VW EMISSIONS SCANDAL 1
The Legal, Ethical, and Biblical perspective of the VW Emissions Scandal
Lindsey Davis
School of Business
Liberty University
BUSI 561-B03
Professor Hubbard Harvey
VW EMISSIONS SCANDAL 2
Abstract
In the modern business environment consumers are being more concerned with firm’s
business practices. This means that how they act, not just the products they produce, is also
affecting decisions on what the consumer purchases. This practice by consumer brings to light
unethical practices within business operations, and brings them into the public eye, and in many
cases can lead to criminal or civil charges. When organizations, and members within that
organization operate in an unethical manner or make illegal decisions whether intentional or not,
it threatens many aspects of the business operation.
If these unethical or illegal practices are allowed to continue without consequence, they
will become commonplace and can turn into the norm of the operation. This can lead to a
negative public image, legal action, and the risk of organizational failure. When Volkswagen
installed software that was intended to falsify emission reports, they knowingly were misleading
shareholders and making unethical and illegal decisions. In Ephesians 5:6 it is said “Let no one
deceive you with empty words, for because of such things God’s wrath comes on those who are
disobedient” (Ephesians 5:6, New International Verison, 1978/2011). Empty words can be hard
to notice in the moment, but one they come to light and are seen for what they are, which was the
case for Volkswagen, action was able to be taken to ensure there would be actions for their empty
words. When Volkswagen made its statement “The S.E.C.’s complaint is legally and factually
flawed, and Volkswagen will contest it vigorously,” (Ewing et al., 2020) they knew, that these
were empty words and were guilty of installing devices to trick the system and that these devices
would show their diesel vehicles were performing better than they were. While it did take several
years for this to come to light, it did eventually get noticed, and action was taken.
VW EMISSIONS SCANDAL 3
The Legal, Ethical, and Biblical perspective of the VW Emissions Scandal
From a legal perspective, Volkswagen made many nefarious decisions. From misleading
shareholders to importing cars that violated EPA standards, just to name a few. While they made
this decision with a clear mind and were aware of their choices, it calls into question the efficacy
of regulations and why they were able to get away with it for so long. In a 2015 statement then
CEO Martin Winterkorn made a statement apologizing for Volkswagen actions however "for the
preceding seven years, the world's largest automaker had sold cars with emissions control
systems that satisfies regulators' mandatory emissions tests when connected to laboratory devices
that emitted up to forty times more pollutants than allowed by law when driven on the road"
(Coglianese & Nash, 2017). This calls into question the effectiveness of the regulatory systems
in place across the globe because this happened in Europe, the United States, and Canada.
This issue arises here that within the European Union (EU), Volkswagen began to argue
that they did not violate any laws because they had operated within a loophole. This loophole
was noticed at a 2011 Auto regulators meeting in Geneva, but it was decided not important
enough to deal with. This meant that while most of the cars affected would be located within the
European Union however the criminal charges and fines would come from the United States and
Canadian prosecutors. Another problem the regulatory system the EU faces is that cars used
within any of the member states can be certified within any of the member states. This is
important because “Countries differ in how they implement EU rules, resulting in test standards
that are soft and easy to manipulate” (Tarsa, 2017). Auto companies, like Volkswagen, know how
to work the system to their advantage.
VW EMISSIONS SCANDAL 4
As a manager in the legal office, the prevention of this incident would have been quite
difficult. This is because the illegal and unethical decisions because made were by c-suite
executives, which means speaking up would have meant the potential loss of a job. However,
whistleblowing on illegal or unethical practices is protected practices and retaliatory practices
(such as firing or harassment) are also illegal.
So, the question becomes a moral one in this case, how should a Christian deal with sin
within the workplace? Should the matter be reported to the next higher up in the chain of
command, or are those the perpetrators themselves? The issue here is duty over greed, and it is a
defining moment. Just like in Proverbs 20:17 where is says “Food gained by fraud tastes sweet,
but one ends up with a mouth full of gravel,” (Proverbs 20:17 New International Verison,
1978/2011) money gained by greed, or false actions may be great in the moment, but will not last
long. This was true in the case of Volkswagen, while they saw a great gain during the seven years
of falsifying their data by using cheat software, the loss they faced neared 15 billion dollars.
