Volkswagen And Corporate Governance

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Case Study Project 04/04/2011 An Analysis of Case Study 1.2 “Volkswagen struggles to get back on the road” Volkswagen (VW) – the people’s car. There is significance of meaning in this name that ties in not only with Volkswagen’s historic past, but also provides insight into problems that the company faces in our relative present. Our focus in this paper will be analysis regarding the subject of Volkswagen as presented in Case Study 1.2. This analysis will draw on the circumstances behind Volkswagen’s establishment and highlight concepts such as corporate governance and corporate mergers. We will explain how corporate governance has played a significant role in shaping Volkswagen, in terms of strength and weakness during the time this textbook was published; and to conclude, we will provide an update emphasizing how mergers have played a role in where Volkswagen is today. Theoretical Principle As mentioned by Janet Morrison in her book “International Business, Challenges in a Changing World”, one of the purposes for case studies is to “[explore chapter themes and create links between the different topic areas covered in the book]” (Morrison, xxvii). To that end, Case Study 1.2 looks at the term corporate governance as it relates to Volkswagen. Corporate governance is defined as “a company’s decision-making structure and processes at the highest level, by which its directors are responsible to its owners and other stakeholders” (Morrison, 21). Corporate governance structures differ from country to country, with varying levels of transparency and accountability mechanisms. The single-tier board in the US and the UK contrasts with the two-tier board in much of Europe, which allows for representation of employees on the supervisory board. In Germany, it’s one-third in companies with over 500 workers, and one-half in companies with over 2,000, which is the

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