Volkswagen Emissions Scandal: Ethical Failure & Regulatory Breach

Abstract

[Name] The Volkswagen emissions scandal began in September 2015 when the United States Environmental Protection Agency (EPA) issued a notice to the company on emissions of their cars manufactured between 2009 and 2015. Investigations showed that the diesel engines of the company’s cars caused higher emissions of ore nitrogen oxide (NOx) than required in the United States. Consequently, agencies around the world conducted their analysis of the vehicles and noted that the company had installed software that lowered emissions during the testing of the product. Professional ethics require that experts in a particular field conduct themselves in an honest manner that ensures they earn and maintain the trust of their stakeholders. In the triangle of self-interest defines the three-way relationship between the professional, the client, and the organization. Volkswagen’s managers and employees failed to honor the trust of their consumers by installing a system that cheated in the test of their vehicles leading to high levels of emissions. Additionally, they failed to provide the regulators with the relevant information to ensure the tests provided factual data on the emission of Volkswagen’s cars. The actions of the professionals led to financial losses and negative effects on the brand’s reputation in the years following the scandal. My thesis is that Volkswagen violated professional ethics by lying to clients and government agencies. Volkswagen is an automotive multinational company headquartered in Wolfsburg, Germany. Founded in 1937, the company focused on the design and production ow front-wheel drive cars. Known as the Volkswagen Group, the organization is one of the largest multinational vehicle manufacturers and distributors in world having acquired brands such as Porsche, Bentley, Audi, and Seat. Volkswagen manufactures cars sold all over the world with its major markets in Europe and the United States. Like other industries, the automotive industry is regulated by government agencies and international organizations to ensure the safety of consumers and other people. Volkswagen has to ensure that its products meet the requirements for local, national, and regional institutions on various aspects affecting the users and non-users. Consequently, Volkswagen’s products and those of other organizations in the automotive industry have to undergo tests before being introduced into the market. The organization’s managers and engineering professionals have the responsibility of ensuring that the products meet the expectations of the consumers while abiding by regulations of all relevant industries. The Volkswagen emissions scandal resulted from the failure of the managers and the professionals at the company to abide by their obligations to the organizations and their clients. One of the most significant aspects of regulations in the automobile industry is the impact of the products on pollution. The EPA regulates the amount of carbon dioxide (CO2) and nitrogen oxides (NOx) that a vehicle should release in the atmosphere. The harmful gases have significant implications on the quality of air in the environment and associated health effects on the populations. While diesel engines have greater fuel efficiency and lower levels of CO2 than petrol engines, they produce as much as 20 times more NOx into the atmosphere. It is the responsibility of the professionals in the car companies to ensure that their products do not exceed the emission levels of the harmful pollutants. The United States has increasingly revised the requirements of the NOx emissions allowed on the American roads and required that all companies selling vehicles in the country abide to the standards. The United States EPA is in charge of regulating the emissions of harmful gases by motor vehicles. To achieve this objective, the agency established the US Tier 2 rules in 1999 that required vehicles to emit 0.07g/mi of NOx with the rules taking effect in 2009. Beginning 2005, Volkswagen began taking measures to align with the United States standards on NOx emissions for their diesel cars targeting the market. A viable but costly solution was to use the selective catalytic reduction (SCR) system from Mercedes. The company’s management decided that the option was too expensive and it was necessary to develop their own technology for their cars. The lean NOx trap technology by Volkswagen sought to achieve the requirements on emissions while ensuring the fuel efficiency of their vehicles. However, the company’s system failed to achieve both options since it lowered emissions at the expense of the fuel efficiency of their vehicles. While it was clear to the professionals at the organization that the technology was not fulfilling its purpose, they marketed the system as a success. Volkswagen introduced firmware in their Engine Control Unit (ECU) in 2006 that switched between reducing emissions and achieving efficiency in their cars. The company’s program allowed their vehicles to minimize emissions to match the American standards during tests but increase fuel efficiency during every-day use. The case of Volkswagen demonstrates the role of professional ethics by employees in the company who are responsible for ensuring that their products are safe for the users and the environment. The company’s action led to the recall of the vehicles they manufactured between 2009 and 2015. At the heigh of the Volkswagen emissions scandal, the company had sold over 500,000 vehicles in the United States alone and 10.5 million others in other parts of the world that had