From an ethical perspective, there are many reasons why a firm may engage in nefarious
practices to further its business. They may want to maintain their competitive edge or could be
facing tremendous debt, maybe even a lack of funding to complete the promised product. In
some cases, there is not any reason except an opportunity and a lack of strong moral convictions.
No matter what the reason is, ethical violations have a great impact on organizational success.
The question becomes, whose ethics are the decisions being made on? Because for some,
especially as Christians, we are taught and guided in our ethical values, for others it may be
harder to find and discover where their boundaries are. Regardless of where everyone’s ethical
VW EMISSIONS SCANDAL 5
values lie, businesses should not violate public safety, health, and security simply to further their
bottom line, which is exactly what Volkswagen did.
Consider the specific software used in the Volkswagen case “employees intentionally
developed software that could differentiate between typical driving conditions and laboratory
testing conditions, adjusting engine performance and the corresponding emissions output
accordingly” (Castille et al., 2016). This was not an unintentional error or a miscommunication,
this was an intentional, planned, and purposeful unethical decision to mislead and falsify data.
Volkswagen was on a shoestring budget, and unable to deliver on the product they so loudly
promoted, and rather than act honestly and ethically, they deceived millions of people. Not only
that, but they also caused irreparable harm to the environment, as well as economic harm.
The CEO’s immediate public response to the scandal was placating, denied involvement,
and they denied answering any more questions. Had I been in this position, as a corporate head, I
cannot say that I would have answered in much more depth, however my response would have
not been a denial nor an admission. But rather, “we are looking into this situation and will share
more information if the need arises”. I think that it is important to gather all the necessary
information before sharing anything with the public to ensure that all the information that is
shared is accurate and factual. Like in Psalm 119:160 where it states, “All your words are true;
all your righteous laws are eternal” (Psalm 119:160 New International Verison, 1978/2011). It is
important, as a leader, to make sure that the statement being made is truthful to the best of the
leader’s ability.
Deceit and fraud are actions that allow a company to grow or gain income and assets due
to fraudulent methods. The difficulty with companies that engage in these actions is the
VW EMISSIONS SCANDAL 6
consequences vary by each country, which means that if they run into legal issues in one country,
they could potentially go operate in another country. However, I believe that the penalties should
apply in all the countries they operate in, and the list of their indiscretions should be shared
publicly. When illegal or unethical actions are kept quiet and brushed under the rug, the ability to
properly regulate and prosecute the offenders becomes increasingly difficult. For some of these
reasons, and more that were not mentioned, Volkswagen was able to produce and distribute cars
with cheat software, subvert the law and operate within loopholes that did not make some of
their practices illegal within the EU.
References
Castille, C. M., Buckner, J. E., & Thoroughgood, C. N. (2016). Prosocial Citizens Without a
Moral Compass? Examining the Relationship Between Machiavellianism and Unethical Pro-
Organizational Behavior. Journal of Business Ethics, 149(4), 919–930.
https://doi.org/10.1007/s10551-016-3079-9
Coglianese, C., & Nash, J. (2017). The Law of the Test: Performance-Based Regulation and
Diesel Emissions Control. Yale Journal on Regulation, 34(1), 33-90.
http://ezproxy.liberty.edu/login?qurl=https%3A%2F%2Fwww.proquest.com%2Fscholarly-
journals%2Flaw-test-performance-based-regulation-diesel%2Fdocview%2F1888659912%2Fse-
2%3Faccountid%3D12085
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Ewing, J., Stevenson, A., & Goldstein, M. (2020, May 20). Ex-VW Chief Knew of Diesel Scheme
Years Earlier Than He Admitted, S.E.C. Says. The New York Times.
https://www.nytimes.com/2019/03/15/business/volkswagen-winterkorn-sec-fraud.html
New International Version Bible. (2011). The NIV Bible. https://www.thenivbible.com (Original
work published 1978)
Tarsa, K. (2017). Won't get fooled again: Why VW's emissions deception is illegal in Europe and
how to improve the EU’s autoregulatory system. Boston College International and Comparative
Law Review, 40(2), 315-342.
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