According to preliminary findings of an investigation into the surveillance, Nissan (7201.T) installed a camera surveillance system at the home of former executive Ashwani Gupta so the automaker’s internal security team could monitor him, two people with knowledge of the report said.
According to a report from Reuters on Saturday, Nissan has been looking into a claim that its chief executive, Makoto Uchida, monitored the company’s second-in-command in order to gain leverage to have him fired for opposing some of the terms of a new partnership agreement with Renault (RENA.PA). Gupta is alleged to have been against some of the terms of the agreement.
Directors of Nissan received a briefing on the preliminary results of the investigation into the U.S. surveillance claim. law firm The two people stated that Davis Polk & Wardwell attended a board meeting on June 20 at the company’s Yokohama headquarters.
According to the people, Nissan had two sets of security cameras installed at the entrance to Gupta’s home in Tokyo’s Shibuya district, according to the preliminary report.
According to the two people, it claimed that the first system was set up for use by a private security company and the second system was set up for access by Nissan’s internal security team to keep track of Gupta.
According to the American report. law firm did not offer a finding on whether the use of cameras by The two people claimed that it was illegal for Nissan to monitor Gupta and that the company did not specify whether Gupta was informed of the monitoring.
When the cameras were installed and who the private security company was were both unknown to Reuters.
On June 20, Uchida and Gupta, who were still Nissan directors and the company’s COO, were excused from the board meeting. According to the two people, a final report on the investigation, which got underway in late May at the independent directors of Nissan’s request, would likely be available by the end of July.
Nissan refused to make any of the executives available for comment and stated that it was unable to comment on ongoing investigations.
A request for comment from Davis Polk received no response.
Surprise Departure
Akira Takeuchi, a lawyer and certified fraud examiner in Tokyo, stressed that he was speaking generally and not specifically about Nissan when he said that under Japanese law, a company can monitor communications on company phones and computers and investigate an employee’s behavior outside of work in order to protect its business interests.
According to the two people, the preliminary findings did not reach a conclusion regarding the assertion made by senior adviser Hari Nada in a letter to Nissan’s independent directors that Uchida had participated in the surveillance.
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Gupta, 52, was set to leave Nissan on June 27—the day of the automaker’s annual shareholder meeting—to pursue other opportunities, the automaker said earlier this month.
Nissan had announced in May that Gupta, who had served as chief operating officer since 2019 and was widely regarded as a potential successor to Uchida, would not be reappointed to the board.
In his letter from April, Nada claimed that during the week of April 10, Nissan reviewed the claims made against Gupta’s behavior and that he had been asked to resign. This was related to a claim of harassment made against Gupta by a female employee, according to three people with direct knowledge of the situation.
Nada requested that a foreign law firm be hired to look into the surveillance of Gupta in his letter. Additionally, he suggested that the law firm investigate the circumstances surrounding the Gupta conduct investigation, including whether the outcome was predetermined and Uchida’s involvement.
According to the sources, Davis Polk informed Nissan directors in its report that the audit committee appeared to have acted arbitrarily in taking up the Gupta complaint in the manner that it did.
New Board
According to one of the sources, the Japanese law firm Iwata Godo expressed an opinion on the more specific issue of whether the audit committee’s actions were legal in another report about the allegations against Gupta’s conduct that was given to the board.
The person said that according to Iwata Godo, there was no proof that the committee or its chairman, Motoo Nagai, had handled the complaint against Gupta in an unlawful manner.
Nagai was also excused from last week’s meeting where the allegations of surveillance and harassment were discussed. He was not made available for comment by Nissan.
A request for comment from Iwata Godo was not answered.
Reuters was unable to ascertain whether either law firm had reached a conclusion regarding the harassment claim itself, other than how it was handled. Nada wrote in his letter that he believed the claim had been looked into by the Japanese law firm Anderson Mori & Tomotsune.
The firm Anderson Mori & Tomotsune has declined to comment.
Nissan and Renault announced the details of a new partnership in February, whereby the Japanese automaker would acquire up to 15% of an electric vehicle division that Renault was spinning off, and the French automaker would decrease its 43% ownership of Nissan.
According to a person familiar with Renault’s thinking, senior executives at the company had believed Gupta was delaying or preventing the conclusion of the new alliance deal.
Ten directors, including Uchida, were chosen by Nissan shareholders on Tuesday to serve on the board. Gupta showed up for the meeting on his final day working for Nissan.
When a shareholder questioned Gupta about his time at Nissan, Uchida responded on his behalf by stating that the executive had made a significant contribution to tasks like the company’s strategic plan.
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Source: Reuters
