else so I had thought it was dealt with in an appropriate manner," he told reporters.

Meanwhile, moves are underway at Nissan to discuss his potential successors, said a source.

While Mr Saikawa had told some executives of his intention to step down, the timing of his departure was decided by the company's nomination committee, which is also discussing the shortlist of his potential successors.

Mr Saikawa admitted last week to being improperly overpaid and violating internal procedures. The admission, which followed an internal investigation, has pitched Nissan into fresh crisis and appears to have accelerated the search for a replacement.

His successor will inherit a company that has been battered by last year's arrest and subsequent ouster of Mr Ghosn. Ties with top shareholder Renault have been deeply strained, casting doubt on the future of the Franco-Japanese auto-making alliance.

The nomination committee, established in June to find a successor, is made up of six company outsiders, including Renault chairman Jean-Dominique Senard. It has drawn up a list of more than 10 possible candidates, an alliance source told Reuters.

Those on the list include Jun Seki, tasked with Nissan's performance recovery, chief competitive officer Yasuhiro Yamauchi and Makoto Uchida, chairman of Nissan's management committee in China, said the alliance source, who also spoke on condition of anonymity.

Mr Saikawa earlier told reporters that he wanted to "pass the baton" to the next generation as soon as possible, the Nikkei newspaper and other media outlets reported. He had previously made similar comments when asked about his future at the auto-maker.

Pressure has mounted on him, given the company's poor performance and strained ties with Renault. Profits have tumbled to an 11-year low and prompted hefty job cuts.

The search and vetting process would likely take about six months as the committee is considering both Japanese and non-Japanese candidates for the role, a third person with knowledge of the issue previously told Reuters.

For investors, a key question will be how Mr Saikawa's successor steers the alliance with Renault. AFP, REUTERS