If you have read Michael Woodford's book 'Exposure' on his ousting as CEO of Olympus, you might suspect that there could be more to this situation than meets the eye. Corporate Japan has rejected foreigners before, and Ghosn has upset a lot of keiretsu members over the years.
3
Something about this story doesn't "add up", no pun intended.
Never heard of this guy, but it's just hard to fathom how an executive of this man's stature and acumen could believe that he would be able to successfully "underreport" his corporate compensation to a governmental agency.
In the U.S.A, as most of us here I would assume know, wages and compensation are automatically reported to the I.R.S. So if the taxpayer doesn't report the same figure(s) eventually you will get a love letter from IRS asking you to explain the discrepancy or pay additional tax.
I know nothing about how Japan collects this information, but it's unfathomable that a high profile, highly compensated man like this could believe he would be able to hide income like this successfully.
This is not the typical type of tax avoidance scheme we hear about in this country, where capital is "parked" in offshore accounts and income earned is simply not reported to IRS.
There has to be much more to this story that what has been reported so far.
What he did, if that's all he did, is just plain stupid, and clearly this is not a stupid man.
3
Ahhh... The absurdly Byzantine politics of Japanese business.
The under-reporting of Ghosn's salary as CEO of Nissan.
In Japan, that's a HUGE offense and he's being held without bail, much like a Yakuza.
Ghosn arrived at Nissan in 1999, and saved the company from financial collapse.
The alliance that Ghosn created between Nissan and Renault made it the world’s largest automobile manufacturer.
His arrest ultimately threatens the finely tuned global alliance of Renault, Nissan, Mitsubishi, and all 3 may eventually collapse in the years ahead, w/o his iron-fisted leadership.
There is no question that he committed financial crimes, but of what magnitude? Just how politically motivated is his arrest, and what global entities profit from it?
Regardless, it's obvious that he REALLY angered someone influential in Japan, maybe even decades ago.
3
Some "hero" Mr. Ghosn turned out to be! I feel really bad for the Japanese people as they do not tolerate embarrassment well. To think they paid Mr. Ghosn over a billion dollars in 2016 is incredible despite the fact that it appears that Ghosn had planned to bilk their government of even more money before 2020 was up. I don't blame French president Macron for wanting Ghosn's exorbitant salary cut in light of how expensive it was, and hopefully those 47,000 French workers will still remain employed long after Ghosn ends up in prison. The Japanese treated him like a king and this is how he repays their generosity? Will Japan keep him there or will he try to return to the States to serve his long sentence? Enquiring minds want to know.
@MadasHelinVA
He was paid one billion yen ($10 million), not one billion dollars. Moot point but just to clarify.
4
Ghosn lack of integrity showed up in Nissan before this. Yes, profits improved but reliability tanked. For the past decade Nissan - once a highly respected brand - has been the only Japanese car manufacturer to build shoddy cars.
4
Cheat on your income tax in Japan and you can end up in jail; cheat on your income tax in the USA and you can end up President.
8
In America mountains would have to be moved before such a chairman would be arrested.
5
This is so bizarre one wonders if there is more to it than meets the eye.
2
I worked all my life in the oil patch for over 40 years.
Much of it as an expat.
As an employee, the company offers a service of several tax advisers to pick from - at their expense (on which you pay taxes). For an ordinary rank and file engineer - when he could file a one pager return if at home - becomes a reporting the size of a paperback.
Almost impossible to understand - and you sign your life away. Most of the time (in my case, all the times) - never an issue with donestic tax agency or with our IRS.
I know one of my employers had extensive operations in Japan - as several Japanese companies including Mitsubishi - often partner with Americans.
I had never heard - either through friends or a grapevine - a case of this type in Japan in my industry.
What was this man thinking???
Or who was preparing his returns??
1
It seems that Ghosn was setup in a classic case of entrapment. He simply had no reason or even the ability to conceal his true compensation from Japanese regulators. This is not the first time a foreign executive has suffered such a fate at a Japanese company, since destroying careers of accomplished foreign executives seems to be somewhat of a favorite pastime of the Japanese. They seem to relish it and get particular enjoyment out of it.
Michael Woodford's account of his horrible treatment by his Japanese colleagues while he was the CEO of another Japanese corporation Olympus in his excellent book "Exposure", showed many the dark side of corporate Japan.
Japan is already considered one of the most unattractive destinations for foreign expats to work in. This was recently confirmed by a European survey based on thousands of respondents. In this global survey, Japan was ranked a dismal 51st among 63 nations worldwide in its attractiveness to highly skilled foreign professionals (according to the 2017 IMD World Talent Ranking). Japan also ranked last among 11 Asian nations for its appeal to highly skilled foreign workers, behind countries like Indonesia, Thailand and Malaysia in this global survey ("Japan ranks dead last in Asia for top foreign talent", The Japan Times, Nov 21, 2017).
Such reckless treatment of global business leaders by Japan which throws them in Jail willy-nilly is not going to help the country's reputation.
13
If this Japanese reaction is a rejection of bloated pay packages for executives, then I'm cheering it loudly.
Personally I wrote two patents worth about fifteen million for my former global corporation. I saw nothing for them.
Our former 'great hair' three year CEO's buyout package when he got tired of jetting around the globe and leading?
Seventeen million.
Legalized theft is what it is.
6
Japanese corporations tend to be extremely perilous and hostile places for foreigners. This is especially true for foreigners in senior positions, since having non-Japanese in such roles creates deep animosity and resentment among their Japanese peers and staff. It does not matter how much the foreign person may have contributed to the company, since their results and accomplishments do not matter. In the end, it's always like the story of The Scorpion and the Frog.
It should come as no surprise to anyone that corporate Japan is famously insular, closed, deeply nationalist and very xenophobic. Foreigners working at Japanese companies are under the microscope and under constant scrutiny 24/7 by their Japanese colleagues, so it is impossible for me to believe that Ghosn could have gotten away with improper behavior for all these years as Nissan is now alleging.
Yes, there have been lots of cases of corporate corruption and financial irregularities at Japanese companies in recent years, but the culprits have never been just one or two individuals. Almost all such cases involved large groups of Japanese executives who conspired together to commit and keep such fraud hidden from the authorities.
A lone non-Japanese executive like Ghosn simply does not have the Japanese language ability, wherewithal or loyal network of Japanese peers inside Nissan to have gotten away with such improper behavior. This smacks of a conspiracy to bring down a foreign executive at a Japanese company.
9
The way I understand, the Japanese authorities are accusing Ghosn of not fully reporting the total value of non-monetary benefits he received from Nissan in the form of housing, etc., since he was indeed reporting his monetary compensation in full to Japanese authorities. The problem with this is that it is the companies themselves who are responsible for calculating and reporting the value of such non-monetary benefits paid to their staff. This process is so complicated that it is impossible for individuals to do this on their own. Large companies have entire accounting departments dedicated to this type of work, so I very much doubt Ghosn was ever aware or involved in the reporting of such benefits.
