This activity is important because, as a manager, you must be able to understand the importance of corporate social responsibility, developing sustainable strategies, and how to ensure that decisions make good economic and social sense. The goal of this activity is to demonstrate your understanding of ethical considerations in international business.

Audio 1

Berlin speaker: "Juergen, first of all thats an ambitious goal;"

Juergen: "Morning."

Berlin speaker: "three hundred models including, umm, you know Porsche 911, a Ducati Monster, a Lamborghini Aventador. Are we going to see electric versions of all of these cars?"

Description 1

Opening screen: An older gentleman in casual business clothes facing the viewer. In the background are two different car models with a few people walking around. Screen transitions to 3 people, left to right: a woman with caption "London"; a man with caption "Frankfurt"; a man with caption "Berlin". Heading at bottom of screen: Bloomberg. Volkswagens Electric Future.

Audio 2

Juergen: "Well basically, Im representing Volkswagen brand here and if a Volkswagen passenger car, clearly thats our goal. So basically, for every car you know of our brand, the key models Golf, Tiguan, Passat, and any other models that are representative of our brands today, we will have actual full electric equivalents in our range. And you see cars behind me that are no longer real show cars. They are actually really pointing at our series production intent starting in 2020. Volkswagen brand is really full steam on the electric march. We have dedicated a lot of our research and development, a lot of our financial resource, to really bring to life our dream of becoming world leader in electrical mobility basically from start in 2020. So, its true for the Volkswagen passenger cars, yes, you can have a Volkswagen electric basically in all sizes and in all body types."

Description 2

Focus on Juergen Stackman, former Ford Germany General Manager of Sales & Marketing, VW Brand Sales Chief. Heading at bottom of screen: Bloomberg. VW Has Pledged to Offer Electric Versions of Every Model by 2030.

Audio 3

Berlin speaker: "So I saw, I was lucky enough, Juergen, to get to come by your stand yesterday. I saw some really cool new products from the T-Roc to the Arteon. Im looking at that bus behind you and Im wondering, 'Will we really be able to get an electric VW bus by 2020?'"

Description 3

Screen returns to 3 people. Heading at bottom of screen: Bloomberg. What Will Shift Away from Fossil Fuels Mean for VW?

Audio 4

Juergen: "Well, basically our commitment since Pebble Beach two weeks ago is to bring this vision of the ID Bus to life. So, weve committed ourselves to actually produce the car. It has been sort of a really global attraction, this car, since weve shown it the first time. Because it brings back the spirit of the original from the 60s, which basically was created in its spirit in California, was a West Coast dream. And its only doable, actually, in an electric form, because you need to get the proportions right for the car. So yes, the car is committed as a real plan. We bring it to life, it's not gonna be 2020. The first car that comes to life is our original ID. Its a compact car in the Golf size for European roads, and we try to bring it to life, actually, at the price of a Golf diesel today. So, a mainstream price for a mainstream customer with ambition. But actually, the ID Bus, which obviously is a car that everyone wants to have, is gonna be launched shortly after. Its going to be a sequence of many cars coming in a short time frame after the beginning of 2020 to really make sure that everybody understands the Volkswagen brand is really serious on the electric wave."

Description 4

Juergen. Heading at bottom of screen: Bloomberg. Stackmann: VW Is Really Full-Steam on Electric Models.

Audio 5

London speaker: "Okay, really serious on the electric then. Juergen, good morning to you. Whats your estimate of how frequently"

Juergen [interrupting]: "Morning."

London speaker: "customers will replace electric vehicles? How frequently will they buy new ones? Because some analysts suggest theres less to go wrong in an electric car, and that means people will replace them less frequently, and there will be less work to do in repairing them as well."

Description 5

Screen returns to 3 people. Heading at bottom of screen: Bloomberg. Stackmann: Theres Going to Be a Sequence of Many Electric Cars Coming.

Audio 6

Juergen: "Well, ours is not the only estimate because we have good knowledge from the Norwegian market, which basically is an experienced electric market. And we are basically benchmarking ourselves with Norway all the time. Volkswagen is market leader on electric market cars there already today. And we do know, actually, the frequency of change is the same as regular cars. People want used, they want new cars, fresh designs. Something interesting to talk about on a regular basis. So the normal frequency is basically determined either by the financing scheme, which usually is about 3 to 4 years and the people actually are intending to trade their car. Or, actually if people want to live in their car and want to keep their car, its gonna be a 10 year term. But we dont estimate a big change in the frequency of changes in electric cars. Because people dont really change cars because theyre breaking. They want a new car, they want the latest update, and they want to be seen in the latest model design. Thats the key reason for changing a car. And we make absolutely sure that the cars are lasting. Theyre batteries will have good capacity, actually even after 9 or 10 years actually in service. So, we treat actually, electric mobility as normal, and I think when we get to the stage people think electric as a normal car that we will have achieved our goal. Its fantastic to drive but it should not be something extremely special."

Description 6

Juergen. Heading at bottom of screen: Bloomberg. Stackmann: Theres Going to Be a Sequence of Many Electric Cars Coming. Heading changes to: Bloomberg. Stackmann: VW Is Very Serious About Move into Electric. Then heading changes to: Bloomberg. Stackmann: VW Watches Norwegian Market on Electric Car Outlook.

Audio 7

Berlin speaker: "I wonder about, you know, 'company-wide' youre gonna boost cap ex by 20 billion, you got orders out for 50 billion Euros worth of goods. Are you gonna have to take that from somewhere else? Are you going to have less of a focus for example, Juergen, on smaller diesel cars?"

Description 7

Screen returns to 3 people. Heading at bottom of screen: Bloomberg. Stackmann: VW Watches Norwegian Market on Electric Car Outlook. Heading changes to: Bloomberg. Stackmann: VW Is Really Full-Steam on Electric Models.

Audio 8

Juergen: "Well I think what you have seen here in our show, Stan, is that Volkswagen is actually doing two or three things actually at the same time. Were investing into SUVs today because the world wants SUVs. That's the body type that actually people usually want from us. Youve seen the T Roc yesterday. Its a fantastic model that really attracts people today. So, we are focusing basically on those cars which are in demand today."

Description 8

Screen transitions to Juergen. Caption: "Bloomberg. Stackmann: Theres Going to Be a Sequence of Many Electric Cars Coming." Caption changes to "Bloomberg. Stackmann: VW Is Very Serious About Move into Electric."

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Question 1a: With its goal of offering a complete line of electric cars beginning in 2020, VW is

a. trying to capitalize on the tragedy of the commons.

b.demonstrating its commitment to pursuing a sustainable strategy.

c. hoping to evoke a feeling of nostalgia among older customers.

d.hoping to mitigate conflict over local emissions regulations.

e. eliminating head-to-head competition with other carmakers.

Question 1b: When considering the implications of its decision to provide an electric version of its cars, VW

a. must use moral imagination.

b. should avoid moral courage and focus on cultural relativism.

c. put the demands of shareholders above stakeholders.

d. must engage ethics officers to ensure the legality of its decisions.

e. should encourage noblesse oblige at the expense of corporate social responsibility.