You are here

Nissan vows to mend Renault alliance as new board is voted in

BT_20190626_SMLNISSAN26_3818273.jpg
At Nissan's annual meeting in Yokohama, shareholders approved a governance structure designed to boost oversight and prevent the concentration of corporate power in one individual.

Tokyo

NISSAN Motor Co pledged to put more focus on mending its troubled two-decade alliance with Renault SA as the Japanese carmaker's shareholders voted to give the French partner more say over its future.

At Nissan's annual meeting in Yokohama, shareholders approved a governance structure designed to boost oversight and prevent the concentration of corporate power in one individual, seeking to address the lapses that led to the arrest of former chairman Carlos Ghosn.

Renault, which owns 43 per cent of Nissan, got a bigger representation in key board committees.

sentifi.com

Market voices on:

Chief executive officer Hiroto Saikawa, who got his position reaffirmed though he hinted at a potential exit in the future, emphasised the Renault alliance's value and signalled that Nissan will speed up talks to strengthen it. That's a change of stance from the past few months, when Nissan insisted that getting its own internal business in order was a top priority.

"Postponing the talks could result in speculation and undermine the alliance's day-to-day operations and affect Nissan's recovery efforts," Mr Saikawa said. "It is critical to create opportunities with Renault to discuss our future relationship while we continue to improve our performance."

Ghosn's arrest late last year fractured the carmakers' partnership, and Nissan's failure to support a proposed merger between Renault and Fiat Chrysler Automobiles NV this month put more strain on the pact.

Mr Saikawa reiterated that he isn't in favour of a merger between Nissan and Renault, and said an "imbalance" in the companies' cross-shareholdings needs to be addressed - Nissan only owns 15 per cent of its French partner. "Having an alliance definitely increases our competitiveness, and the challenge is how to define the alliance," Mr Saikawa added.

Shareholders approved creating three board committees: nomination, audit and compensation. Renault CEO Thierry Bollore will be on the audit committee and Renault chairman Jean-Dominique Senard on the nomination committee - key positions at the heart of decision-making. The nomination committee will be overseen by Masakazu Toyoda, the lead, independent outside director.

A majority of the new board isn't affiliated with Nissan, with new directors including the chairman of Nihon Michelin Tire Co and the former head of Sony Interactive Entertainment.

Yasushi Kimura, an adviser to oil company JXTG Holdings Inc, will be chairman and Mr Senard will be vice chairman. Outgoing directors include Nissan veteran Toshiyuki Shiga, who once was Ghosn's right-hand man.

With fewer Nissan insiders, the new board potentially could take a more benign view on any attempt by Renault to resume deal talks with Fiat. The European carmakers' talks ended in early June after a last-minute intervention by the French government, which suggested the deal was being rushed and that more time was needed to gain Nissan's approval.

Mr Senard, speaking at the Nissan shareholder meeting, said a deal between Fiat and Renault would also have been beneficial for Nissan. There was "no aggression against Nissan", he noted.

Mr Saikawa, Ghosn's protege-turned-accuser, held on to his job thanks to Renault's support. He faced shareholder criticism for not reacting to Ghosn's alleged wrongdoing early on, with some calling for his resignation at Tuesday's event.

The 65-year-old CEO said he isn't in a position to say when a successor will be named for him, but wants the nomination committee to speed up a search for one. BLOOMBERG