This story has more holes than Swiss cheese. It is extremely hard to believe that Ghosn and Kelly were able to hide a large chunk of their compensation from Japanese authorities for years without the knowledge of Nissan's compliance department, accountants and internal auditors, given the fact that these two were on Nissan's payroll. I have worked in senior positions at large companies in Japan over many years (both Japanese and multinational corporations) and this type of reporting to Japanese financial regulators and tax authorities regarding workers' compensation is always done by the company itself, not by the individual employees. All the regulatory paperwork is in Japanese and someone like Ghosn without any Japanese language skills wouldn't even know where to begin.
11
Part III (of III):
Furthermore, depending on the foreign (non-Japanese) country and company, a local executive's stock comp. may indeed be public when granted (i.e., 100,000 options or restricted shares, etc.), however the actual taxable event for the executive may be years later after vesting and the taxable income will be variable depending upon stock price movements and timing choices. Thus, in some cases, the actual final taxable "payout" (which can be much larger than the initial "value") is actually unknown to the company itself and is a personal income matter for the executive and his stock broker (and its income reporting requirements in the home country). In other words, the company may literally "not know" how much the executive was ultimately "paid". So, there is basically still room to "cheat", especially when concerning overseas stock-based incentives unknown to the local Japanese sub..
Now, as to whether Ghosn is a victim of xenophobia/coup or a legit "whistle blower"... I would lean towards coup. It is more "establishment" vs "outsider", but an "outsider" by behavior (management style) not race. He rubbed the establishment the wrong way. The Livedoor scandal in Japan comes to mind (google it). In that case, the CEO was Japanese but also a "disruptive" outsider to the market establishment. Both he and Ghosn perhaps suffered from personal greed and inflated egos, but what they were doing ordinarily wouldn't get you arrested and sentenced... until it did.
9
Part II:
Ultimately, the Japan tax authority "clamped-down" on overseas stock-related compensation and there was a sort of "landmark" court case about 15 years ago (maybe 20?) that basically killed the "gray zone" defense. Also, foreign subsidiaries were required to report "overseas" stock-related compensation for the first time, and more recently, there is more mandated "sharing" of individual income reporting between the US and Japan, for example. So, how could an executive still "under-report"? Well, first off, it's risky because the whole overseas stock comp. tax evasion game is a lot more visible in Japan compared to before. And, generally, it only "makes sense" to "cheat" when the Japan tax (50% [federal+local]) is higher than the overseas tax (due to various "double-taxation" eliminations/credits) or if you falsely claim to have already paid tax in the other country and claim the (foreign tax) credit in Japan. But, there are still some reasons why under-reporting can take place "undetected". For example, Japan can (and, does) compel a foreign subs. in Japan to disclose executive overseas stock comp. and this covers the majority of "ordinary" scenarios (US company HQ with stock incentives for wholly-owned local Japanese subsidiary). However, when the Japanese sub. is not wholly-owned by the overseas HQ, but instead part of a multi-national "alliance" or "partnership", the local entity may not be privy to the scope of overseas comp. and thus a potential blind spot.
3
deep-rooted xenophobia among Japanese Corporation.
Nissan as corporation should have known his reward.
Japanese executives seem to be able to evade legal responsibility.
Japanese social interest completely is away from problematic bills and Politics by this news.
4
I'd be happier if it was Mark Zuckerberg going to prison.
10
Part I:
My (educated) guess, having lived/worked in Japan as an expat for 20 years in hi-tech, is that this will boil-down to under-reported overseas (i.e., out of Japan) stock-related taxable events.
To give a little background, during the dotcom boom years, many US/European companies granted stock options (and, other stock-related compensation and incentives) to the top executives at their local (in Japan) subsidiaries, just like to those in the US. I'm greatly simplifying here, but basically, using US stock options as an example, when the options vest and are exercised this generates a taxable event in Japan for the executive.
In the case of US stock options (granted by US companies and exercised in the US stock market via a US broker) this type of income would be dutifully reported to the IRS by the broker in the US, but was a "blind spot" off the "radar" screen of the Japanese "IRS" (tax agency). In the heyday of the dotcom era, this type of overseas income suddenly became significant and more widespread for executives in foreign subsidiaries in Japan. To the Japanese tax authorities, it was clear that this should be taxed as "ordinary income" in Japan (which usually meant 50% all up) instead of "occasional income" (much lower rate) or not taxed at all. But, at first, many executives, when challenged, argued it was a "gray" area whether it should be taxed at all in Japan, and if so, then only at the low rate.
7
As I was reading this article and hearing the various reports on TV and National Public Radio, it occurred to me that none (perhaps one or two) of the executives whose actions created the great recession of 2008 were arrested, much less went to jails. Imagine if we arrested executives who committed crimes through the use of their offices here in the U.S.! our jails will be full of these executives and there may not be any candidates to run our largest corporations. Instead, we accept this as the cost of business, and save for a few exceptions, Enron comes to mind, fail to take appropriate action to punish and deter these crimes. Leave it up to Japan to be ahead of us on this.
10
@javierg - What crimes, exactly? Being greedy, blinding yourself to unbalanced markets, losing billions of dollars of investors money are not crimes. Nobody put a gun to homeowners to accept loans they couldn't afford. Bankers were dumb enough not to see the housing collapse, or those home loans would've been payable.
5
@Frederick Kiel
Frederdick,
I'm an auto mechanic that saw what was going to happen to the mortgage market in 06', 07...I made more money than I ever have or will during that time. I have a hard time believing that highly educated money and business managers didn't see it. It was criminal!
No other way to put it.
4
What struck me most was he wasn't arrested by tax evasion; so I guess he is not paying tax in Japan. He wasn't arrested by embezzlement either; so I assume his outsized salary was approved by the board of directors (assuming the approval is necessary). He was arrested merely by filing a falsified document to the authority. Maybe he was embarrassed to let his subordinates know how much he earned.
2
This article deserved its many comments. It stricks a chord and people are aware of tax evasion by elite executives and companies here in US and are reacting to it.
It contributes to the declining public funding for our detererating interstate highways with major bridges needing replacement costing 100's of $ billions with no funding available from current admin.
The system is broken.
4
@Steve Crouse - Tax evasion? "In 2014, the top 1 percent of taxpayers accounted for more income taxes paid than the bottom 90 percent combined. The top 1 percent of taxpayers paid $543 billion, or 39.48 percent of all income taxes, while the bottom 90 percent paid $400 billion, or 29.12 percent of all income taxes ...
