Like many others I think this story is going to run and run. Probably of greater significance is the impact commercial vehicles have (or not) but that has yet to be reported. The scope of damages is potentially huge not only with regard to reputation but also financially. Little has been said yet on the taxation issues in particular with regard to company cars and benefit in kind. Surely lower reported CO2 figures will have resulted in a skewed market as company car drivers choose lower polluting cars and therefore paid a lower tax.

Matthew Lynn makes some interesting observations today in the Daily Telegraph. He talks about the large number of global corporates who are leaders in Corporate Social Responsibility (CSR) noting that VW were reported to be 11th in the world ranking. Yet he also argues that CSR has become a "global racket - and a dangerous one. It allows companies to parade their virtue, and look good, while internal standardsa re slipping". Last year VW collected a "Gold Medal Award for Sustainable Development" and only last week it collected the Dow Jones Sustainability Award for the best in the automotive sector. 

VW are not alone, BP and Enron also made substantive claims on their CSR performance.  CSR reporting has become mainstream, allegedly over $15Bn is spent annually by Fortune 500 companies on CSR work. Matthew Lynn concludes his article by saying that CSR departments are providing moral cover for these companies whilst allowing standards to slip. Furthermore he argues that CSR has become a racket and should be closed down and for companies like VW to get on with cleaning up their behaviour where it matters.

I can't fully agree with Matthews conclusion as there is a lot of good work done by CSR departments. They have in many cases (and often pre CSR era) made significant strides in reducing energy consumption, reducing waste and using resources more efficiently. You have to believe that majority of staff in these CSR departments were and are acting responsibly and are doing the "right thing". Possibly CSR is going the same way as "environmental management" and "sustainability", I believe that after a period of time they become the norm and simply something that has to be done in the corporate world. The only goal is seeing how far up the ranking you can get.

The VW case really does show the absence of one key ingredient, integrity. This case just goes to prove you can spend as much as you want and pick up the shiny gong from the awards dinner and give yourselves a pat on the back. Doesn't mean a thing when someone further up the corporate pyramid has Plan C to make everything look good!!

Finally I also think that another potential consequence of this global media fenzy is that companies choose to report much less. VW's latest CSR report ran to 156 pages. Hands up who actually read all of it?

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