Volkswagen’s Bribery and Corruption Cases

Over the years, aspects of corruption and bribery have been rampant in most industries operating in the global market. The automobile industry has had its fair share of representation. Volkswagen has been on the forefront with regards to bribery and corruption incidences. The actions of the people involved have left different stakeholders asking various questions regarding what these individuals were thinking while perpetrating the scandals (Mintzberg, 2015).It looks pretty obvious to the public that such actions are likely to come to light at some point as the organization continues with its operations.

The bribery and corruption cases within the organization have been witnessed in different countries where the company operates. This occurrence has resulted in the issue being regarded to as being a syndrome due to its nature of being repetitive and widespread (Mintzberg, 2015). Employees are devising different financial maneuvers to swindle the company and other relevant stakeholders. This is because it is usually easy to escape conviction on corporate crimes. On most occasions, fines are awarded, and this might be a reason that encourages employees and top level executives to defraud people on numerous occasions. It is upon the business laws in different countries to implement stiff consequences for individuals entangled in corporate crimes. Fear of the severe long-term consequences might deter corporate employees from getting involved with unending bribery and corruption incidences in their line of work (Donatella & Vannucci, 2016).

Below are some of the bribery and corruption cases that have been prevalent in Volkswagen.

 

China

In 2014, China’s corruption watchdogs were investigating different executives associated with Volkswagen. The investigations were targeting a current and a former executive involved with Volkswagen AG’s Chinese venture. This was on the grounds of “seriously violating the law” (Niculescu, 2015). The former senior executive (Shi Tao) was found guilty of corruption and thus served with a life sentence. Shi Tao was a former deputy general manager and was found guilty of accepting $5.3 million in bribe. These bribes came from car dealers and advertisers who were accorded the ability to attain business orders from FAW-Volkswagen (Niculescu, 2015).

Shi Tao had accepted bribes from 48 companies and individuals since 2006. Suspicions regarding his dealings came in 2013 when he amassed property investments worth millions, from sources that were not clear. The instances were discovered during an audit in 2013 (Niculescu, 2015).  Volkswagen has always been strict against any form of illegal conduct. There has been an emphasis on applying anti-corruption laws that are instituted in different jurisdictions that they operate in.

 

 

 

India

In 2005, Andhra Pradesh had pushed to get Volkswagen to set up a Rs 5,800 crore plant in India. This was a significant achievement given that he defeated the neighboring countries in clinching this deal. Schuster, who was a former Volkswagen’s executive, was involved in brokering the deal. Schuster asked for 2 million Euros, which was part of the 5 million Euros proposed by the Indian government (Menon, 2005). The payment was an installment of the government’s share of equity that was floated in a joint venture; VashishtaWahan. The joint venture was the one expected to set up t

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