In 2014, the top 50 percent of all taxpayers paid 97.3 percent of all individual income taxes while the bottom 50 percent paid the remaining 2.7 percent."
https://taxfoundation.org/summary-latest-federal-income-tax-data-2016-update/
Do you think the top 50% should pay 100% of taxes?
3
@Frederick Kiel Why didn't you mention the percent of total income earned by the top 1%?
9
@Frederick Kiel
Executive compensation has reached a disproportion with the pay of those supervised which is unconscionable. The only explanation is naked greed. I assume from your posts you find yourself among the entitled. You can correct the injustice while there is still time, or face the revolution if it continues. There are a lot more of the 99.1% than of the 0.1%. Reflect on the French Revolution.
4
Inside word here is that he was set up by Saikawa, who wants his job. The read is that Saikawa has brought shame on Nissan as an entity as well by this act of lese majesty. The story originated within Nissan, not the media or the Tokyo prosecutor's office.
9
@V Nagarajan
I thought Ghosn voluntarily went to the prosecutors office? And I thought he voluntarily provided them with information? This does not sound like someone about to "flee".
There seems to be a backstory here that is not being told. I have my doubts whether the Japanese prosecutors office is being totally transparent about what the real story is.
5
Note to spineless (and unelectable) Eric Holder: this is how it’s done.
6
One C.E.O. down, bout a thousand to go.
10
ah, the ultimate power and corruption adage.
Karma has GPS
5
The greed! Makes me ill.
8
Yeah.. some people have no sense of honor. There are also those for whom opportunity never knocked and who lead humble lives without asking for much. Who's the greater hero?
6
It is unfortunate that this story is reported out-of-context. Every week we read stories about major instances of corporate and/or government malfeasance in Japan. Faking inspections, cooking the books, filing false reports, etc. is rampant in Japan, and it is important to note that the vast majority of these cases are committed solely by Japanese personnel. In the context of this crooked corporate culture, it is not surprising that Mr. Ghosn and his colleagues would resort to false reporting in order to quell concerns over his unusually high executive compensation. This is common practice in Japan (part of "tatemae" culture), so a thorough reporter should be asking how/why Ghosn was outed, and by whom. Such revelations of misconduct never occur in a vacuum (in fact, pure whistle-blowing is rare/difficult in Japanese society), and there is usually some underlying political motive and usually a group of persons who are behind it. Perhaps Mr. Ghosn had angered the wrong people, or treated them poorly, and then they simply dug up the easiest instance of fraud in order to report him. Another important fact is that the Japanese police are usually very hesitant to arrest executives, and usually try to cover up cases of misconduct and only aggressively pursue them if there is public pressure to act. A couple of Nissan's other recent forays into fraud were noted here, but one can be reasonably certain that it is only the tip of a huge iceberg.
22
A compelling, clear-eyed assessment. There had to be some sort of consensus and collusion, though - Saikawa did not act alone, though he was most likely the instigator.
10
Another example of how those in powerful positions come to believe the normal rules and laws do not apply to them. There's no other explanation that makes sense (though I'm sure the famously detail-oriented Ghosm will claim this all happened without his knowledge).
3
To clarify
Ghosn is the Chairman of the Board of Nissan
The President and Chief Executive Officer of Nissan is Hiroto Saikawa
In many US companies the same person holds Chairman of the Board as well as CEO - e.g. at GM - but this is not the case at Nissan.
3
I'm trying to understand who actually OWNS Nissan.
Renault has by far the biggest stake (42%), Nissan owns about 20% of Renault. Mitsubishi is a minnow in all this.
The largest stakeholder in Renault is the French government. The EUs's rules on public ownership are far less restrictive than the Brussels haters will admit.
So, I guess Nissan is French, really.
3
I can remember when Nissan had remarkable quality, circa 1985. Their quality has definitely been in decline the last several years. Hearing that they had issues with their quality engineers is not a surprise to me, having just gotten rid of a Nissan with a leaking sunroof.
2
@Exiled NYC resident
I was thinking about buying a nissan pickup instead of sticking with Toyota to save a little money, but after reading about their quality control issues over the last several months decided against it.
Carlos Ghosn, Nissan’s Chairman, Is Arrested Over Financial Misconduct
In Japan
Still waiting for Wall Street Bankers to be arrested over financial misconduct.
In the US
34
Three cheers for whistleblowers. But before there develops a lot of excitement for how Japanese society is different with respect to corporate culture, let’s remember the malfeasance behind Takata airbags and adulterated Japanese steel. Not to mention Japanese utilities that downplayed the Fukushima nuclear disaster and subjected people to years of radiation poisoning.
19
@R.B.Many Japanese agree with your opinion.
6
There is a fundamental difference in that this appears to have been a palace coup aimed at removing a CEO, and public safety was never in danger. There was also no collusion after the fact to cover it up - nor was the government involved in the coverup effort, as they were in Fukushima.
3
One remembers the huge amount lost by Olympus executives on phony investments exposed by the whistle-blowing American President. Did they go jail? What happened to the American President of Olympus? Removed in a coup. Tremendous loss for share holders!
2
Funny that just the other day I watched a video in which a mechanic lamented the drop in quality of Nissan cars ever since joining Renault. Another video showed a mechanic looking for the cause of failure in a newer Nissan transmission. Turns out he found the failure was due to poor design and poor materials. Kind of makes one wonder how successful Ghosn's cost cutting really was if quality suffered. Maybe another big wig who just wants a certain result and doesn't care how it's obtained.
8
@iGreg White
I own a Nissan 2010 Versa and was seriously upset when I had to pay $3,000 to replace my transmission at 130,000 miles. And, guess what? My warranty ran out at 120,000.
4
@Greg White
I bought a Nissan Qashqai new more than 10 years ago.
British designed and all built in the UK at Nissan's Sunderland factory in NE England [1]. Nissan's globally best selling car, ever.
Just after purchase, I was told that it was a Renault - well, certainly full of Renault parts. I waited for the inevitable consequences of poor design, manufacture and build quality.
Anecdote, I know, but it's been a peach of a car. Not a single fault in 10+ years. Not one. Oil, new tires, a couple of lamp bulbs and a wiper blade. That's it.
I guess it's not all mechanics who dislike Nissan. The boss of my low budget back-street auto repair shop nodded approvingly when I brought it in for routine service. He'd kept a parade of pretty hateful Fiat, Vauxhall (GM) and Ford machines going for me in the past.
[1] Nissan set up their first European manufactory in the UK in the early 1980s. They saw the value of being able to sell Japanese cars tariff free in Europe (provided they utilised 50%+ European components). Oh, and Mrs Thatcher's government stuffed their coffers with taxpayer money to sweeten the deal.
