Nissan shareholders assail management over deepening crisis
TOKYO :Nissan Motor shareholders vented their frustrations over the automaker's poor performance at its annual general meeting on Tuesday, with some demanding greater management accountability for the deepening crisis at Japan's third-largest car company.
The meeting was the first for new boss Ivan Espinosa since he replaced Makoto Uchida as CEO in April. It remains to be seen whether Espinosa, a company veteran, will be able to halt the sharp decline at Nissan.
Shares have fallen some 36 per cent over the last year and dividend payments have been suspended. Nissan reported a $4.5 billion net loss in the last financial year and there is no guarantee it will return to profit this year - so far, it has declined to give a full-year earnings forecast, and has estimated a first-quarter loss of 200 billion yen ($1.38 billion).
All the same, shareholders voted down a number of proposals that the company had opposed, including an activist-shareholder proposal that would have forced Nissan to take action on listed subsidiary Nissan Shatai.
Espinosa has laid out plans for big cuts, including closing seven plants and shedding a total of 20,000 jobs, or around 15 per cent of Nissan's workforce.
One shareholder accused the board of trying to "shift its responsibility to frontline workers" by cutting jobs while retaining their own positions. The board should likewise face a shake-up or risk losing the trust of shareholders and company employees, the shareholder said. Another shareholder complained about the cut to the dividend.
Tokyo-based activist shareholder Strategic Capital had pressed Nissan to take action on its listed subsidiary as part of its overhaul.
While that proposal was defeated, the breakdown of the vote won't be known until later.
Japanese companies are under increasing pressure from the Tokyo Stock Exchange and regulators to clear up so-called "parent-child listings", which are seen as unfair to minority shareholders and a drag on governance.
In one prominent example, Toyota Motor this month unveiled plans to take private its listed subsidiary, Toyota Industries, in a complex, $33 billion transaction that some shareholders have said undervalues the forklift operator.
Toyota likely took action because "it felt pressure from shareholders and thought it had to change," said Tsuyoshi Maruki, the chief executive of Strategic Capital, in an interview with Reuters on Monday.
He said he hoped Nissan's management could also give the issue similar consideration.
Nissan owns 50 per cent of Nissan Shatai, which manufactures cars for the automaker. Strategic Capital owns 3.5 per cent of Nissan Shatai. It has also acquired a small stake in Nissan, allowing it to submit proposals to the general meeting.
It has proposed that Nissan change its articles of incorporation so that it would be required to annually examine its relationship with listed subsidiaries and disclose what action, if any, it planned to take.
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