30 million for 3 years? Debate on the replacement of Diess at VW | Free press

The resignation of the VW boss may not seem too surprising. That the board of directors makes that decision in summer 2022, yes. And some ask why they didn’t intervene sooner.

Wolfsburg / Stuttgart.

The replacement of VW boss Herbert Diess by Porsche boss Oliver Blume, scheduled for September, is causing discontent among some investors and industry experts. The question is why Diess, which will be equipped with an advisory function in the future, prematurely received a new contract just a year ago.

In July 2021, the Supervisory Board approved a further commitment that will last until October 2025 – although there has been serious criticism of Diess’ management and communication style for several quarters now.

“The contract extension from last year is incomprehensible,” said Ingo Speich, director of business management and sustainability at Deka’s savings fund subsidiary Ingo Speich, a German news agency. Diess resignation is an “announcement trip”, inspectors could have drawn the consequences much earlier. Diess himself is said to have put pressure on the extension. “Once again, the bill is borne by the shareholder,” said Speich. “The new consulting contract also raises more questions than answers.”

10 million a year

For 2021 alone, Diess received more than € 10 million, including pension rights. VW board salaries are difficult to compare and accurately predict over time as they depend on bonus variables. Some observers estimate that the previous president – although he will no longer be in this position – by the autumn of 2025 may earn even another 30 million euro.

“A golden handshake is a sign of bad corporate governance and, unfortunately, it has a tradition at VW,” criticized Janne Werning from Union Investment. Highly paid continuing wages or severance payments had already been agreed with Bernd Pischetsrieder in 2000 or with the legal director Christine Hohmann-Dennhardt, who stayed there for just over a year in the 2016/2017 season. Another analyst said the practice was “a mess” in his opinion, especially since at the same time there were rumors of tens of thousands of job cuts for Diess.

The investor protection association spoke of “a supervisory board without a compass, which says Hü one year and Hott the other.” This is tantamount to a “strategic deterioration in performance”.

The board maintains a low profile

As regards the confidentiality of the meetings, members of the body did not want to comment on the decision at the time, even in the light of the events before it. In 2020, Diess even accused parts of the board of directors of criminal behavior and “lack of integrity” through indiscretion. Initially, he was president of the largest European car group until spring 2023. However, there have been several conflicts with the works council, IG Metall and the Land of Lower Saxony, which, along with the representatives of the Porsche / Piech owners’ families, are the most important supervisors.

In addition, there have been costly delays in proprietary software recently that have reportedly threatened model launches. In the past year, none of the key players dared to break with Diess, it was said in the environment of inspectors – in retrospect, you are often wiser. But now you’ve realized that it just can’t go on anymore. (dpa)

Leave a Comment