The Sunderland region voted for Brexit by the greatest majority of any UK area in the 2016 referendum. Now we're leaving, there's no reason for Nissan to stay in the UK. Sunderland has now become the region which has subsequently expressed the biggest rowback from, and regret about Brexit. Bite the hand that feeds you? You can't tell some people anything...
10
@Abagail Winslow
When you bought the car, you knew that the warranty ran out at 120k miles. So why exactly were you upset when your repair at 130k was not covered by the warranty?
1
I sincerely don’t mean to be dense, but the article isn’t clear on why he was arrested. Can someone explain it to me? I get that his compensation is significantly higher than the norm but what laws were broken or what chicanery was involved in circumventing the rules?
6
Hi, news in Tokyo reports that he misused company funds for personal reasons, together with the second person arrested. However, investigative joutnalists point out that.the French government's strengthening control or Renaut, and their desire to gain more control of Nissan may have been the big motivation for wanting to remove Mr G. Hope this info helps.
3
Sorry for the typos.
@Alex
Reading between the lines, it sounds like he broke laws relating to corporate governance.
In many countries, corporates are legally obliged to report financial information that includes things like remuneration packages (particularly bonuses) of board members and senior officers. Concealment of pay to a CEO would constitute a criminal offense.
I'm sure you must have that in the US.
2
Pigs get fat and hogs get slaughtered. As a teacher, I find myself wishing I had more money for special occasions like Christmas. I wish I could spend a few hundred bucks to take friends to dinner without worrying about how to make up for it in my monthly budget, but overall, I feel like I am being paid fairly and I'm thankful to have a good job. It's hard for me to understand why someone so rich is compelled to steal (allegedly) to become richer.
30
Just another example of how the far the mora compass has deviated from true north for many of the world's leaders. They are leading by example, but in the wrong way, leading by saying "when you're at the top you're entitled to do anything and get anywhere" it is the logical conclusion of the concept of meritocracy taken to its extreme expression.
9
Unbelievable by going through the following popular quotes of
Mr.Carlos Ghosn.
'I think that the best training a top manager can be engaged in,
is management by example" and " You will never convince me
there is hopeless situation or there is only finality in any success or any failure".
6
One day you won’t be immune from the law anymore, Trump. Scared to read news like this? Let’s see those tax returns, Chief.
20
@Be Better I think one mistake in your email comment. "One day you won't be immune from the law anymore, Faker in Chief Trump." Another commented on Ghosn's meaningless quotes. How about some of this President's quotes!
5
Would someone please define ‘Financial Misconduct’. Is that when the rich’n’famous cheat on their taxes?
11
I don't know if the West understands the Eastern mindset or ethos. As an illustration when has the US or other Western powers ever came out of negotiations with an advantage, not Viet Nam and not Korea. Maybe it was the British with their Opium in China when The Crown received Hong Kong in the deal. I am surprised Ghosn lasted as long as he did, we shall have to wait to see if it was greed that brought him down.
I think the issue really is how much money is enough? Not how much to pay a CEO or brain surgeon but how much is enough and when is any more waste? The ridiculous salaries and compensation some get is absurd and obscene. Is enough pay 10,000 times a teachers salary and any more would be waste or should compensation provide enough wealth so 6 generations would be able live off of comfortably?
10
Good to see that happening but the timing is weird. It does seem political and the next board Nissan meeting is days away as far as I know. Expect the Japanese to retake control of Nissan and Mitsubishi.
5
Btw, if Nissan, Renault, and Mitsubishi need a new Chairman/CEO etc... I'll do the whole lot, say for something like $3-4 mil. What do you say? It'll save you a lot and who knows maybe I'll do a better job. I'll be more focused on the company and I won't be going around being all tied up with how important I am.
A proposal you can't turn down.
8
And all from an "internal company investigation". This would never happen in the States.
9
Carlos Goshn will always be identified as the chief promoter-visionary of EVs for the common man in his role as joint-CEO/Chair of the “Alliance”: Nissan-Renault- Mitsubishi. Nissan Leaf was Goshn's brainchild. Nissan's leadership in bringing EVs to the broadest consumer segment of the automobile market will be Goshn's legacy.
He is the auto industry maverick who committed Nissan-Renault in 2008 to become the leading EV manufacturer. His steadfast support of growing the EV market with quality vehicles had challenged other major automakers - GM and Volkswagen.
Goshn’s decision to go Electric also stimulated growth in EV chargers and batteries industries. These industries would not survive only on Tesla. Goshn’s EV plan is to focus on quality and profitability:
“... By the end of our strategic plan Alliance 2022, we aim to double our annual synergies to €10 billion ($11.5 B). To achieve this target, ... Renault, Nissan and Mitsubishi .. will accelerate collaboration on common platforms, powertrains and next-generation electric, autonomous and connected technologies.”
https://electrek.co/2017/09/15/renault-nissan-mitsubishi-alliance-12-new-all-electric-vehicles/
Goshn is the EV's "point of inflection". He defied ICE vehicles production dictates to venture into a future of lower GHG emissions and affordable EVs that introduced a path to Autonomous Vehicles that industry participants expect will reduce road accidents by incorporating A.I. into the driving experience.
7
I worked for Nissan for over 30 years.
This is not a surprise for many of us.
Many of the Ghosn minions are sure to go down.
11
After 19 years under various structures Nissan bring charges which result in Ghosn's arrest!?!? His compensation has always been discussed as outlandish from day one and if the complicated structures under which the various entities were not understood and audited by Nissan, shame on them.
I do not have great confidence in the various entity structures that involved Nissan, either directly or indirectly nor their governance, nor do I have great confidence in their internal and external accounts controls and standards.
This affair smacks of kabuki. Let us keep in mind the Olympus accounting scandal of 2011 and the fate of gaijin when matters go wrong or in-country leadership wants them outed.
7
This is a fascinating story that could develop in so many ways - legal, financial, cultural. Ghosn is legendary in Japan and France (and his own mind) and indisputably saved Nissan. But were he and Kelly thrown under a shiny Nissan bus by local Japanese beancounters?
Japanese television news was in major "breaking news" mode, and emphasized that a whistleblower (内部通報) at NIssan uncovered "misconduct" (不正行為 usually a term used for civil tort) and contacted police, pledging cooperation. Ghosn and Kelly were also likely given time and notice, to retain defense counsel.
Putting aside the alleged personal use of assets, which seems to be a prosecutorial back-up charge, the principal wrongdoing seems to be intentionally misreporting the two executives' compensation. That is a usually a crime by the corporation against public shareholders. So maybe Nissan is trying to do damage control by turning in its two biggest executives, who just happen to be foreigners, when the type of activity alleged almost certainly involved several other individuals and departments within Nissan, not to mention approval by the Board of Directors.
