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Rennault all set to cancel almost USD 34 million perks to former director Carlos Ghosn

Rennault all set to cancel almost USD 34 million perks to former director Carlos Ghosn
Image Credit: Wikimedia

The board of Renault was poised to cancel as much as 30 million euros ($34 million) in deferred pay and severance to its ousted boss Carlos Ghosn, as directors met on Wednesday to approve its full-year accounts, sources told Reuters. Renault will scrap around 460,000 performance shares attributed to Ghosn since 2014-15 and now worth 26 million euros, under proposals backed by the French government, its biggest shareholder, two people familiar with the matter said.

The board is also likely to drop a two-year non-compete clause worth 4-5 million euros to Ghosn, who was forced out in January following his arrest in Japan for suspected financial misconduct at Nissan, Renault's alliance partner. A Renault spokesman did not immediately return calls and messages seeking comment.

Ghosn, 64, was arrested in Japan and ousted as Nissan chairman last November and has since been indicted along with Nissan and a fellow director for failing to disclose more than $80 million in additional 2010-18 compensation that he had arranged to be paid later. Ghosn denies the deferred pay was illegal or required disclosure. The scandal, triggered by a Nissan internal investigation, initially strained ties with 43.4 per cent-owner Renault as the French carmaker continued to back Ghosn until he was eventually forced to resign last month.

Renault appointed new Chairman Jean-Dominique Senard on Jan. 24 and last week passed evidence to prosecutors that the company had paid part of Ghosn's 2016 Versailles wedding costs, in a first case of his suspected misconduct at the French carmaker. Ghosn's representatives say he was unaware the 50,000 euro rental had been charged to Renault and now plans to repay it.

The proposal to scrap most of Ghosn's severance package was drawn up by Renault's remuneration committee and is unlikely to be rejected by the full board, the sources said. Left intact, his golden parachute could have been politically explosive in France, where President Macron is battling "yellow vest" street protests over low pay and inequality.

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 on Wednesday. "We've always been against excessive pay," the official said. "It's not about the presumption of innocence but ethics and decency." ($1 = 0.8827 euros)

(With inputs from agencies.)

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