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Volkswagen scandal

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Guest eyoismos

Volkswagen’s ‘uniquely awful’ governance at fault in emissions scandal

 

 

Volkswagen's decision to nominate a long-serving executive as chairman has once more highlighted the carmaker's corporate governance and culture, which some experts argue were a root cause of the diesel-emissions scandal.

Top directors on Thursday announced that Hans-Dieter Pötsch, VW's chief financial officer since 2003, would become chairman in the coming weeks, filling the spot vacated by patriarch Ferdinand Piëch, who resigned in April.

Hans-Christoph Hirt, a director of Hermes Equity Ownership Services, an adviser to pension fund investors in companies including VW, said the appointment created a "serious conflict of interest".

 

"[Pötsch] was a key VW executive for more than a decade and under German law the management board has a collective responsibility . . . The lawyers will surely demand that he recuse himself from any supervisory board meetings when management's role is discussed," Mr Hirt said.

 

VW's response has been compared with the way Siemens dealt with a huge bribery scandal in 2006. For the first time in its 150-year history the German engineering conglomerate appointed an outside chairman (Gerhard Cromme from ThyssenKrupp) and chief executive (Peter Löscher from Merck in the US).

 

Together they transformed Siemens' culture and Mr Cromme took legal action against former Siemens executives for not stopping the bribery. "How is Mr Pötsch supposed to do that?" said Mr Hirt.

 

VW has admitted installing software in engines over several years so they passed laboratory emission tests but belched out dangerous nitrogen oxides when on the road. Martin Winterkorn resigned last month as chief executive, insisting he knew nothing of the cheating, which analysts fear could cost VW billions of euros in fines, lawsuits and recall costs.

 

 

Assisted by a US law firm, VW has launched an internal investigation and reported the wrongdoing to prosecutors.

However, governance experts argue the cheating was predictable because of VW's lax boardroom controls and peculiar corporate culture. "The scandal clearly also has to do with structural issues at VW . . . There have been warnings about VW's corporate governance for years, but they didn't take it to heart and now you see the result," says Alexander Juschus, director at IVOX, the German proxy adviser.

 

Even before the diesel scandal, VW's shares traded at a discount to other carmakers partly because of governance concerns.

 

A former chairman of a large German industrial company says "Germany has corporate governance problems but VW has long been uniquely awful".

 

A key weakness at VW remains the lack of diversity of opinion and expertise on the company's supervisory board, experts say.

 

The 20-member council of directors — whose membership is equally divided between shareholder and worker representatives — is responsible for hiring and firing executives, providing advice to management and monitoring their actions.

 

Yet 17 of the 20 members are either German or Austrian and the board of directors has only one truly independent voice — Annika Falkengren, chief executive of Swedish bank SEB.

 

 

The German carmaker is engulfed in the worst scandal in its 78-year history after it admitted to manipulating emissions test data on its diesel vehicles in the US and Europe.

 

Many of the remaining directors are representatives of the three largest shareholders — the Porsche and Piëch families, the State of Lower Saxony and Qatar.

 

In 2012 VW appointed Ursula Piëch — a former kindergarten teacher and the wife of Mr Piëch — to its supervisory board. Both have since resigned.

 

"VW's supervisory board is short of people with relevant experience and skills and — significantly — independence," Mr Hirt says.

 

External investors have only 12 per cent of the voting shares and therefore "can't change anything", according to Mr Juschus.

 

Directors at other German companies often meet investors but their access to Mr Piëch was very limited.

 

It wasn't always that way. Ten years ago VW's supervisory board still boasted external luminaries including Mr Cromme, the author of Germany's corporate governance code.

 

But Mr Cromme quit VW's board in 2006 when Mr Piëch used votes from workers to push through a trade unionist as head of personnel, against the wishes of some shareholder representatives on the board.

The influence of employees at VW remains far greater than at any other big German company.

The carmaker's response to the diesel scandal emissions crisis has been steered by a small committee of top directors and three of the five members are labour representatives.

 

Ferdinand Dudenhöffer, automotive expert at the University of Duisburg-Essen, describes Bernd Osterloh, VW's chief labour representative, as a kind of "co-manager" who now "dominates the supervisory board".

 

Because of a lack of suitable candidates among the shareholder representatives on the board, VW's interim chairman is Berthold Huber, a former head of the IG Metall trade union.

 

Although these cosy relations have some advantages — in times of crisis, management can more easily get the backing they need to push through changes such as cost cuts — critics say they represent a Faustian pact in which managers protect German jobs, in return for support.

 

VW has almost 600,000 employees but its management board is staffed entirely by men. Under Mr Piëch and Mr Winterkorn, decision-making at VW was highly centralised and more junior managers were frightened to speak their mind.

