Since 2015 Volkswagen Group has been officially involved in an emission fraud scandal (Dieselgate) and its repairments, which led to be one of the most costly fraud cases in the history of the automotive industry. The self-imposed Dieselgate was an expression of poor work by VW with inadequate decisionmaking by management, unethical corporate governance, and a lack of a duty of responsibility.
VW faced three allegations of misconduct. Intended air pollution, breaking the rules and cheating on emissions tests. Therefore, the Dieselgate is used to analyze and explain the assertion “Not doing something can require investments” by referring to the ethical compass (EC). The study is going stepwise to explain the meaning of the assertion by giving a rough understanding of the Dieselgate (Chapter 2), analyzing the Dieselgate with the help of the EC to answer the question whether VW postponed its investments into the future or not (Chapter 3), transferring the analysis results to the general to define the real meaning of the assertion (Chapter 4) and then giving a conclusion (Chapter 5).
Table of Contents
1 Introduction
2 Background
3 Analysis
4 Results
5 Conclusion
Objectives and Topics
This essay examines the Volkswagen emission fraud scandal (Dieselgate) through the lens of the "ethical compass" to explore the assertion that "not doing something can require investments." It investigates how corporate decisions to postpone ethical investments in favor of short-term gains led to significant long-term financial and reputational costs.
- Analysis of VW's corporate decision-making and ethical misconduct.
- Application of the "ethical compass" framework to evaluate corporate behavior.
- Examination of the short-term versus long-term consequences of avoiding necessary investments.
- Comparison of VW's trajectory with competitors like Tesla in the transition to e-mobility.
Excerpt from the Book
3 Analysis
In this chapter, VW’s actions of the Dieselgate are described with the emphasis on the EC. The EC focuses on the principle of doing no harm by combining the elements of freedom, embeddedness, respect and commitment. It is divided into four directions aim, analysis, attitude and actions. The user of the EC is asked to use his freedom responsibly and reasonably by understanding and respecting the environment in its social and temporal embeddedness, including rules, laws and values in order not to cause harm by investing in the freedom by restraining it. (Wittenberg Center for Global Ethics, 2017).
Looking at the Dieselgate with a focus on the EC, it is noticeable that already in the definition of VW's objective to conquest Toyota and its market position, VW did not include its environment in its decisions and actions (Jack Ewing, 2017). VW focused on its hedonic and instrumental values. Which were caused by the immediate impulse of a stronger competitor, the desire for US market expansion and the chance to launch a product based on its established diesel technology without investing too much into research. The instrumental values increased over the progression of the scandal. The objective was to maximize profits and sales by using the treat of climate change and pollutants (Luc Bovens, 2016; Markus C. Schneider, 2008). At the time, VW was clearly technologically inferior to its competitor Toyota. The decision to launch vehicles based on a manipulated testing was the only possibility from VW perspective to cope with its inferiority to be able to conquest against Toyota and to satisfy its values. Since an investment in form of self-restraint would have further increased the barriers to market expansion (Handelsblatt, 2015; Jack Ewing, 2017).
Summary of Chapters
1 Introduction: This chapter introduces the Dieselgate scandal as a case of poor management and unethical corporate governance, setting the stage for an analysis based on the ethical compass.
2 Background: This section describes VW's expansion strategy into the US market and the subsequent decision to use illegal software to manipulate emissions tests to achieve competitive advantages.
3 Analysis: This chapter applies the ethical compass framework to VW's actions, highlighting how the focus on short-term instrumental values led to the disregard of environmental and partner-related responsibilities.
4 Results: This chapter reflects on the core assertion, defining "not doing something" as a failure to make ethical investments, which ultimately leads to higher financial and strategic costs.
5 Conclusion: The final chapter summarizes that failing to invest in mutual advantages leads to inevitable future costs and suggests that early ethical investments are key to long-term corporate success.
Keywords
Dieselgate, Volkswagen, Ethical Compass, Emission Scandal, Corporate Governance, Business Ethics, Strategic Management, Sustainability, E-mobility, Financial Impact, Innovation, Market Expansion, Social Responsibility, Automotive Industry, Ethical Investment
Frequently Asked Questions
What is the core subject of this paper?
The paper fundamentally deals with the Volkswagen emission scandal, commonly known as "Dieselgate," analyzing it through the perspective of business ethics and corporate responsibility.
What are the central themes of the study?
The central themes include corporate decision-making, ethical leadership, the consequences of bypassing environmental regulations, and the long-term impact of choosing short-term gains over sustainable investments.
What is the primary research objective?
The objective is to explain and validate the assertion "Not doing something can require investments" by applying it to the specific case of VW's emission manipulation.
Which scientific methodology is utilized?
The study utilizes a descriptive analysis of VW's historical actions and events, evaluated through the theoretical framework of the "ethical compass" (EC) to determine the ethical implications of the company's behavior.
What is covered in the main body of the work?
The main body covers the background of VW's market expansion, the detailed analysis of the decision to use defeat devices, the ethical implications according to the EC, and the resulting financial and structural consequences.
Which keywords best characterize this work?
The work is characterized by terms such as Dieselgate, Ethical Compass, Corporate Governance, Business Ethics, and Strategic Management.
How does the author interpret the phrase "not doing something can require investments"?
The author interprets this as a situation where avoiding an upfront "ethical investment" (such as R&D for cleaner technology) forces a company to pay significantly higher costs later for damage control, fines, and reputation repair.
How does the comparison with Tesla serve the author's argument?
Tesla serves as a benchmark for a successful company that invested in innovation and mutual advantages early on, illustrating that the path taken by VW was not the only—or most successful—option available.
- Arbeit zitieren
- Tanyel Tunçer (Autor:in), 2022, Dieselgate. An Ethical Analysis, München, GRIN Verlag, https://www.grin.com/document/1183592
