Case Study Of Swagen Emissions Scandal

Volkswagen is one of the largest automakers in the world and it has a global reputation as a high-quality German auto brand. Social responsibility is included in VW’s corporate culture and it seems that Volkswagen made some advances in Corporate Social Responsibility because the corporation was ranked 11th 2015 in the Global CSR Rep Track 100, which listed companies by reputation (Reputation Institute, 2015).However, the company has been threatened by an emission scandal which broke in September 2015, when the Environmental Protection Agency (EPA) disclosed that Volkswagen had installed defeat devices on diesel cars which were sold in the US. These devices equipped on VW cars cheated regulators in such a way that it could detect

The mistrust between the Volkswagen Company and their customers developed after the scandal associated with the incorrect emission of data and cheating of the system unfolded.  The scandal occurred on the eighteenth of September 2015 when it was found that the company had made a car with a turbo that released emission directly into the real word atmosphere. The allegations were genuine and were proved by the Environment Protection Agency in the United States (EPA) (Hotten, 2016).The chief

Volkswagen is under investigation following reports from the EPA that they had installed software into their engines that deceived emissions testers. Furthermore, engineers updated this software in 2014, claiming that they were improving the vehicles. James Liang, a senior engineer who had worked for Volkswagen for 30 years, admitted to investigators in September of 2016 that he had designed the software in question. Further investigation has revealed that this conspiracy may have involved executives of the company. It is unknown to the public whether Liang was acting under orders when he designed the software or he decided to create it on his own to meet requirements his superiors gave him. Both rule utilitarianism and Kantian duty ethics

The company had a lot of pressure to get their diesel vehicles on the road which were advertised as having low emissions and being overall better for the environment. Volkswagen created a ‘defeat device’ which allowed them to cheat their way through the emissions test and get their vehicles on the road quickly without having to address the issue. When they were caught, the company admitted to having over 11 million cars world-wide containing this device and were releasing emissions up to 40 times the legal limit in the United States. Volkswagen planned on recalling some of the vehicles privately before the scandal was revealed, but once it was found out, all the cars were reimbursed but the company also had to pay fines for each car that violated the standards (Hotten, 2015). While the company did experience quite a financial loss as a result of this large-scale scandal, no individual people were punished or convicted of anything due to the fact that it is nearly impossible to pinpoint who is at fault. Due to the fact that they are a large, relatively wealthy company, they figured it would be easy for them to get away with what they did, because of the way white-collar crimes are approached by the criminal justice system. Had a company or individual of lower economic status tried to attempt a similar crime, the punishments would have been more severe and individual persons would have been picked out and punished for the crimes committed, likely resulting in job loss or

More and more corporate scandals are happening in America. Why have these scandals just shown up in recent years? What causes these corporations to lie and be deceitful towards investors? Though once seen as legitimate, fair, honest, and respectable, corporations have arrived at a stage of greed and deception. This can be explained by a number of factors such as how the stock market works, the stock market boom, changing company practices, CEO benefits, and specific company examples.

Volkswagen company put sensors in the emission component, so when tested, the examiner sees that the car meets emission standards. But because the sensors are to meet U.S emission standards, the car itself can be modified to ignore the sensor’s override and make the car believe it was in use. TFL motors was curious about the scam, so they decided to put a Jetta TDI turbo diesel on an AWD Dyno, to confuse the car into thinking it’s on the street, not being checked for emissions. Being in emissions mode, the AWD dyno lost horsepower and torque, but without the sensors active the car produced excess diesel exhaust, going over the EPA regulated limit. The car itself was able to perform at a higher level without the sensors active, proving reason to hide the fact that excess exhaust is produced. Certain companies realize the regulations hold their products back, so to promote the fuel efficiency and or horsepower of the car, they would gladly hide the fact that their cars are emitting excess diesel exhaust. Some ways to prevent excess exhaust would be to install EGR coolers, or to buy tuners for your engine’s valves. But many professional truckers tend to stick with rolling coal. “Rolling coal” can happen by making a smoke switch, or removing emission controls on truck models, and adding a tuner to produce fine smoke build ups. Diesel exhaust is actually less harmful then a

During the late 1990s and early 2000s, several companies like Enron, WorldCom, Adelphia, Global Crossing and Tyco, just to name a few, were embroiled in corporate fraud, greed and manipulation. These businesses were intentionally deceiving the public, their investors and even their employees. Company executives were hiding company expenses and liabilities, misreporting company finances in order to increase stock prices. External audit agencies that were hired to examine and certify financial statements for accuracy, were basically

Volkswagon was caught cheating on their diesel emissions by a man named Daniel Carder and his small research team at West Virginia University in late 2012 through May 2013. The team consisted of a research professor, two graduate students, a faculty member and himself. Their team originally wanted to investigate emissions to help the diesel cars in Europe. There has been much data suggesting vehicles in Europe have high nitrogen oxides and dioxides. The goal was to look at emissions in the U.S. where the emission standards were very strict. It was thought that if the cars were found to be clean, then they could take the data results to Europe, and say “why can’t you do the same in Europe?” The small research team had been granted $50,000

