VW boss Blume wants to take off and quickly make the group fit for the future. But when it comes to discussions with the shareholders, problems come up above all – even with unusual actions.
With the introductory words of the chairman of the supervisory board, Hans Dieter Pötsch (72), it became clear at the first ordinary general meeting of the Wolfsburg car giant after the corona pandemic that the management cannot count on great harmony. A cake throw in the direction of Wolfgang Porsche (80), representative of the owner family, missed its target, but gave the managers on the podium a startle early on.
Road blockades on access roads, climate protests in front of the assembly building in Berlin, orchestrated disruptive actions in the hall on Wednesday – all of this showed the environment in which the car company moves. The criticism was aimed at how Wolfsburg was dealing with the diesel scandal and the human rights situation in China, but also at the sale of combustion cars.
Oliver Blume and his ten-point plan
The new VW boss Oliver Blume (54) actually wants to demonstrate decisiveness above all. He spoke to the shareholders about his ten-point plan, which is intended to secure the carmaker’s position at the turning point towards electromobility and the connected car. Blume recently took action at the ailing software subsidiary Cariad and replaced large parts of the management – the expensive delays of the past should finally be history thanks to a new project management.
Last week, the group presented business figures for the first three months, which pointed downwards in profits due to the financial valuation of raw material hedging transactions – but in actual day-to-day business things looked better. Blume even found confident words in the past few days about the difficult situation in the sale of cars in China, the most important market.
Human rights problems in China
But Blume also had to interrupt his speech to investors when a shirtless activist with a placard loudly disrupted his lecture, wanting to draw attention to human rights problems in China. It shouldn’t be the last disruption.
VW operates a plant in the Chinese province of Xinjiang with a joint venture. According to human rights organizations, the Muslim Uyghur minority living in the province is being specifically suppressed by the government in Beijing. VW is accused of not doing enough against alleged forced labor at local suppliers.
VW counters that there are no signs of human rights violations in the plant with 240 employees. The group stands up against forced labor worldwide, said Legal Director Manfred Döss.
It is not unusual for activists to use the environment of general meetings for their concerns. In the hall, however, you rarely see such protests, also because of the security measures at the entrance. The VW Group responded to the protests with a statement. “A constructive exchange is important. And a general meeting offers a good opportunity for this,” it said. “Except for a few, everyone adheres to the rules provided for this.”
Critics: More questions than answers
But shareholder associations and fund companies were also dissatisfied with the VW leadership. Marc Liebscher from the Protection Association of Investors complained that shareholder representatives had been asking questions about good corporate governance and other problems for years, but had received hardly any answers. It seems to him that “we shouldn’t be surprised that these forms of protest are now being expressed here,” said Liebscher. Janne Werning from the fund company of the Volks- und Raiffeisenbanken, Union Investment, called for an independent investigation into the situation in Xinjiang – and received applause.
For shareholder representatives, Blume’s dual role as head of the VW Group and Porsche is a cause for concern. Ulrich Hocker from the German Protection Association for Securities Ownership admitted that the management of the sports car subsidiary Porsche represented a certain fascination for a car fan. “But both together, that’s not possible,” he criticized. “Shareholders want a CEO who can concentrate fully on one task,” said Hendrik Schmidt of Deutsche Bank’s fund subsidiary DWS. “We hope that reason will soon return to Wolfsburg and that you resign from the Porsche mandate,” said Ingo Speich from the savings bank fund subsidiary Deka Invest Blume.
Around 700 shareholders came
In front of the approximately 700 shareholders present, Blume said that VW and Porsche largely have the same interests, so conflicts of interest are not to be expected – and these have not arisen during his term of office. If the worst comes to the worst, precautions have been taken to avoid conflicts of interest.
There has also been criticism – a long-running issue for years – of the small gap between the preferred dividend and the ordinary shares with voting rights. Nevertheless, all of the company’s proposals were approved by the shareholders with voting rights, including the re-election of major shareholder Wolfgang Porsche to the Supervisory Board for a full term, even though he had long since passed the statutory retirement age of 75 on his 80th birthday.
The majorities at Volkswagen are clearly distributed. The holding company of the Porsche and Piëch families, Porsche SE, holds the largest share of voting rights at 53 percent, ahead of the state of Lower Saxony with 20 percent and the sovereign wealth fund from Qatar with 17 percent. The preferred shareholders – and thus the majority of small investors – have no voting rights.
It also went through that the board of directors can only hold the annual general meeting online without being present. Loud criticism like this Wednesday would no longer have to be feared by management online.
Source: Stern
