Question

Essay about how the car company Volkswagen is being Corporate Social Responsibile to the society. what good have it done?

Answer 1

Volkswagen (VW) is a German automobile manufacturer operating in multi continents and one amongst the leading car manufacturers. From the vision statement of VW it is found that, VW wanted to be the most attractive employers by 2018 (Volkswagen, 2016). In addition, Volkswagen believes that healthy and skilful team can make an efficient team (Volkswagen, 2016). By these findings, it can be predicted that the company is bound to maintain a healthy working environment, which is an evidence of following corporate social responsibility . Apart from the internal ethical environment VW is actively participating in the social support activities (one of the components in CSR activities) such as education and training centre in India and other countries, awareness programmes on fuel consumption in Australia , conservation of threatened species in China, encouragement to technology innovations at graduate levels and other public awareness programmes (Volkswagen, 2012). Though VW is playing an active role in CSR, in the year 2015 an ethical dilemma has been recorded.

In the world of manufacturing industries, companies and manufacturers have to maintain certain standards in their products in the market (Hotten, 2015). Despite of these standards, VW has violated the permitted carbon emission level of their diesel variant vehicles, which was identified by a small research team at University of Virginia. Latter the issue was reported to Environmental Protection Agency (EPA). EPA, in its investigation has discovered a defeat device that cheats the agency in from recognition of excess pollution at checking stage before the car is certified to release in the market. To describe in depth, VW has used a device in the vehicle’s exhaust system that neutralise the carbon dioxide elements, but to make the device to be effective more fuel has to be consumed by the vehicle . However, VW cannot afford a higher fuel consumption car in its products, which is a potential threat to its market . The neutralising device is designed to have a flexibility in switching it on and off as a result, fuel consumption can be altered. Moreover, a software feature is provided in the vehicle interface that actually reports carbon emissions by the vehicle. In the real time usage the readings recorded by the software does not match with actual emissions. As the carbon element-neutralizing device is switched off in the real time usage for lower fuel consumption, the carbon dioxide elements are released into atmosphere which is much more higher than the standard emission values . By the software features and defeat device, VW has cheated the EPA from discovering the real time emission values. After the issue being exploited, EPA has found that the carbon emissions are 40% higher than the legal limit of carbon emission. As VW claim their cars to be with low emission by cheating the EPA, there is an ethical issue, which can damage the company’s prestige in the global society. In this critical situation, VW has to act carefully on the issue. On the issue, the company’s chief executive officer has resigned taking responsibility of the issue. The executive committee of VW has appointed new leader and has called back for rectification for all the claimed vehicles. By this response, it can be assumed that VW is trying to resolve the problem and retain their company’s value.

Few more cases that are similar to VW issue are being recorded, but to evaluate such issues, to understand the role of corporate social responsibility and to map company’s activities to CSR functions some theories are required. From the research, it is discovered that, of the theories developed and research, Carroll has explained the value of CSR and developed a CSR pyramid. The pyramid illustrates the important components that are to be followed by a company at different levels of the company’s management.