the cheating software to conceal actual levels of emissions. Volkswagen was cheating in the emissions tests by producing results that failed to align with the daily use of their vehicles. Its diesel cars produced between 2008 and 2015 failed to align with the regulations and standards on NOx emissions in the United States and Europe leading to a country-wide scandal. Despite having denied claims of the scandal, a representative of Volkswagen admitted to Christopher Grundler, the director of the Transportation and Air Quality at EPA at the time, that the firm was violating the regulator’s rules. Investigations showed that over 30 top managers of the company knew of the cheating program and failed to take appropriate actions to protect the consumers and the environment. Additionally, the investigations led to questions on the potential application of similar technologies by other automobile companies and machinery companies. It is the responsibility of professionals in the organization to ensure that they balance their own interests with those of their clients and the organization. With the impact of automobiles on air pollution being a critical issue in industrialization, professionals play a central role in ensuring that organizations are accountable for their actions. A professional is an individual authorized by a government agency to undertake tasks that require training, expertise, and high compensation. The government licenses and scrutinizes professionals to ensure public safety in the products and services that companies sell in the market. Individuals obtaining licenses to practice in a certain field should ensure that their conduct does not lead to the harm of their clients or the general public. Professional ethics define the type of conduct that ensures individuals in a certain area of expertise protect their clients, the organization, and the society. Individuals with expertise and licensure in a field must ensure that they contribute towards the welfare of other people by applying their skills in their place of employment. The Volkswagen emissions scandal describes an example of a case where professionals deliberately failed to practice their duty of protecting vulnerable consumers from using products that did meet government standards. The managers and engineering experts at the company deliberately used a cheating device in the company’s products that prevented emission tests from accomplishing their goals. Volkswagen’s management contributed to the scandal by concealing information that was the core of the testing process for their cars. With the Tier 2 rules coming into effect in 2009, EPA required vehicles to emit 0.07g/mi or lower of NOx to manage environmental pollution in the industry. The scandal describes the triangle of self-interest in professional ethics and how the company’s actions affected its clients, the society, and the environment. The triangle of self-interest defines how professionals interact with the stakeholders of organizations specifically themselves, their clients, and the institution/government. According to the framework, there is a three-way relationship among professionals, the clients of their services, and the organization. Additionally, it incorporates the role of the regulators to conduct supervision on all the activities in organization to determine the implications they have on the consumers of products and services. For instance, the EPA is the institution that investigates instances of air pollution by organizations operating in and selling their products in the United States. By availing its diesel engine cars to the American market, Volkswagen was bound to align with the agency’s requirements on air pollution at the time. Since the implementation of Tier 2 rules in 2009, the professionals at Volkswagen were responsible for ensuring that the company aligned its cars with the new requirements. Professional ethics regulate the conduct of the managers and engineers at organizations to ensure that they meet government regulations on people’s safety. At the center of the triangle of self-interest is the occasion that causes the conflict of interest among professionals in a certain organization or industry. The occasion at the Volkswagen scandal is the introduction of tougher pollution regulations by the United States and the European Union and the deliberate attempts by the company to cheat in tests. Concerns on the effects of automobiles on pollution have led to the need for guidelines that organizations must follow to manage the issue. Consequently, the EPA decided that it was possible and necessary for all vehicles sold in the country to lower emissions of NOx to 0.07g/mi or lower. Rather than abide to the regulations, the company used a defeating device that lowered emission levels during resting to conceal the performance of their vehicle in normal use circumstances. Volkswagen received the approval to sell cars in the United States and received tax breaks for their emission management system. The incident involves a professional ethical issue since the organization deliberately violated the government’s regulations on safety. Emissions from vehicles can cause respiratory problems and, in some cases, lead to premature deaths among the people exposed to harmful gases. Volkswagen’s actions amounted to potential health risks for the general population and it was the responsibility of the professionals at the organization to intervene. The occasion in the triangle for self-interest in the Volkswagen triangle involves the professional’s dilemma in dealing with the company’s actions to interfere with the tests of its products....