 

In the aftermath of the diesel-emissions scandal, Mr Osterloh has urged VW to create a culture where problems are "not concealed but are openly communicated to superiors".

 

Following his appointment as VW chief executive, Matthias Müller pledged to "develop and implement the most stringent compliance and governance standards in our industry".

 

Others recall that previous crises at VW — including a prostitutes and bribery scandal in 2006 — did not deliver real reform. "If VW doesn't change now then they will never do it. It really depends on the three big shareholders — whether they are willing to reform," Mr Juschus says. "I have my doubts."

 

source: -> http://www.cnbc.com/2015/10/04/volkswagens-uniquely-awful-governance-at-fault-in-emissions-scandal.html

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Guest PatrickT

you do realize that there is a diference between derogatory and racist remarks?

oh wait ...on the other hand we could quite easily saying exactly what about all your constant vile accusations and statements ?

oh thats right ... becuase it came from you, it doesnt count

 

and then you wonder about why i constantly call you a mounopano

 

for your info, there are krauts, and there are germans, (proud germans, humble germans, industrious germans, respectifull germans, who dont lie and cheat, and constantly try to humiliate and belittle and try to show they are nazi/stazi affiliates) ... and you have consistently proven to be part of the former group

 

so yeah .... KRAUT car, as the one you have

 

and for the record, i have way more than one car .... because i can afford it, and can afford them to be parked while i wonder which one to use the following day .... and i have got rid of all the german ones

 

as one ancient greek once said .... best to hide your ignorance, than to display it to the world

 

You did buy the german cars. The deal is done, the money was transfered. What you do now is irrelevant. 

 

As for the rest of your rant, I dont know what you smoke but you should stop using it

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Guest eyoismos

oh what a naive fool you are..... you honestly think money is made from a sale of a german car? seriously? and all this time i thought it was excessive costs on spares and services  .... my bad

 

as for my smoking .... well .... actually its breathing .... that shit that comes out of german diesels

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Guest PatrickT

Like you would understand that topic. Even with that device the emission levels are way lower than that of any competitor. 

 

Beside that, whats your problem old men? The only thing you wait for in your life is your death. 

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Guest eyoismos

wow ! i must be really getting through to you for you to come up with that  worthy of an oxymoron

 

but not to worry.... by all accounts i have a good 20 years still left to piss the hell out of you

 

looking forward to that too :lol:

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Guest PatrickT

The VW issue is a problem. And one grows when you overcome a problem. The workers at VW do an amazing job and VW is for many people, not only in germany, the greatest car producer in the world. Some managers did a crime that was based on a false leading structure and that was wrong. The current problems are big. VW faced a dramatic loss at the stock exchange and faces alot of insecurities.

 

The new management will do evrything to solve those problems and in the end not only VW but our nation as a whole can change this problem into a chance. VW leads worldwide with alternative motors and systems but they are a freak show because most people don´t want them. This scandal can give us the opportunity to change that. Fossil fuels wont be here forever. 

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Guest eyoismos

oh? you mean like hybrids and electrical cars... and all this time i though the japs had it all wrong by putting in so much effort in them ... my bad .... NOT

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Guest PatrickT

oh? you mean like hybrids and electrical cars... and all this time i though the japs had it all wrong by putting in so much effort in them ... my bad .... NOT

hybrid cars were developed in germany but never really pushed. VW leads with electrical cars in evry aspect. Be it the e-up, eGolf or BMW i3 and i8 as well as the Audi eTron. Germany also developed the fuel Cell car and experiemnts with it.

 

hybrids btw are a smokescreen and save nothing.

 

and what are japs? Thats. racist word. Do you call africans niggers as well?

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Guest eyoismos

oh my lord ...that coming from you of all people ... and i better requote before you delete that as well so you have viable deniability, as you always do

 

the only babies born there are africans and pakis. so far the only way britain and france know is downwards.

