Volkswagen Corporate Failure Case Study
1060 Words
5 Pages
1
MGMT-512
Exam-1: Volkswagen Corporate Failure in 2015
ANALYSIS OF VOLKSWAGEN CORPORATE
GOVERNANCE DEALING WITH EMISSION
SCANDAL
Prepared By:
Name: Nil
Surname: KINIK
ID: 52930
2
Volkswagen which is well-known German car producer became worldwide number one car
producer in 2015. However in September 2015, something went wrong and VW found out
itself in a deep trouble which was named as a scandal and also in media with emission scandal
and became the example of corporate failure. The scandal was occurred as following, the
Environmental Protection Agency (EPA) which is an agency responsible …show more content…
In the sense of corporate governance issues that had missed, the VW case represents a failure
in the context of Corporate Social Responsibility which is a department as a whole and
completely responsible from the respect and clean image of the company by running
departments with this point of view. Such as the case of broken trust of customers and public,
3
manipulation of regulators, social impact on employees. VW’s aim was to satisfy an
advantage over its competitors i.e Toyota by maximizing the sales and profit by this way
being the number one car maker even by using the image of environmentally friendly cars
which is common expectation beginning from the middle level managers going up to board of
members in today’s corporate world. In other words, for VW it does not matter whether its
cars poisoned the planet with 40 times more nitrogen oxide while the main purpose is
becoming the image of world’s leading car maker.
When we looked from the ethics and legal perspective, the VW emission scandal easily finds
place itself in the side of illegal perspective. After diesel emissions scandal, VW profits …show more content…
The main
question mark in their head is about whether this software will affect their car performance or
not. As an action after the scandal, the new CEO and eventually board of directors now
facing a role such as recovering the company’s reputation and financial stability and build
trust among investors and other key stakeholders.
In the context of corporate governance, VW is a publicly listed company, with headquarters in
Germany, which has a double tier system of corporate governance that involves employee
participation. Major shareholders are the family of founder Ferdinand Porsche with 50.7%,
the federal sate of Lower-Saxony and the state of Qatar with 20% stakes each. Public
shareholders hold less than 10% of the shares. In general, this board organization with main
shareholders, strong stakeholders including employees through workforce representatives is
considered to be a good solution to corporate governance and control issues however it seems
that did not work for VW
In my opinion, mainly the people who are working in these CSR departments should be
responsible from their companies’ actions and they should be well prepared for
MGMT-512
Exam-1: Volkswagen Corporate Failure in 2015
ANALYSIS OF VOLKSWAGEN CORPORATE
GOVERNANCE DEALING WITH EMISSION
SCANDAL
Prepared By:
Name: Nil
Surname: KINIK
ID: 52930
2
Volkswagen which is well-known German car producer became worldwide number one car
producer in 2015. However in September 2015, something went wrong and VW found out
itself in a deep trouble which was named as a scandal and also in media with emission scandal
and became the example of corporate failure. The scandal was occurred as following, the
Environmental Protection Agency (EPA) which is an agency responsible …show more content…
In the sense of corporate governance issues that had missed, the VW case represents a failure
in the context of Corporate Social Responsibility which is a department as a whole and
completely responsible from the respect and clean image of the company by running
departments with this point of view. Such as the case of broken trust of customers and public,
3
manipulation of regulators, social impact on employees. VW’s aim was to satisfy an
advantage over its competitors i.e Toyota by maximizing the sales and profit by this way
being the number one car maker even by using the image of environmentally friendly cars
which is common expectation beginning from the middle level managers going up to board of
members in today’s corporate world. In other words, for VW it does not matter whether its
cars poisoned the planet with 40 times more nitrogen oxide while the main purpose is
becoming the image of world’s leading car maker.
When we looked from the ethics and legal perspective, the VW emission scandal easily finds
place itself in the side of illegal perspective. After diesel emissions scandal, VW profits …show more content…
The main
question mark in their head is about whether this software will affect their car performance or
not. As an action after the scandal, the new CEO and eventually board of directors now
facing a role such as recovering the company’s reputation and financial stability and build
trust among investors and other key stakeholders.
In the context of corporate governance, VW is a publicly listed company, with headquarters in
Germany, which has a double tier system of corporate governance that involves employee
participation. Major shareholders are the family of founder Ferdinand Porsche with 50.7%,
the federal sate of Lower-Saxony and the state of Qatar with 20% stakes each. Public
shareholders hold less than 10% of the shares. In general, this board organization with main
shareholders, strong stakeholders including employees through workforce representatives is
considered to be a good solution to corporate governance and control issues however it seems
that did not work for VW
In my opinion, mainly the people who are working in these CSR departments should be
responsible from their companies’ actions and they should be well prepared for