Letter from a Person Who is Concerned about the Nissan Affair:  a View from the Inside of Another Company

As you might imagine I have been besieged by inquiries from the press when I have little knowledge of what is going on, or went on, a Nissan.  I also received this spontaneous email from a friend who is concerned about the Nissan-Ghosn affair.  Having “sanitized” it, with permission I am posting it.  This particular person worked in matters related to legal compliance for 10 years at a major Japanese company.

Dear Mr Benes:

I retired nine months ago and after a long vacation, recently I have finally got around to looking for an outside director or other similar position.

Anyway, I wanted to write because I was floored by the whole Ghosn spectacle.  I am not close to that company, but was astounded that they chose to turn over and have arrested two foreign senior staff (Chairman and his aide) for redirecting assets to his own account “over several years.”  I was floored because:

a)  Neither of them is likely that spiffy at Japanese and would need other staff to prepare the transactions for them.  Indeed even had they been Japanese staff themselves this would have required a certain amount of nemawashi at least the way the companies I am familiar with are now run.  Gone are the days when 10,000 here and 100,000 there can be disbursed at some executive’s personal discretion.
b) Where were the kansayaku during all this.  Either incompetent or complicit.  Nihil est tertium. [no other choice]
c) Where were the outside directors with executive compensation review committees?  Ditto
d) Why were none of the staff whose job it was to stop this or report this kind of thing if they could not and who had been either ignorant or complicit either arrested or brought in for questioning?

I will keep it short.  I am sure you have at least 3 levels of information more than I have and that I am quite wrong about some things.  [Benes: Actually I do not.]   But this is how it looks on the streets and with rumours in the Shukanshi world flying furiously about that this is a coup d’etat designed to drive the French out of the whole operation it looks hideously incompetent and incestuous.  Just like Olympus.  Just like Toshiba.  Things are not getting better.  My uninformed view from the street.  But there is a danger this is how it will be perceived.

I encouraged a couple of reporters who know about such things to pursue the story wherever it leads though no doubt the Japanese press is way ahead.

Anyway, unless a better explanation begins coming out I fear there is a danger that Japan may be looking like it has a rustic parochial throw the foreigners out -by deceit if necessary- tendency at the corporate level.  This after what I felt were some immense changes and improvements in the Japanese business world over the last decade.

I think it is extremely important for Japanese industry that a true and understandable story (whatever that may be) gets told and that the system can be seen to be somehow working properly.  I hope I am fortunate enough to see you join the fray at some point.

I have no particular objective but to express what this whole thing looks like to someone who worked “inside” of a Japanese company for 30 years.  You probably do not need it but if it together with whatever other information you must have is of any use then I am happy.

Best Regards

 

(Posted by Nicholas Benes, who received this email from a friend. )

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