Dear Mr. Chairman,
Ladies and Gentlemen,
My name is Erik Bomans and I’m here as representative of Deminor from Brussels, Belgium. Deminor advises a group of institutional and private shareholders of Volkswagen AG. Among our clients are the pension funds of the City of New York and AP2. We also work in close cooperation with the shareholders’ association SdK.
On behalf of our clients we submitted a motion which is included in the agenda as TOP 8. If you vote in favor of TOP 8, you agree to appoint a special investigator (“Sonderprüfer”) who will have as task to subject the Diesel emissions scandal to a fully independent investigation.
Why do we think a “Sonderprüfer” should be appointed? Because more than 8 months after the company publicly admitted having used defeat devices to circumvent emissions regulations, we still do not know what really happened, who is responsible, and how such blatant violations could occur in a company that had set as ambition to become the world’s most sustainable car manufacturer by 2018.
The Board has refused to disclose the preliminary results of the Jones Day investigation. But at the same time Volkswagen has repeatedly disclosed certain ‘bits and pieces’. As shareholders, we are not interested in those ‘bits and pieces’. Our message to you is very simple: we want the full truth to be disclosed, and notonly those facts that are favorable to the company’s management. Furthermore, we want a truly independent investigation, with the broadest possible mandate, and without any possibility for the company’s management to act as a “filter”.
If the company’s management or supervisory board bear responsibility for the Diesel emissions scandal – and there are serious indications that this is indeed the case - let it be known to the shareholders. If shareholders were misled, they are entitled to know. Sweeping the problems under the carpet will not work and will only lead to a further erosion of all stakeholders’ trust.
Full transparency is also needed in order to identify shortcomings in the company’s internal control mechanisms and corporate governance. Only once shareholders know where it went wrong, measures can be proposed to avoid that this kind of violations happen again the future.
Our proposed motion contains a list of questions that the “Sonderprüfer” should examine and answer. Besides those questions, we adhere (‘eigen machen’) to the questions that will be asked by the shareholder association SdK and by Hermes at this general meeting.
The way Volkswagen has dealt with the scandal, its refusal to create transparency over the past, the appointment of the former CFO as Chairman of the company, the complete absence of independent members on the supervisory board, and last but not least, the payment of variable remuneration to the former CEO while he possibly breached his fiduciary duties, are all clear signs that the company has not learnt anything from the past.
The company has broken investors’ trust. It now has to break with the past, reform its antiquated governance and compliance structure and create full transparency. Only then shareholders and other stakeholders can regain trust in the company and new foundations can be laid for future value creation.
Written on Jun 22, 2016 by