Buckle up and stay tuned.
24
@bengoshi2b - A good summary; "just happen to be foreigners" just about sums up the likely attitude, added to which is the haste with which the CEO is acting to oust Ghosn. Smells a bit like Olympus - smear the foreigner in the hope of getting away with something else.
8
"According to Nissan's securities filings..."
How is it that the compensation of the CEO of a publicly-traded company is not detailed in the company's quarterly filings with the relevant securities agencies (SEC in the U.S., for example)?Assuming it was, who/what are the Japanese financial authorities that missed this?
10
Couldn’t have happened to a better person. Note my sarcasm: long deserved punishment to a man so engulfed by his hubris. An example of how not to lead.
11
@Ex-Nissan
Exactly! Full of himself. Good ridance.
4
@PJR How about the President of the US? Isn't he even more "full of himself?" So what fate is he to get form those who adore him? Why can't they see what you noted with Ghosn.
3
@JHM
You tell me. I am at a loss as well.
Mr Ghosn's roots are in the Middle East, biologically, culturally and ethically.
6
@ Giskander and so? Is there a point in your comment?
2
...right, because Ford never had issues with lying to the public. How about a nice Pinto???
1
Nissan is a great car. A pity that this is happening, but greed is not just limited to Americans.
These are the type of headlines that tend to become more frequent around a stock market top.
5
Poor guy. He'll just now become a sacrificial lamb in a very sophisticated global game. Unlike his counterparts in corporate kleptocracy, he won't be walking away with his millions unscathed.
Oh well. He knew the risks.
3
@Helina
Poor he is not, Neither in wealth nor self-regard!
2
If only the US would lock up similar white collar criminals and the board of directors who facilitate such behavior we might have a system worth respecting.
We would also have triple the number of prisoners incarcerated.
12
@J. R.Nice of you to try and convict the guy with no proof or reasonable explanation. How could someone in his position under-report his income? Do Nissan not know how much they paid him. Why would anyone in his position put himself at that kind of risk?
2
Perhaps his income consists of numerous sources some of which do not have to be declared. This isn’t the IS tax code we’re talking about. If he intentionally mis-categorized taxable income as non-taxable, that would be an underreported income.
I was in the same graduating class as Carlos Ghosn’s daughter in high school. We were fortunate enough to have the opportunity to have him give our commencement speech - after everything we heard about his impressive career, I was quite excited. He spent the full 20 minutes talking about how he made his first, second...third million...etc. It was the most boring and uninspiring speech I’ve ever heard, and I’ll never forget how terribly sleazy it was. I was only 17 and I already thought: I hope I never grow up to be like that man! No surprise here.
21
Superb reporting, ASP 2007 !
7
@ASP 2007 - He sounds like Trump.
Are they all alike in that way?
3
@ASP 2007
Some people seem to be even worse than their worst press: it's interesting to have such a completely unbiased report.
2
Disclaimer: I like Nissan products, both pre and post-Ghosn.
That said, the most striking thing about this piece is that what he was being paid is a pittance compared to what CEOs working in finance, pharmaceuticals, and health insurance get paid:
https://www.npr.org/sections/health-shots/2017/07/26/539518682/as-cost-of-u-s-health-care-skyrockets-so-does-pay-of-health-care-ceos
3
@Middleman MD Trump promised to do something at least about drug prices. Just pre 2018 election rhetoric I suppose. Like his Middle Class tax cut plan. And limiting terms for Congress etc.
Big executives have contracts like professional athletes. Ghosn works three months a year for each car company and wants millions from each and "doesn't do business for any of the other car companies in those three months". I've seen this same story too many times how blue collar workers hold these execs in such high regard, "Clean up, straighten your shirt, he will be in town next week and might stop by for a visit". Apartments for mistresses, company jets for golf outings and guaranteed incomes of millions regardless of the company's financial performance. THEY KNOW EXACTLY WHAT THEY ARE DOING!
10
A pay package of US$8.5 Million doesn't sound like very much for a company that size.
An Internet search says Goldman Sachs CEO Blankfein gets $2 million.
And an Internet search for hedge fund managers says the top two earners — James Simons, founder of Renaissance Technologies, and Ray Dalio, founder of Bridgewater Associates — netted $1.6 billion and $1.4 billion, respectively.
5
@Independent
Correction:
Blankfein gets $24 Million, not $2 Million.
4
"A pay package of US$8.5 Million doesn't sound like very much for a company that size."
That's because the abnormal has become normal. Let the market decide and see what salaries these kleptomaniacs should really be earning. Nothing more than six figures.
They are not rock stars. Just crooks in a rigged game.
12
What else do he get in compensation that isn’t cash? Home(s), cars, extensive personal travel, numerous no-show jobs for family and friends?
Long overdue! And a refreshing change to the "anything goes" attitude of governments towards corporate criminals!
If more corporate malefactors were arrested, humiliated by being led out in handcuffs (as Drexel crooks were in NYC in the 1980s), indicted, and convicted of criminal charges -- with appropriately long jail sentences awaiting -- corporate criminality would decrease markedly.
And so would the public's respect for laws and our systems of justice. Sadly, this all seems impossible in the USA kleptocracy.
10
Every successful French businessman sits at a sumptuous Louis XV desk, placed strategically before the cavernous cheminée (fireplace). So he can throw the falsified invoices and other incriminating documents directly into the flames at his daily convenience...
10
@Tournachonadar
Lovely.
3
@Tournachonadar
He's not French..
And it was Louis XIV who was into furniture, fireplaces, palaces..
1
This has been a long time coming. The old Japan business culture with its xenophobia and racism has hated Ghosn for years and beenitching to bring him down; another one for the list of foreign executives who dared to delve into Japan's rotten corporate culture; shareholders treated as an irritant, corporate governance almost non-existent and companies treated like piggy-banks for directors.
Now he will be subject to the third-world criminal legal system; no bail, minimal visits, obstruction of lawyers, interrogation without counsel and pressure to confess.
This all stinks of a set-up, or some spurious allegations; can someone like Ghosn really have hidden millions of dollars of income? It might well be a question of tax residency rather than hiding revenue. As for the suggestion that there was a shock at a director using company assets, I just had to laugh.....
16
Yet they continue to lionize CEOs like Ghosn and Jack Welch in business-school case histories, even though these two haven't had a win in decades and both, as we now see with Ghosn, have had more than a few financial misconduct incidents to their names. In the MBA program I was in during 2007-09, I thought Ghosn was much ado about nothing but a pompous macho man thought to be more charismatic than most. Welch had moved slightly beyond his second messy and expensive divorce, begun his third marriage to a woman much younger, whose own ethics were questionable considering she was an editor of the Harvard Business Review (and a married mother of four) at the time she began her affair with Welch, and evidence that he (Welch) had used shady financial models to inflate GE's stock. And now he and the new missus have their own MBA program - cue up P. T. Barnum. And American business leaders have the nerve to laugh at Italy, deride Greece, and bully the Brits about their financial practices!