As a multinational corporation, the implication of the scandal determines the fate of numerous stakeholders both internal and external. Internal stakeholders comprise of the board, managers and employees while external stakeholders subsume shareholders, customers and suppliers. The economic, political and social impacts of the dishonest practices would shape the fate of Volkswagen and affect the future prospects of the automotive industry. Common shareholders whilst not involved in the day to day running of the business placed faith and belief in the firm by providing capital had suffered severe economic loss as share prices (get something for stat). Despite the callous deception in advertising the defeat device displayed no signs of disturbing vehicle performance, however, customers of Volkswagen and its subsidiary vehicles suffer from lower resale value. In addition, even though the scandal was global, European consumers were the most affected with diesel cars accounting for 41% of all European cars (Fontaras, 2016). This high percentage in respect to other nations is a result of incentives provided by the European Union for the purchase of diesel vehicles such as subsidies towards the production process resulting in lower premiums compared to petrol counterparts (Vidal, 2015) In additional with sales falling suppliers of Volkswagen would likely lose future contracts or have current contracts downgraded as less parts are required. Thus, this loss of future

In conversations globally the environment is a hot topic. Issues with the ozone layer, depleting natural resources, and health risks associated with emissions and changes in climate coupled with its resulting natural disasters; have pushed conservation issues into the spotlight. The environmental issues presented today are not the result of one country, one type, or one-industry actions but a communal failure of a mixture of several. With that said many countries and industries are going through policy changes to combat environmental issues that will hopefully benefit the environment, the consumer, and industries.

Companies betrayed their employees, consumers, supplies, shareholders, and the government by using unethical techniques and being dishonest to keep their company on top. For example, Volkswagen Company is now in a business ethical dilemma, because the company wanted their latest cars to pose as a diesel friendly. In 2015, “the Environmental Protection Agency (EPA) found that many Volkswagen cars being sold in America had a defeat device or software in diesel engines that could detect when they were being tested, changing the performance accordingly to improve results. The German car giant has since admitted cheating emissions tests in the U.S. VW has had a major push to sell diesel cars in the U.S, backed by a huge marketing campaign trumpeting its cars’ emission. The EPA’s finding cover 482,000 cars in the US only, including the VW-manufactured Audi A3, and the VW models Jetta, Beetle, Golf and Passat. But VW had admitted that about 11 million cars worldwide, including eight in Europe, are fitted with the so-called “defeat device” (Russell Hotten).” “Volkswagen had been intentionally and scandalously cheating on their nitrogen oxide (NOx) emissions for

At 18th September 2015, The Volkswagen has charged by the US government of using the software which has been defined as a “defeat device” by EPA to hide emissions testing for certain air pollutant on almost a million of its cars. “The VW cars under investigation emit up to 40x the national standard for nitrogen oxide, which is linked to asthma & lung illnesses,” posted by the U.S. EPA in Twitter. According to the test, the nitrogen oxides that have emitted by the Volkswagen product is 10 to 40 times of the permissible level of 70 milligrams per mile which will seriously damage our

The people at the West Virginia had tested vehicles as well as the EPA (Patel). Volkswagen chose to include rout programming device to cheat the system to pass the testing laws. Volkswagen as a corporation was basically trying to cut the cost of engines to be built by limiting the NOx emission system that controls how much dirty chemicals that goes into the air (Patel).By the company putting this device in their cars they were trying to cut down the cost that they would have to spend, at the same time Volkswagen cars had better performance. The ethical question would be is it really worth it to CHOSE to overlook the laws to save money on cash (Patel). "We expected better from Volkswagen," said Cynthia Giles, the E.P.A's. colleague manager for the Office of Enforcement and Compliance. She called the automaker's activities "a danger to general health of our

It is not hard to see that the scandal would cause a horrid blow to VW’s image. Until the incident, VW had, like many other German companies, the reputation of “German engineering” (Robertson, 2013). However, instead of using that innovation to develop diesel-fueled cars compliant with U.S. standards, it decided to try to scam its way in the market. Not only did the company admit to having 11 million cars with software intended to cheat tests (Gates, Ewing, Russell & Watkins, 2017), it also plead guilty to “destroying evidence in an elaborate cover-up” (VW Admits Emissions Cheating and Cover-up, 2017); building further distrust among its consumers.

It seems like business morals and ethics are being whisked to the side in lieu of the ever growing demand of higher stock prices, rising budget goals and investor profits. Despite the increased regulation of corporations through legislation, such as, Sarbanes-Oxley, some corporations still find themselves struggling to maintain ethics and codes of conduct within the workplace. In reviewing the failings of the Enron Scandal, one can heed the mistakes that both individual and organization malaise, such as, conflicts of interest, lack of true transparency and the sever lack of moral courage from the government, executive board, senior management and others, contributed to the energy giant’s downfall.