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Faster, Higher, Farther: The Volkswagen Scandal
Jack Ewing, 2017, 352 pp.
W.W. Norton & Company, Inc.
500 Fifth Avenue
New York, N.Y. 10010 
 
Faster, Higher, Farther: The Volkswagen Scandalpresents the Volkswagen emission scandal from a mostly historical perspective without much lengthy discussion on engineering technicality. Jack Ewing, a New York Times journalist, has devoted a considerable portion of the book on telling the story of Ferdinand Piëch—the key leader of Volkswagen (VW) delving into a wide range of VW’s pivotal events in connection with the Piëch and Porsche family. Meanwhile, he maintains a parallel storyline regarding the technological and regulatory developments in the United States. The later part of the book is largely an analysis of the scandal per se including the direct confrontation between the VW (and its legal team) and the regulators and judiciaries who are underpinned by the findings from academic research.

As the title of the book has ostensibly alluded to, one of the main ideas conveyed seems to be how VW’s tone at the top has shaped the firm’s corporate identity, and thus by extension, the creation of the scandal and how its management has dealt with it. Curiously, a practitioner might ask whether everything that might be said about the Volkswagen emission scandal has not already been well covered in various court documents and media coverages, and what professional or academic values could this book offer? 

A practitioner could use this book as another case study opportunity to have a cohesive review of a recent debacle that sheds new lights on many classic corporate malfunctions. For salutary lessons, one would find the author’s description of some problems relating to VW’s internal controls to be of interest, especially the inadequacy of segregation of duty, the lack of engineering regulatory knowledge in the legal department, and the limits of VW’s whistleblower system, among others.

There are many other noteworthy high-level risk management insights included in the book; one is that VW’s reputation of being “green”, attention to detail, and striving for high quality has, over the years, attracted highly-educated customers, whom in turn would not react well to corporate malfeasance or deception. Therefore, a recognized brand image of meticulousness combined with an epic exposé of internal flaws or perceived ill-intention could do much more damage to public confidence. Ineffective cooperation with a regulator as a result of corporate misfunction is another daunting risk which remains difficult to manage, even in a well-established institution. VW’s predicament highlights the gravity of such risks in a global competitive landscape.

The book also contains a plethora of examinations on the web of inter-corporate and inter-personnel relationships, and thus it provides many behind-the-door views of an intriguing global empire with so called “provincial” mentality. For example, the author portrays the auto-workers at VW to be an enormously influential corporate force, backed by politicians, a powerful union, and prerogatives guaranteed in German laws. In this regard, the author provides various stories how upper-management handles worker and mid-management relationships in the contexts of the firm’s unique environment. Additionally, there is no shortage of examples of hindsight suggestions on how, via some actions at top or mid-management level, the emissions scandal could have been prevented or remediated before it morphed into a dire catastrophe. Notwithstanding the astute analysis, this work could have been more value-adding to forensic accountants and internal auditors had the author gone through a more in-depth examination into the extent in which worker or worker vis-à-vis top management bond has directly affected the emission debacle. Such value would also have been greater had he presented a more comprehensive analysis on the roles of internal and external auditors in context of the firm’s historical culture or the roles they specifically played in the emission debacle. Where there red flags that were missed?

Perhaps the most salient quality of this book’s valuable to a practitioner is the collection of the author’s own extensive analysis. While many companies build defeat devices to handle emission tests, why was VW “singled out” for punishment? While there were other graver violations in which direct death had resulted, why was VW’s emission violation, which had resulted in no direct deaths, punished to such a substantial level? The author has methodically addressed such questions, putting forward his own insightful conclusions. This book contains many cautionary tales; chief among them is that a firm’s culture is one of the most important advertisements for the products that the firm has to offer. Tone at the top is important.

By Jimmy Ma