6
@TurandotNeverSleeps
Welch was so lionized, that it is hard to find anyone in the investment b business to criticize him. He led GE through a period starting at the end of super-stagflation ( late 70's) when the stock market also exploded in value. He also was a leader in slashing employees, R&D, and veering away from production to focus on where the money could then be made - finance. He was a master of the art of cannibalizing companies - GE itself, and RCA. My "lay' person's impression is that some of his initiatives early on made sense, but his belief in his own brilliance - and in the level remuneration he deserved - was greatly aided by the general growth of stocks and the economy in that period, AND that he left before 9/11, before some very rough times.
1
Everyone knows the 2014 Nissan Pathfinder was a lemon. Everyone knows it. We own one of these piles of garbage! What to do with it? Keep it? Sell it? I couldn't sell it with a straight face.
Nissan should replace every one of these piles of garbage. Rid our streets of trash.
2
Looks like you picked the wrong week to quit sniffing glue, DudeNumber42.
7
Arresting an executive for financial crimes. Well that's new! We wouldn't tolerate such government overreach in America, would we?!
13
Actually through creative accounting and lying or pretending ignorance, here in the US you get to be a Florida Governor and then a Senator with dubious ill gained profits from all and any scams you may have pulled in the past, does that sound right Scott?
14
Perhaps they need a name change. A fresh image.
How about 'Datsun'. . . Hmmm, nice ring to it, yes?
4
Finally a male executive gets fired because of financial misconduct instead of pulling out his penis. aka penis Misconduct. I was like omg Not another one?!
3
Wow -- a white collar crime that actually gets the perp arrested. Imagine that. In the US, execs who do this stuff are just removed from their position, handed a huge financial package, and are allowed to walk out the door and never sniff being arrested or serving jail time.
We should adopt the Japanese system of justice that extends to the highly visible and the highly paid.
9
Now if only the US had a legal system to go after the 1%er crooks!
28
There's a lot wrong with that car company—their attack on the owner of their preferred Web domain nissan.com, and their embrace of Brexit to get their own tax favors from Britain (and the Tories' apparent willingness to happily oblige), among the bigger problems.
But if this really was their response to a whistleblower, and not just outsider bigotry at work, then this is something to smile a bit about. Company owners (like shareholders), and (FAR more importantly) employees, should expect the revenues to go where the company says they go and thus have some idea of its (and their jobs'!) operating life expectancy. Seems Ghosn cut jobs while reaping the rewards all for himself...surprise surprise.
12
@SR
"and their embrace of Brexit to get their own tax favors from Britain (and the Tories' apparent willingness to happily oblige)"
Interesting...
Nobody, like nobody, knows what went on between Nissan and the UK government. We here have been told in 'Read My Lips' clarity that it doesn't involve any kind of payment and that it will not cost UK taxpayers a penny.
Nissan haven't said they're leaving - and they haven't said they're staying.
There are few reasons why Nissan would continue to make cars in the UK after Brexit. Why would they? The benefit disappears when Britain leaves the EU. Calling this as 'embracing Brexit' is absurdly judgemental. Nissan is a car manufacturer not the IMF or the Red Cross.
2
This gave me a little bit of a chuckle: "Foreign investors tend to criticize Japanese companies as not paying executives enough."
Foreign investors may want to make sure executives with big compensation packages are not playing shortsighted games that could hurt the company and in the long run. And, ensure that executive compensation isn't inordinately expensive too . And make sure that management does what it is supposed to do, in realizing profitable growth, innovation, marketshare gains, etc.
13
0Massive cost cutting? Coincidentally those early Renault years was when the quality of Nissan's vehicles took a nose dive. I guess some of those sweeping changes included cutting corners with the quality of the components used including those dismally poor Jatco transmissions that would overheat incessantly and die before 100k miles. Nissan vehicles before this era were solid.
Good riddance; his corner cutting was clearly not limited to the quality of Nissan's products and now that has caught up with him.
23
I pondered, then shuttered at the thought of how many people died as a result of the corners cut. This may open the lid to Pandora's box...then again nothing will like happen.
2
It's written that John D. Rockefeller replied when he was asked, "What is enough?":
"Just a little bit more."
Some wealthy people lose perspective and cognizance of their greed. Some just accept it as a consequence of their ambition.
19
Wow! They actually arrest COE's in Japan for lying to financial authorities. In the U.S. they elect them president or give them Cabinet level positions such as head of the Department of Justice.
113
Worst part is our system idolizes those who thise that make such huge somes of money. Which of course usually comes from cutting corners pink read define regulation find favor to political campaign donations to both parties our country is going to wind up looking like the lamb left behind by Walli pretty soon- and the champions of the corporate world will be the cause. Lock them up!
5
What? Someone lost their job over "creative accounting?"
In the US, that behavior would would be worth a big bonus!
In the US, we have entirely lost any sense of Shame -- and it's a shame.
We are preached to of the value of "personal responsibility" -- but only for street people and such -- never for business people.
43
It's always amazing to me how people believe that if they team up with an unethical person they will be exempt from that person's unethical behavior. A person who would lay off $21,000 employees to increase profits has proven he knows no boundaries when it comes to making money....a glaring warning sign. In short, he who will cheat for or with you, will eventually cheat you.
15
What is the misconduct? That he did not report for his taxes, or he was stealing from the company?
This article is hysterical. Why do markets collapse and the French government have to circle the wagons? Why is his demise so harmful to production jobs?
Is he the world's most powerful person nobody every heard of?
13
@Paul Well, clearly you never heard of him. Check out Revenge of the Electric Car and you will get plenty Ghosn. Very positive in that context, as it also is with Bob Lutz, who gets a redemption, following a few years following the demise of the EV1.
4
@Paul I agree, I have no idea what he did or did not do. Within this article he is obviously treated as guilty of something nefarious without any evidence, or conclusion from a neutral body such as a judge or jury.
1
@Paul - you obviously did not suffer through the ridiculous mythology of Ghosn's act as a leader. He's very famous - and now infamous.
1
Aaah, capitalism...
10
Oh this is so easy. Don't you like easy? Throw the creep in jail for tax evasion.
6
There is something that does not make sense in all of this. Why would a top notch executive underreport an income that is public. Anyone can find out how much he is paid. He cannot be that dumb. And the the accusation of using company assets !!! What does that mean? That while in Tokyo he used a company car? I will await the detailed report of the accusations and find out what Mr. Ghosn has to say about them.
