Utilitarian Analysis : The Volkswagen Dilemma

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

Kantian ethics and rule utilitarianism disagree on the morality of creating a “defeat device.” This device determined when its engine was undergoing emissions testing then switched from its normal operating mode into a lower emission mode. The normal emission mode was 40 times the limit dictated by the Clean Air Act [1]. By creating a dirty engine, Liang contributed towards the destruction of the atmosphere. This will negatively impact the quality of life for many future generations of people. Because damaging the environment negatively impacts millions of people, rule utilitarianism declares it to be morally wrong. The prosecution of six executives of Volkswagen, including the head of engine development, indicate that Liang’s superiors were involved in this conspiracy from the beginning [2]. The most applicable maxim to this situation is “I shall fulfill

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

2015 was not a banner year for the car manufacturer, Volkswagen. In September, the Environmental Protection Agency (EPA) found that many VW 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 (Hotten 1). It was found that the defeat device altered the emissions of the Volkswagen’s diesel engine; the defeat device software had the capability of sensing if it was in a testing situation or driven normally. In the test environment the software would function properly to provide the expected test results and then revert back to unsafe emissions levels. As a result, the EPA issued notice of violation to Volkswagen on September 18, accusing the company of installing a defeat device that caused NOx emissions at 40 times the standard limit (Alter 4). At the time that the EPA violation was levied it was believed that at least 480,000 cars in the United States would be affected by the defeat device.

With this big lawsuit, there are a huge number of suspects from the big CEOs at Germany to New York City. Suspects of the implementation of the defeat device are several however Bosch is one of the principal suspects. Bosch who seems to be the developer of the software device. According to the lawsuit against, “Volkswagen’s fraudulent scheme was facilitated and aided and abetted by defendant Bosch, which created the software used in Volkswagen’s defeat device.” Even though there is not much evidence that links him with the

The term utilitarianism is an ethical tradition that really focuses on the consequences of our actions. Outcomes matter with utilitarianism. When making a decision, we act in ways to produce better consequences than the alternatives. Better consequences can be thought of as anything that promotes the well-being for us as humans. Utilitarianism can be summarized as producing “the greatest good for the greatest number.” This idea opposes benefiting just a small portion of society. The well-being of everyone is considered with utilitarianism.

Utilitarianism is a theory of consequentialist obligation that consolidates the ‘net good’ of a situation, in which the goal of any person is to achieve the maximum ‘net good’ for all people in said situation and in some cases those

Kenneth Floyd’s speculates that the CEO of Volkswagen may not have known, or was completely unaware of the defective devices because of poor communication (Floyd,2017). While this opinion might be possible my opinion dissents from Floyd’s as I believe that all things rise and falls with leadership, and for this reason the CEO complied and was fully aware of the deception that was occurring within the VW organization that led to fraud. At the core, many levels within the VW organization was participating in a culture of unscrupulous, immoral behavior to deceive the American public over a lengthy amount of time orchestrated by unapologetic leadership (Elson, Ferrere & Goossen, 2015). Knowing the strict regulation of the Clean Air Act Winterkorn,

John Liang and his colleagues sought to design a new technology that would improve the quality of life. In this case, improvement of the quality of life was an “EA 189” diesel engine that would pass US emission standards for “clean diesel”. Unfortunately, as time passed, John began to realize that their design had not lived up to expectations and would not be able to pass emission standards set by the United States. Suddenly, they took a one hundred and eighty-degree turn in their motives. Instead of admitting defeat, and postponing the production of their “EA 189” diesel engine, like any engineer with morals would he and his colleagues decided that if they couldn’t pass the emissions test, then they would trick it.

Utilitarianism is the ethical belief that the happiness of the greatest number of people is the greatest good. Jeremy Betham and John Stuart Mill are two philosophers that were leading advocates for the utilitarianism that we study today. In order to understand the basis of utilitarianism, one must know what happiness is. John Stuart Mill defines happiness as the intended pleasure and absence of pain while unhappiness is pain and the privation of pleasure. Utilitarians feel the moral obligation to maximize pleasure for not only themselves, but for as many people as possible. All actions can be determined as right or wrong based on if they produce the maximum amount of happiness. The utilitarian belief that all actions can be determined as right or wrong based only on their repercussions connects utilitarianism to consequentialism. Consequentialism is the belief that an action can be determined morally right or wrong based on its consequences. Just like any other belief system, utilitarianism faces immense amount of praise and criticism.

Consequentialism is the moral theory that the morality of an action is to be judged solely by its consequences. Although this definition is relatively specific, it covers a broad range of philosophies. For the context of this paper we will focus on the concept of utilitarianism as it has been emphasized in lecture. Utilitarianism is a form of consequentialism related to the maximization of utility; looking to maximize the good, while minimizing the bad.

The idea in utilitarianism is that the moral worth of an action is determined solely by its value in providing happiness or pleasure as summed among all conscious beings. It is a form of consequentialism, meaning that the moral worth of any action is determined by its outcome. Thus the utilitarian maxim: the greatest good for the greatest number. The largest contributors to utilitarianism were Jeremy Bentham and John Stuart Mill. [1]

Utilitarianism is one of the most powerful and persuasive approaches to normative ethics in the history of philosophy. Even though It was not fully articulated until the 19th century, proto-Utilitarian positions can be recognized and discerned throughout the history of ethical theory. (Driver, Julia. “The History of Utilitarianism.” Stanford University. Stanford University, 2009. Web. 01 Oct. 2016). Utilitarianism is an Ethical Theory that was a result of combining aspects of Consequentialism and Hedonism. With these theories in mind, the best consequence is the one that maximizes on happiness and minimizes the pain. Consequentialism states that: “No matter what act was performed to produce some result, if the result is good than so is the act.” By the same token, if the result is bad, then whatever act caused it is also bad. (As we discussed these in class.) According to our PowerPoint in class, Hedonism claims that: “The only thing that has real value is pleasure or happiness. Pain is what has disvalue.” Julia Driver puts it into layman’s terms for us when she says, “Utilitarianism can also be distinguished by impartiality and agent-neutrality. Everyone’s happiness counts the same. When one maximizes the good, it is the good impartially considered. My good counts for no more than anyone else’s good. Further, the reason I have to promote the overall good is the same reason anyone else has to promote the good,” (Driver, Julia. “The History of

VW is also developing intelligent electronic-assistance systems to improve the safety and efficiency by using technology to help guide the vehicles.Thus,good health and well-being along with efficient usage of the available infrastructure is being prioritized by

Another internal challenge that Volkswagen faces would be changing its complicated company culture which is overly opaque and hierarchical. With many complex layers and processes (McHugh, 2015), this makes it hard for unethical practices to be discovered as seen by Volkswagen deliberately deceiving their consumers.