Foundation of our daily actions

For us, living integrity as an example means doing the right thing in a professional context on the basis of our own convictions. This means complying with our Group Essentials and the ethical principles established therein and behaving correctly in accordance with rules. This also includes the steadfastness needed to adhere to these principles – regardless of economic and social pressure.

In our opinion, it is not enough to base correct behavior solely on rules and guidelines, but it takes attitude to do the right thing, even if no one is looking. Integrity is an attitude that represents an inner compass for correct action in grey areas, in the absence of explicit rules or in the event of conflicting goals.

Integrity is the maxim for our actions and complements compliance, with which ensures that all processes and decisions within our Group comply with the relevant rules. Together, they shape our corporate culture, which unites the unspoken and pronounced rules and values relating to our daily cooperation.

Whether it is possible for each individual to act with integrity is an explicit question in the Opinion Survey, the annual survey of all the Group’s employees. The question is: “In our organizational unit, is it possible for everyone to act with integrity”. If employees think this possibility is in doubt in a particular organizational unit, the relevant manager must identify and clear the possible obstacles together with the team. The question was asked in the Opinion Survey for the first time in 2017 and since then, including in the reporting year, has been one of the three questions with the highest level of agreement. The conduct anchors were developed in order to breathe life into the concept of integrity and make clear to employees what acting with integrity in their day-to-day work means. They serve as practical guidelines for action and at the same time set a normative expectation regarding what is considered “correct conduct” in the Volkswagen Group. These defined “conduct anchors” will also form the frame of reference when integrity becomes an obligatory topic in employee appraisals from 2020.

As role models, managers are among the greatest factors influencing employee conduct. In order to further strengthen this function as a role model and further develop their skills, the Role Model Program 2.0 was introduced in 2019 to encourage dialog-oriented and distance-reducing collaboration. The managers are to be equipped to ensure a culture of open discussion in their own team, where risks or conflicting objectives can be discussed without fear of sanctions and employees are encouraged to contribute their questions and ideas. Beyond their own conduct, however, managers also have the task of purposefully encouraging and demanding the right conduct among their employees. One of the ways in which support is given to them is through formats that are provided via the Opinion Survey method toolbox.

Motivating our employees and spurring them to action is also critically important. The integrity program therefore ensures permanent visibility of the topic through continuous communication both in employee media and in personal discussions. For example, information about the integrity program is regularly provided at works meetings, in individual departments, in the integrity workshops, in front of shop stewards or also vocational trainees. The T4I perception workshops are also used as platforms for discussing integrity and compliance. In addition, as the Director of Integrity and Legal Affairs, Hiltrud D. Werner regularly meets with employees from various departments on the dialog bus tour for direct discussion about integrity-related challenges in day-to-day work.

However, the people who promote the topic of integrity of their own accord, who embed it within the structures of the Group and keep the topic alive – the integrity ambassadors – are also of key importance. It was possible to expand the network of them again in 2019. The number of these voluntary disseminators at Volkswagen AG rose from 200 to more than 400. Worldwide there are already more than 700. This suggests an improved understanding and higher acceptance of the topic of integrity as well as greater willingness by employees to openly address problematic aspects where necessary.

In selected departments, the integrity program also creates centers of excellence, which are used for in-depth, department-specific analysis of the topic of integrity. The change measures developed by employees are later reviewed to see if they can be transferred to other departments and, if suitable, are recommended Group-wide as best practices. In 2019, there were centers of excellence in Germany, Italy, Spain, the USA and South Africa. The number of them has risen to a total of 26 since 2018.  

Another focus of activities is the integration of integrity in as many HR processes as possible. For example, integrity has been a criterion in the recruitment process and in staff development of managers since 2019. Integrity was also taken into account as a required component of performance-related remuneration from the Board of Management to management level. Training and presentation documents aimed at specific target groups are used to provide information for new and existing employees and ensure that they have the competence they need.

In addition to the Opinion Survey, we also use the integrity index in order to measure our progress in integrity and compliance. The index was developed in cooperation with the holder of the Peter Löscher Chair of Business Ethics at the Technical University of Munich (TUM) and comprehensively represents the integrity of an organization.
We also use it as a key performance indicator in the Group initiatives on the “Excellent Leadership” module of the TOGETHER 2025+ strategy. The index is cross-sectoral and global and of high scientific validity.

It includes established frameworks such as the ECI and the Global Reporting Initiative (GRI). The index covers weaknesses in integrity and compliance matters and makes changes in the thinking and conduct of managers and employees visible.

We started the integrity index in 2019 as a pilot project for Volkswagen Passenger Cars Germany and AUDI AG (German sites). More than 100 measuring points in the compliance/infrastructure, working atmosphere/integrity culture, product/customers, society and partner/markets categories were collected and evaluated by Business Ethics experts. The analysis is based both on internal sources, such as employee surveys, guidelines and management interviews, and on external data, such as international databases and interviews with experts. Both the companies examined – Volkswagen Passenger Cars and AUDI AG – exhibit a good integrity level overall. However, the detailed results signal a need for action in various places. Following a decision by the Board of Management, the findings will now be used in a structured follow-up process in order to derive and implement improvement measures together with the departments. The aim is to raise the integrity level at the two pilot companies to the next level. This improvement is to be confirmed with the planned follow-up integrity index survey at Volkswagen Passenger Cars and AUDI AG in the first quarter of 2021.