19
They also arrested an HR exec, probably the one managing the reporting of salary income to the tax authorities. They appear to have conspired and some junior level HR officials may have reported it. Keep in mind that Japanese tax authorities rarely arrest anyone. They would not do this without a mountain of evidence.
11
To cut the taxes he paid. Some countries actually have a tax system tough to cheat.... like the tax board looks up on line all corporate titans pay?! If one is waiting, you support tax cheats & probably voted for the trumpster.
@Ghassan Karam Not sure if his Japanese income is made public, such as it would be in the U.S.
1
It smells like the Olympus scandal. It may have been the only option to get rid of an untouchable.
7
@JClausen: absolutely they needed a reason to get rid of him, but he gave them plenty!
6 million ? Tokyo is very expensive.
3
As if he was not paid enough. Greed, greed, more greed. If only this could happen to more of this type. Poor Nissan.
10
@JHM I suggest you do a little more reading. "Poor Nissan"? Seriously?
1
I thought I had something important to say until I read the comments of Pquincy14 & Socrates. Their thoughts are on target! These "compensation" packages are taking too much money out of circulation as well as preventing employees from earning wages commensurate with their contribution to the employer. It is left to us, the taxpayers, to provide the housing and grocery supplements the prevent homelessness and malnutrition. We, the taxpayers, who did not receive benefit from
Trump's tax cuts are making up the pay gap. The overly compensated executives use their salaries as a means of keeping score like a "reality" game of Monopoly. It is so pathetic to see them parading and preening as if their money covers their aged, wrinkled & misshapen bodies. They have lost not only their youth but their souls.
38
As bizarre and unexpected as this news is, it shouldn't take anything away from Ghosn's courage, and I intentionally use that word, in bringing the Leaf electric car to market in 2011. This was when owning an electric car meant having either a home-built conversion of a gas car, a remnant of the California initiative shown in the film "Who Killed The Electric Car", or a $150k+ Tesla Roadster.
Ghosn saw an opportunity and took the leap (in an industry not know for taking leaps) into creating a market for an affordable 80'ish mile EV. Yes, it wasn't for cross country road trips, but our first (of two) Leafs was an absolutely wonderful second car that soon absorbed almost all driving. Nissan also wisely did the marketing work necessary to properly show the Leaf to the public by having a nationwide series of ride-and-drives.
The Leaf and its wider effects in the automotive ecosystem is something history will look very favorably on.
11
Indeed, and although you can't buy them any more here I've only ever seen one Leaf, I have seen this man interviewed in an online video channel.
What I saw there was a man genuinely enthusiastic and motivated by the environmental and engineering possibilities, rather than personal enrichment.
I am struck by the greed and deception. I am also struck by the Japanese company's response, which includes apology and embarrassment.
Shame is powerful. I'm sorry that in the USA, in politics as well as in business, we downplay it. We denominate everything in dollars or time served. We devalue remorse and atonement; we offer book deals instead.
We also forget that none of us is perfect, and all of us have the capacity (if not the desire) to learn. We devalue seeking mercy and forgiveness...and granting it.
12
Leaving aside the outrage in readers' comments, I feel like some of the facts are missing. What did he report, what did he really earn, and what's the explanation? Given all the public discussion of how much he's paid, how is it possible that he misreported?
31
@Adam from Queens I agree. There is something not quite right with this story. A lot of facts have been deliberately left out. What is really going on here?
11
Two thoughts: One, good that executives who were regarded as untouchable can very much be subject to the same laws that apply to everyday people. Two: The big fly in the ointment is that, in Japan possibly even more so than here, that is still an exception, not the rule. I guess it also helped that these two are gaijin (foreigners). I for one am still waiting for a thorough investigation of TEPCO's lack of preparation for and bungled response to the disastrous meltdowns at Fukushima. Current cleanup operations exploit homeless and otherwise vulnerable populations and utilize Yakuza-controlled subcontractors. Maybe the same investigators of the current scandal at Nissan can take a look at that situation next.
12
@Pete in Downtown
Yes TEPCO used and uses untrained, and one- step-removed - contractors -- like US companies do - to handle work that should have been and should be tightly supervised.
Finally members of the International Mafia who have been trying to take over financial systems around the world are being prosecuted.
Corruption is so rampant in the BIG corporate/financial world that it's nearly beyond belief. I hope these crooks are actually prosecuted and the wealth they have stolen taken back to preserve/restore social safety nets around the world.
WE THE PEOPLE - average people around the world who do not want to see their lives further destroyed - are the only ones who can/will stop them and NOW is the time.
Before they can start WW3 to try to retain their stolen supposed "power".
18
Given a conviction rate of 99%+ and no plea bargaining in Japan....I would not be surprised if Mr. Ghosn spent time in jail.
13
Japan's high conviction rate relies on obtaining confessions from alleged perpetrators often under duress. That has resulted in the conviction of people later found innocent.
https://www.bbc.com/news/magazine-20810572
9
Compared to our executives, he is an underpaid footnote.
33
Could never happen in US. The lawyers will exploit every loophole to get acquittal. Trump would say as long as 29.4 Mullins cars are sold he should go free
7
Greed is the great driver of capitalism & the free market. Dah!
14
All mine, my presciousssss...
8
Blame the accountant, Carlos. Or take your lumps as CNBC suggests will happen and retire Large on your many millions and fat pensions you have accumulated by age 64.
4
Not a single one of these Godless money-grubbing thieves has a concept of the word ENOUGH.
The Fraud Street Journal reported that the total taxpayer funded giveaway to (155) billionaire Jeff Bezos in the Scamazon rip-off could be five billion dollars. If I ever had 10% of Bezos money there is no way on earth that I could ask taxpayers for a five million dollar gift so that I could expand my business and make more money.
The greed of these sociopaths is astounding.
29
Bravo to the whistleblower who turned in the Nissan Chairman. Strengthen laws protecting brave people that report corporate and political skulduggery and the world will be a more equitable honest and verdant place.
32
Well, it’s reassuring to know that graft and corruption are still punishable....somewhere.
229
I will stick with Tesla partly because of how shallow the reporting on them by all major news outlets has been.
Now, where is the head of Audi again?
10
Why even take the risk when you're already making so money? How much can one man need?
124
It is a pathological tendency deeply rooted in capitalism.
30
@Ed Watters, I don't think that Carlos Ghosn's pathological tendency is deeply rooted in capitalism. It is deeply rooted in his mistaking external power -- that which can be bought, sold, won, lost, negotiated, controlled and to which his ego is addicted -- with authentic power, of which he has no understanding or knowledge. Authentic power means being aligned with your essence, your inner authority, your Higher Self, your Soul. Authentic power means thinking, speaking and acting in coherence with who you are at your core. Sadly, Carlos Ghosn is not alone in his misunderstanding of power. Despite his millions, like so many other wealthy individuals and "big" bosses, he's terribly poor.
