Volkswagen Emissions Scandal: Real World Control Failures and Consequences
Learn about the Volkswagen emissions scandal, including the use of defeat devices, lack of governance over production, legal consequences, and the resulting settlements. Discover what leadership could have done differently to prevent this scandal. Explore valuable resources for further information.
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THE VOLKSWAGEN EMISSIONS SCANDAL MIS 5121: Real World Control Failures Tiesha Christian
VOLKSWAGEN Volkswagen is a German automaker founded on January 4th 1937 Volkswagen is known as the people's car Volkswagen has factories in many parts of the world. Such as Mexico, USA, Slovakia.
THE VOLKSWAGEN SCANDAL The Environmental Protection Agency (EPA) found that many VW cars being sold in America has a "defeat" device or software. In diesel engines that could detect when they were being tested, changing the performance accordingly to enhance results. VW has admitted to cheating emissions test in the US
THE VOLKSWAGEN SCANDAL Control Failure: Lack of Governance over production Volkswagen reached a $1.2b settlement with the US dealers over the emissions scandal James Robert Liang, 62 pleaded guilty in federal court in Detroit to a single charge of trying to defraud the United States and violate the Clean Air Act It was shared with the public that Top Level Executives were not involved physically. However, misconduct was tolerated
RESULTS After compromising 11 million vehicles in worldwide VW has decided to pay for their wrong doing Several lawsuits VW headquarter offices are raided by authorities VW offers each affected customer $500 which cost the company a total of $250m Volkswagen will pay $10 Billion to any customer affected owner $2.7 Billion for environmental cleanup $2 Billion to promote
WHAT COULD/SHOULD LEADERSHIP DONE DIFFERENTLY Segregation of duties to avoid the risk of fraud and vulnerabilities. Stronger internal controls to help mitigate fraud.
RESOURCES http://www.bbc.com/news/business-34324772 http://www.latimes.com/business/la-fi-volkswagen- settlement-20161001-snap-story.html Wikipedia https://www.theguardian.com/business/2015/dec/10/volksw agen-emissions-scandal-systematic-failures-hans-dieter-potsch http://www.cnn.com/videos/cnnmoney/2016/06/28/cnnmon ey-volkswagen-emissions-scandal-timeline.cnn
