The Monday turned out to be a dramatic twist for one of the prime names in the worldwide industry of automobile when the CEO of the auto industry got coverage in news. Local media reported that automaker Nissan indicted their chairman Carlos Ghosn and the position of chairman has been taken away from him.
Ghosn has been charged and got arrested in Tokyo when Whistle-Blowers notified authorities and had put Ghosan in the picture of his wrongdoings and claimed that he was using company’s finance for his own private expenditures and was under-reporting his revenue for quite a few years to Japanese pecuniary authorities.
The act of violating financial laws of Ghosn got other CEO’s in the vision of doubt also. In conjunction with Ghosan, the board director Greg Kelly was also indicted by Japanese prosecutors for misconduct the finance of a company. “The two men supposedly involved to under-report Ghosn’s revenue by concerning 5 billion yen ($44 million) over a five-year time ending in March 2015” state prosecutors.
Ghosn was positioned as the CEO in Nissan 2001 and then he smartly took the role of Renault CEO in 2005. The Greg Kelly was the board director. The news also influenced the condemn stocks of Nissan and Renault. Japan’s Mitsubishi Motors (MMTOF), Nissan and Renault mutually compose the largest global car making coalition, which formulates one of every nine cars sold in the region of the globe. The three companies pay more than 470,000 employees in nearly 200 countries.
“The Kelly and Ghosn must be taken their positions promptly, for violating the laws of finance” utters Hiroto Sikawa in a statement, who is Nissan’s, Chief Executive Officer.
After the stunning declaration got on the air, the people reacted indifferently and started discussing, criticizing Ghosan. A chairman emeritus of the Center for Automotive Research, Dr. David Cole has counseled many CEOs in the auto industry, said that the time has probably turned the table for Ghosn. “Ghosn turned the stones to hold a crown of the coach of a team. He has directed a composite multifaceted political trap of people and actions for approximately twenty years.”
“If he got to prison, it is going to astound the Renault-Nissan-Mitsubishi association as1 Ghosn was the crown of the association,” says Satoru Takada, an analyst at TIW, research and consulting firm based in Tokyo.
In a damning statement about Ghosn and Kelly Nissan stated that “on the basis of whistleblowers report, Nissan Motor Co., Ltd was conducting a cryptic internal investigation from the past few months on the subject of the misconduct and the deep involvement of the company’s Chairman Carlos Ghosn and Representative Director Greg Kelly. The investigation concluded that both the Kelly and Ghosn were compensating the company’s finance in Tokyo Stock Exchange. The observant reported that the amount submitted was less than the actual amount expected to be submitted, which means that the huge part of the amount was not being submitted and being used for other purposes. Other than this Ghosn’s involvement was also caught in using the company’s assets for personal use.”
It has also been noticed that Nissan had to discontinue manufacturing at all of its factories in Japan after it got identified that it had been misrepresenting productions and fuel economy tests.
Despite the fact that Ghosn’s business abilities are valued in Nissan, he altered the company’s image; re-built jobs and old factories which previous directors were not capable to do. But Ghosn did shoot his own foot and got himself marked as greedy. He fell from grace due to his poor decisions which took away his crown of ‘the idol CEO’. Although the top CEOs from around the world rewards with handsome retirement package and appreciation now Ghosn may end up with a criminal record and shame.
Rita shouts out to her ex-husband Carol Ghosn, by posting this message to social media “The hypocrite plays the role of hero with ethics and honorable values that he actually doesn’t acquire. But an elephant has two sets of teeth-one to show off and the other to chew with, at the back of closed doors they lie, cheat, abuses, criticize and disrespect.”
Nissan intensely makes an apology on the behalf of their CEO who got charged in the case of “misconduct of company assets” and for causing unease to their shareholders and stakeholders. Nissan will continue to keep a sharp eye on governance and compliance issues. Now the fate of Gohsn is in the hands of Japanese lawmakers and law enforcement, Japanese Public Prosecutors Office has been fully cooperating with its investigation.