For a different perspective on capitalism, I recommend your Googling "Conscious Capitalism" and the "Coalition for Inclusive Capitalism." There's hope.
That said, there's still a great deal of soul searching and hard work to be done before capitalism lives up to its formidable potential and contributes to a better quality of life for all. Ghosn and his like are roadblocks ... but through conscious and inclusive intention, we will find the way.
3
@Kim Derderian Without capitalistic excesses, the only things people will be hoarding are old newspapers, etc.
The only problems I have with Conscious Capitalism and the Coalition for Inclusive Capitalism is that they have no chance whatsoever of being adopted to any meaningful degree.
Capitalism is all about maximizing profit without regard to externalities. Your idealism has turned into a cul-de-sac. Act accordingly.
4
It is good to see Japan and France working to rein in greedy executives. More countries should follow the example. In an age where too many have no idea where their next meal is coming from, the kind of outrageous compensation some people have come to expect as their due must become a thing of the past. These greed-driven men must be taught that nobody is above the law. More of this, please, from all governments that are truly interested in putting a stop to corruption.
106
@Allison: "greed-driven men."
Not going to let you get away that. Not in the Me Too era. Marissa Mayer, Carly Fiorina, Sheryl Sandberg, Oprah Winfrey, Alice Walton, Christy Walton,etc...
Greed-driven sociopaths. Greed-driven people. Greed-driven freaks. Whatever your pleasure is. But not greed-driven men. Times up for that nonsense.
53
@Allison “These greed driven men...” is a pretty sexist perspective given that the auto industry’s highest paid CEO, Mary Barra, is a woman who earned significantly more than Ghosn (and other male auto industry executives).
21
http://www.pewsocialtrends.org/fact-sheet/the-data-on-women-leaders/
Guys, as long as women make up less than twenty percent of most governing bodies and the boards of companies, we're still talking about men. The Fortune 500 list of CEOs is five percent female. That means it is NINETY-FIVE percent male. Get real. You list a handful of women, but you probably could not name many more. Women did not invent corporate culture, nor have they yet to shape it in any significant way.
When boards, CEOs, and government entities are fifty percent female, we can talk about shared responsibility. Until then, you're just making stuff up.
17
Read Ghosn's new book, "Reach In," with his co-author, Sharon Sandberg
55
@Cazanoma best comment ever!
2
@Cazanoma"Reach-In - and grab some cash"
3
Sheryl, not Sharon. But good one liner though!
3
Did this profiteering happen outside the US? Is that allowed? And it seems this guy went one up on Goldilocks?? That's a definite No-No, right? What will this do to unravel US-Japan relations?
It seems that this man felt that he wasn’t being adequately compensated for the miraculous recovery he engineered, or perhaps he thought the authorities were so gullible that they deserved to be cheated by him.
Either way, from my perch in the middle class, I’m gobsmacked that he wasn’t willing to pay his legal share of an enormous salary to the taxman.
27
One week ago, Carlos was standing near Macron during a plant visit by the president...while unionists were booing the Psesident's economic agenda, perceived as progressively destroying the middle class. Mr Ghosn's problems are not going to solve Macron's.
10
What a shock to see how other countries treat financial crimes!
53
Why does someone in his position do this? He’s paid millions, yet instead of focusing on the enormous wealth he has, he’s obsessed with what’s being taken away in taxes or currency devaluation or contract negotiations. The hazards are so great – criminal liability, professional downfall, disgrace and vilification – and the risk of being eventually found out close enough to 100% that no sane person should even think twice about trying to skirt tax law. And yet, here’s one more in a long parade of fools who had more than most of us will ever see, and it wasn’t enough.
43
Very light on details so far. The charge seems almost farcical; doesn’t the company know how much they pay him. Perhaps he underreported income he may have received from other positions he’s held? Interesting that Ghosn gets arrested while some in the US politics (and corporates) who have failed to disclose their stakes, income, conflicts of interest, etc. are free to keep doing what they’re doing.
60
Good for Japan.... Here in the good ol' USA, he would jump with a golden parachute, and chauffeur-driven away into the sunset in his gilded Rolls Phantom.... case closed...
95
@Merlin. Or be elected Governor and Senator as in Florida.
11
@Pete
Yep... he would lie low for a couple of years, and re-emerge to run for political office... most likely as a Republican.
1
Imagine arresting crooked corporate executives. Once again, Japan is out-innovating us again.
203
So what is Greg Kelly accused of? Misconduct of what kind?
3
Years ago, my understanding, in the corporate world, that the ultimate means of "keeping score", is the amount of compensation received.
1
Greed is everywhere nowadays. It’s not enough for these execs to make millions? I love how they call it ‘under reporting his income.’ He lied so that he could keep even more if his money. I’ve lost my faith in the system. It naught but works for the Uber wealthy.
65
@Mike L "He lied so that he could keep even more if his money"
He lied so that he could keep even more of OUR MONEY. Everyone who has bought a Nissan, Renault or a Mitsubishi that is.
I would like specifics - just to understand what has transpired. Maybe Japanese judicial system does not file charging documents when a person is arrested (they would provide detail of what the transgressions are). More facts are needed. I see generalizations made, lots of detail on Ghosn's salary, nothing on the American dude.
Precisely, what did they do?
54
There is probably more to this story than meets the eye, but the damage is done.
15
@William Taylor
Unfortunately, we see waaay too much news reported this way. Nikki Haley could easily expound on that.
Envy and greed... they continue to drive our corporate culture.
Although Mr Ghosn was undoubtedly well-paid, looking at the way American corporate executives loot their companies, taking home not millions but hundreds of millions per yer, must have driven a competitive man to distraction. And the relentless greed that has become the mantra of corporate governance (decked out in the seductive dress of 'shareholder value') made him try to keep more of the large but not grotesque salaries he was getting.
The so-called revolution in corporate culture that emerged in the United States in the 1970s and 1980s (thanks Milton Friedman and Ronald Reagan) has created a breeding ground for sociopaths in the C-suite. Mr Ghosn's envy and greed have led him down a similar path, it appears.
143
@Pquincy14 I believe you have it right with "sociopath". I have known some of these. First they make a few million with one company. Then they have to make tens of millions on the next one, then hundreds, and then finally they have to make a billion dollars selling a company because otherwise they are not in the right club. And to get there they do all kinds of nefarious things. Generally smart, often charming, and always ruthless. But ruled by their ego.
I think author Martha Stout got it right in 2006 in her book "The Sociopath Next Door".
47
Another greedy corporate scoundrel full of entitlement exposed by sunlight and a brave whistleblower.
Three cheers for Japanese society and the whistleblower.
208