TOKYO -- Two leading proxy advisory firms have urged Nissan Motor Co. shareholders to vote against the reappointment of CEO Hiroto Saikawa, heaping more pressure on embattled executive as he struggles to find accord with alliance partner Renault.
The move marks a rare public rebuke by international proxy firms against the leader of a top-tier Japanese company, and comes just as the scandal-hit automaker struggles to move on from the legacy of Carlos Ghosn, its ousted chairman who stands accused of financial misconduct.
It also underscores the precarious position of Saikawa, 65, who was groomed for leadership by Ghosn but appears unable to mend a relationship with Renault that one source said appeared to be in jeopardy.
Institutional Shareholder Services recommended shareholders vote against Saikawa as director at Nissan's annual general meeting on June 25, to ensure a "clean break" from the Ghosn era. Ghosn, first arrested in November, is awaiting trial on financial misconduct charges. He denies all the charges against him.
"When the company needs to break from the past and build a strong board with fresh members, the reelection of Hiroto Saikawa, who has been on the board for 14 years and worked closely with Carlos Ghosn, does not appear appropriate," Institutional Shareholder Services said in a research note.
The firm also advised shareholders to vote against the nomination of Moto Nagai to Nissan's board, saying the former executive of Mizuho Financial Group served as an independent auditor at Nissan during Ghosn's tenure, and "shares responsibility" for failing to exercise oversight of Ghosn's alleged wrongdoing.
Another proxy adviser, Glass Lewis, similarly told shareholders not to vote for Saikawa, who needs the support of at least half of voting shareholders at the meeting to be reappointed.
"We cannot confidently support the nomination of Mr. Saikawa who - as the representative director and president of the Company - should have taken greater steps in performing its oversight responsibilities in the misconduct of the board members," it said in a report to clients.
Asked about the ISS and Glass Lewis reports, Saikawa said: "I believe I should follow through with my responsibilities and I hope my stance is understood."