 

for the record ... you are not of japanese minority status in the states, to find offense or to give lessons of racism avoidance

the japanese use that term freely, in japan and wherever they go.. i have come across many a person from japan visiting these parts that use that term when a particular circumstance arises

 

and the word nigger is not used so much in its derogatory form in these parts of the world. if anything... BECAUSE they haven a clue what its all about, the locals often use it because its cool and they are prety much wannabes of black americans - i have lost count of how many times local guys that i deal with refer to me as " my nigga" in their every day speech without thinking  ...and i mock them for it

 

you wanna piss the local off? call them a kaffir and they are ready to cut throats...ask them what that means and they haven a clue... the just know the colonials called them that.... then i proceed o mock them as well ...for it means "non-believer" in arabic, or "one without religion" from its islamic sense of what everybody else is ... and technically i am a kaffir too ...and every time i do that they are ...well... disbelief comes to mind -  the point being it took the colonials to usurpe the word, any word for that matter,  and make it mean something else ...supposedly to their advantage

 

in the uk you talk about a fag, it means a cigarette, in the "new world" it means "faggot"

in the us, you talk about fanny , and you are referring to buttocks, in the brit and most of its colonies ..well... lets just say patting a fanny would be construed as as a sexual assault on a female :-P

 

and there are so many other examples

 

but no matter what and which way you swing it .... you will always universally be associated with ......mounopano - its your legacy

 

and yeah .... jap cars ROCK .... why? because the are normally honest and honor is taken seriously

 

two of my cars are jap cars, one of them is hitting 20 years soon and still going strong

a friend of mine has a datsun 120Y (you know ...from noah's days) and refuses to part with it. its shell might be a total rust bucket, but the rest of it refuses to die - still on the road too

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Guest eyoismos

to be honest, i fail to see how such a movie can be completed, when we still dont know where the whole is going

 

but then hollywood is always knows for the art of bullshit, and always looking to have a "bad guy" for audiences to vent their frustrations at

 

...hell .... i still remember, from the old days, when the might ducks has to contend with the evil icelanders ...and of course .. as usual ,.... the yankees came out in the end sweet as good old American pie

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Guest FriendofGreece

I think they have not written the book yet. There is still time to add information as they come. Announcing the movie just builds up free publicity.

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It's going to be years before all legal battles are done. Also, I see no real story here. What would the story line be? Crooked German business people cheated the world to make more money? Not much of story there... :D

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Guest PatrickT

The new Phaeton will be electrified. Thats big and great news and i see it as very positive that this high end car opens up a new market in that segment. Even more so since its build in Dresden

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Guest FriendofGreece

The article said that Leonardo is a big environmentalist, so who knows what he is thinking to do with the story. Anyhow, do Leonardo fans really need a deep storyline to watch his movies?

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Guest eyoismos

The name Phaeton derives from Phaëton, the son of Phoebus (or Helios) in Greek mythology, by way of the phaeton auto body style and the type of horse-drawn carriage that preceded it.

 

trust volkswagon to turn to the greeks to find their mojo

 

:D

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Guest PatrickT

trust volkswagon to turn to the greeks to find their mojo

 

:D

 

No, to european history and hellenic history. Phaeton has nothing to do with your turko-osmaic ancestors. 

 

VW would turn to the greeks if it would chose some old turkic god as name, which it did not. 

 

Germans and Hellenic people share one common ancestor, which can be traced back 10.000 years ago (proto indo aryan). But we don´t share any connection with your turkish and arabic ancestors. 

 

Living on the land doesn´t make you hellenic. You have as much in common with old greece as Paris Hilton has with Pocahontas

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Guest eyoismos

No, to european history and hellenic history. Phaeton has nothing to do with your turko-osmaic ancestors.

 

VW would turn to the greeks if it would chose some old turkic god as name, which it did not.

 

Germans and Hellenic people share one common ancestor, which can be traced back 10.000 years ago (proto indo aryan). But we don´t share any connection with your turkish and arabic ancestors.

 

Living on the land doesn´t make you hellenic. You have as much in common with old greece as Paris Hilton has with Pocahontas

ω θεέ μου ... hysterical2smiley-1.gif το μουνόπανο ανακάλυψε τις σκοπιανές ιστοσελίδες

 

άσε ...δεν πειράζει .... αφού το τσόκαρο ξεχνά εύκολα που οι πρόγονοι ήταν σπερματοκουβάδες για τους μογγόλους

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You continue provoking users in this forum whenever they post something against Germany or against some German company. You called us "Christian Turks" and eyoismos retaliated with a Greek swear. Nothing wrong with it. If you don't want people swearing at you then stop provoking them.

 

As you can see I didn't delete your insults (you also talk about Greek being a "dead language" in a later post), the same way I'm not going to delete eyoismos' insults. I don't need to remind you, one more time, that this is a Greek and not a German forum. You're obviously welcome here to post your opinion about anything, but if you expect respect then you should show respect to this website and to this forum and its users.

very well said Admin  :)

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I think that the Germans take these things seriously and some heads are going to roll. Despite all the fun we poke here, you have to agree that the Germans have the mechanisms in place to find and punish the culprits of this scandal.

If this would have happened in Greece, Italy, Turkey or some other Mediterranean country I'd be pretty certain that there would be massive cover ups.

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