Former Renault-Nissan chief is to lose €30m in pay and shares as his lawyer quits

This article is more than 1 year old

This article is more than 1 year old

Renault’s board of directors has voted unanimously to strip former boss Carlos Ghosn of up to €30m (£26m) in pay and severance.

Renault issued a statement on Wednesday saying its board had agreed to waive Ghosn’s non-compete clause and as a result the company would not be paying the compensation linked to this agreement. The move has the backing of the French government.

This amounted to two years pay, worth €4-5m, plus about 460,000 performance shares worth up to €26m that were due to Ghosn, two people familiar with the matter told Reuters on Wednesday.

“With respect to the shares granted to Mr Ghosn in 2015, 2016, 2017 and 2018 as chairman and chief executive office, both as part of the deferred portion of his variable compensation for the financial years 2014 to 2017, as well as the performance share plans for the years 2015 to 2018, their definitive acquisition is subject to his presence within Renault,” the company said.

“The board unanimously notes that such condition is not met, thereby triggering the loss of Mr Ghosn’s rights to the definitive acquisition of such shares.”

Ghosn was forced out of the company in January following his arrest in Japan for suspected financial misconduct at Nissan, Renault’s alliance partner.

The executive enjoyed semi-legendary status in the automotive industry until he was arrested in November and charged with falsifying financial reports by under-reporting his compensation, and breach of trust.

Ghosn, whose arrest has prompted concern about the strain placed on the groundbreaking Renault-Nissan alliance, has repeatedly said he is innocent.

If his golden parachute had been allowed to stand, it could prove politically explosive in Renault’s home country, where France’s president, Emmanuel Macron, is battling “yellow vest” street protests over low pay and inequality.

The finance minister, Bruno Le Maire, had asked the government’s lead board representative at Renault to “ensure that Mr Ghosn’s compensation is cut as much as possible”, a ministry official said.

“We’ve always been against excessive pay,” the official said. “It’s not about the presumption of innocence but ethics and decency.”

Renault, which appointed Jean-Dominique Senard as its new chairman last month, has since passed evidence to prosecutors that the company paid part of Ghosn’s 2016 Versailles wedding costs.

Representatives of Ghosn, who has claimed that fellow executives were plotting to oust him, say he was unaware the €50,000 rental had been charged to Renault and now plans to repay it.

On the same day as his pay deal came under threat, Ghosn’s legal battle took a fresh twist with the resignation of Motonari Otsuru, the lawyer heading his defence.

Otsuru’s office and a statement submitted to the court confirmed that Otsuru had quit on Wednesday.

It was unclear why he was no longer representing Ghosn. Another attorney chosen to represent the 64-year-old also resigned as of Wednesday.

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Japanese media said Junichiro Hironaka has been hired to defend Ghosn but the lawyer’s office declined to comment.

Otsuru is a former star Tokyo prosecutor. However, he and Ghosn seemed to be at odds over his defence, with Ghosn strongly asserting his innocence from the start through his own statements, as well as those of his other lawyers, family members and representatives.

Ghosn has tried without success to gain release on bail, offering to wear an electronic monitoring tag.