Dieselgate could not happen again, VW executive claims

Scandals such as “Dieselgate” could no longer pass undetected at Volkswagen due to the strengthening of compliance and complaints procedures under the guidance of a US court-appointed monitor, the German carmaker said on Monday.

“A company the size of Volkswagen, with 670,000 employees, probably will have issues in future,” Hiltrud Werner, VW’s board member responsible for integrity and legal affairs, told the Financial Times, but she added that “fraudulent activities, I’m absolutely certain, cannot creep into processes and the organisation for 10 years as it was with [Dieselgate]”.

Ms Werner’s comments come as Larry Thompson, a former deputy attorney-general in the George W Bush administration who prosecuted Enron officials, concluded his stint as independent compliance monitor at the world’s largest carmaker.

“Volkswagen is a better organisation today than it was three years ago,” said Mr Thompson, who was appointed to the role as part of a US consent decree, but he warned that “continued vigilance” would be required to prevent further wrongdoing.

The diesel emissions scandal, which came to light in 2015, forced VW to admit to installing software in 11m vehicles that could manipulate nitrogen oxide tests.

The scandal has already cost the manufacturer more than €32bn in legal fees, settlements and compensation, a similar sum to VW’s investment package into electric vehicle technology.

However, despite admitting to wrongdoing in the US, and Germany’s Federal Motor Transport Authority declaring that the software installed was a “defeat device”, VW has always denied fraud in Europe, where it was forced to recall millions of cars.

Ms Werner, who joined VW’s management board in 2017, said a new “speak-up culture” would make it easier for employees to bring wrongdoing to the attention of the company’s compliance department, which has grown from 30 people to 130.

She added that approximately 2,000 reports come through VW’s whistleblower service each year, of which 60 to 70 turn out to be notifications of “serious violations”, including breaches of labour law and environmental law.

The former BMW executive also insisted that with the introduction of a new code of conduct, “everyone knows what the company stands for”, and that if there was an ongoing scandal, such as human rights abuses somewhere in VW’s vast supply chain, it would be flagged.

The carmaker has repeatedly defended its decision to continue to produce cars in the Chinese region of Xinjiang, which is home to so-called “re-education” camps, in which more than 1m Muslims, mostly Uighurs, have been detained.

Earlier this year, VW was forced to apologise for the publication of an apparently racist Golf 8 advertisement, which the company blamed on a lack of “intercultural sensitivity”. 

Ms Werner said that VW’s 20-person supervisory board needed to be more diverse, and include a representative from Asia, which is the group’s largest market.

“A company like Volkswagen probably should have an expert on energy supply in the board room and a digital expert,” she added, arguing that the Wolfsburg-based auto giant needed more people at the top who would ask “uncomfortable questions”.