Volkswagen is the Benchmark for Failed Leadership Accountability
Last month marked the third anniversary of the EPA announcement which exposed the Volkswagen emissions cheating scandal now known as Dieselgate. In a blog post last week — Corporate Social Responsibility Is Part of Leadership Accountability — I wrote about how corporate cheating is unacceptable, even when done in the purported interests of employees and shareholders.
Let’s look at two other aspects of the Volkswagen saga and what happens when leadership accountability is not part of the corporate culture. This cheating scandal has impacted Volkswagen’s loyal customer base, as well as its corporate reputation.
Many current and potential customers of Volkswagen are undoubtedly looking elsewhere for their next vehicle purchase. After all, as mentioned in the previous post, Corporate Responsibility Is Important To Consumers, consumers are spending on brands that have a social purpose, which Volkswagen obviously does not. Reduced sales will impact the VW labor force, its car dealership network, and even its suppliers of materials and parts.
Volkswagen as a corporate entity — which means both its leadership team as well as every employee with knowledge of these shenanigans — had a responsibility to their customers, fellow employees (and their families), the dealer network owners and employees (and their families), and the owners and employees of all its materials and parts suppliers (and their families).
Volkswagen — meaning its leadership team and the employees with knowledge of this deliberate subterfuge — failed to live up to their collective and individual responsibilities to these stakeholders and their families. There was no Leadership Accountability to be seen anywhere within the Volkswagen organization, a fact that has now cost the company over $25 billion and seen two of its employees in the United States sentenced to lengthy terms in federal prison.
In society, when people do not live up to their collective and individual responsibilities to the community, they are usually jailed, ostracized, or outcast.
In the corporate world, such failure to meet the duties of corporate responsibility and leadership accountability results in massive loss of value, reputation, market share, and, of course, sustainable success. As I discussed in my book Leadership Lessons From The Volkswagen Saga, this is exactly what continues to happen to this once-respected automaker.
This article is excerpted from my book Great Leadership Words of Wisdom, which is available on Amazon in both paperback and Kindle formats and has over 1000 quotes on leadership from global business leaders, statesmen, athletes, coaches, sages, and philosophers.