Brazilian-born Carlos Ghosn long stood out among the world’s auto executives as a hard-nosed workaholic willing to take drastic measures to get struggling companies motoring again.
As head of the Renault-Nissan-Mitsubishi alliance, Ghosn created an industrial behemoth numbering 470,000 employees, selling 10.6 million cars last year from 122 factories around the globe.
But the man once dubbed “le cost killer” by the French media has suffered a spectacular fall from grace, facing allegations of under-reporting his compensation to authorities by millions of dollars.
Since his shock arrest on November 19, Ghosn has been fired from the boards of Nissan and Mitsubishi Motors, following a months-long inquiry prompted by a whistle-blower. He denies the allegations.
It is not the first time Ghosn has hit the skids over pay. He was among the highest-earning CEOs in France and one of the best-paid foreign executives in Japan. His total compensation as head of the alliance reached some 13 million euros ($15 million) in 2017, according to the consultancy Proxinvest.
Last year he denied a report that the alliance was planning to pay hidden bonuses to its executives by setting up a subsidiary in the Netherlands.
The French state, which owns a 15 percent stake in Renault, forced Ghosn to accept a 30 percent pay cut from the 7.25 million euros he took home as Renault CEO last year, calling the amount “excessive”.
The government had already protested in 2016, joining with 54 percent of voters at Renault’s annual meeting in refusing to authorise his pay package.
The vote was overruled by Renault’s board, but Ghosn later accepted a pay cut after Emmanuel Macron, France’s economy minister at the time, threatened to step in with a new compensation law.
“Compensation is more scrutinised today than in the past,” Ghosn told The Financial Times in June, but added: “You won’t have any CEO say, ‘I’m overly compensated’.”
The criminal investigation in Japan has reportedly lifted the lid on Ghosn’s globetrotting lifestyle.
Sources have said Nissan funds were secretly used to pay for residences for Ghosn in Lebanon and in Rio de Janeiro.
– ‘Never accept interference’ –
Ghosn spent the first two decades of his career with the French tyre-maker Michelin. After an early stint in his native Brazil, he was quickly promoted and credited with turning around its North American operations.
He was recruited by Renault in 1996 to work alongside then CEO Louis Schweitzer, where he helped restructure the former state-owned carmaker and steer it back to profitability.
Three years later, he was sent by Renault to head the newly acquired Nissan group with the challenge of doing the same thing within two years. He managed it within one.
The performance made him a hero in Japan, where manga comics are devoted to a businessman who claimed to get by on six hours of sleep a night and unapologetically upended the country’s consensual norms.
“A boss has to have 100 percent freedom to act and 100 percent responsibility for what he does. I have never tolerated any wavering from that principle, I will never accept any interference,” he once said.
After restoring Renault and Nissan to sound financial footing — in the process shedding thousands of jobs at each company — Ghosn shifted gears to the future of automaking, by pressing hard to develop electric cars.
More recently he has been focusing on reviving Mitsubishi, which secured a lifeline in 2016 when Nissan bought a 34 percent stake.
– Globetrotter –
Crossing borders and adapting to different cultures were never a problem for the 64-year-old Ghosn.
Born in Brazil on March 9, 1954, to Lebanese parents, he moved aged six to Beirut with his mother and attended a Jesuit high school in the Lebanese capital.
Later he moved to Paris where he picked up degrees at two of France’s most elite colleges.
He speaks Arabic, French, English, Portuguese, Spanish and Italian, and has picked up a working knowledge of Japanese during his hard-charging time at Nissan.
Yet he also maintained his ties with Lebanon, where he has invested in a winery. And he still enjoys support in his ancestral homeland, at least.
Digital billboards appeared around Beirut last week featuring his portrait and the words: “We are all Carlos Ghosn.”
Arrest of auto titan Carlos Ghosn: key dates
Tokyo, Japan | AFP | Monday 12/10/2018 – 04:13 UTC+2 | 401 words
Carlos Ghosn has gone from heading a powerful auto alliance to occupying a Tokyo cell on allegations of financial misconduct. Here are some key dates since his arrest.
– November 19: shock arrest –
Investigators from the Tokyo District Public Prosecutors Office arrest Ghosn just after his private jet touches down at the Haneda Airport.
His right-hand man and close aide Greg Kelly is also arrested.
Accused of financial misconduct, including under-reporting Ghosn’s salary between 2010 and 2015, they are detained for investigation for a period that is extended twice to December 10.
They both deny wrongdoing.
Prosecutors raid Nissan’s headquarters in the city of Yokohama and Ghosn’s luxury Tokyo apartment.
That evening Nissan chief executive officer Hiroto Saikawa says the company had uncovered years of financial misconduct including under-reporting of income and inappropriate personal use of company assets.
“Too much authority was given to one person in terms of governance,” he tells reporters, referring to “a dark side of the Ghosn era”.
– November 20: Renault names interim boss –
After an emergency board meeting, French car giant Renault says Thierry Bollore will take over with Ghosn “temporarily incapacitated” following his arrest.
Bollore, previously the chief operating officer, is appointed deputy CEO with the “same powers” as Ghosn.
Renault launches an internal audit into Ghosn’s pay days later.
– November 22: fired by Nissan
Nissan’s board votes unanimously to “discharge” Ghosn as chairman.
In Paris, the French and Japanese finance ministers, Bruno Le Maire and Hiroshige Seko, reiterate “strong support” for maintaining the Renault-Nissan-Mitsubishi alliance.
– November 26: fired by Mitsubishi –
Mitsubishi Motors executives meeting in Tokyo vote unanimously to oust Ghosn as chairman.
– November 29: alliance affirms unity –
Automakers Renault, Nissan and Mitsubishi Motors reaffirm their commitment to their alliance in the first meeting of company leaders since Ghosn’s arrest.
“We remain fully committed to the Alliance,” the firms say in a joint statement.
Ghosn had been seen as the glue binding together the complex three-way structure which makes up the world’s top-selling auto company.
– December 10: charge looms –
Ghosn is expected to be charged on the initial allegations of under-reporting his salary between 2010 and 2015, with prosecutors also expected to re-arrest him on allegations of further under-reporting in the last three years.
The new allegations will restart the clock on his detention, allowing prosecutors to seek to hold him for another 22 days.