Corporate Social Responsibility and Sustainability

The Volkswagen Group is committed to transparent and responsible corporate governance. The greatest challenge in implementing this across all levels and every step of the value chain is our complexity: with 12 brands, over 100 production locations and more than 590,000 employees, we are one of the largest companies in the world.

Our Strategy 2018 sets the pace: the Volkswagen Group is aiming to become the most successful, fascinating and sustainable automobile manufacturer in the world by 2018. Sustainability means simultaneously striving for economic, social and environmental goals in a way that gives them equal priority. To us this means creating enduring value, facilitating good work, and using the environment and resources with care. Thanks to its corporate culture, Volkswagen is better suited than almost any other company to combine a modern understanding of responsibility and sustainability with the traditional values of running a business to form an integrated corporate social responsibility (CSR) approach. Our CSR concept is aimed at ensuring that we recognize and manage at an early stage risks and development opportunities in the areas of environment, society and governance at every step along the value chain, and further improve our reputation. This is how our CSR activities contribute to increasing our Company’s value in a long-term and sustainable way.

Management and coordination

The Volkswagen Group has established a clear management structure for coordinating CSR and sustainability. The supreme sustainability board is the Group Board of Management (Sustainability Board). It is regularly informed by the Group CSR & Sustainability steering group on the issues of corporate responsibility and sustainability. The Group CSR & Sustainability steering group’s members include executives from central Board of Management business areas and representatives of the Group Works Council and of the brands and regions. Among other things, the steering group makes decisions on the strategic sustainability goals, monitors the extent to which they are being met using management indicators, identifies key action areas and approves the sustainability report.

The CSR & Sustainability office supports the Group CSR & Sustainability steering group. In addition to coordinating all sustainability activities within the Group and the brands, its duties include running the stakeholder dialog, which is held at Group level, for example with sustainability-driven analysts and investors. CSR project teams work on topics across business areas, such as reporting, stakeholder management, or issues relating to sustainability in supplier relationships. This coordination and working structure is also largely established across the brands and is constantly expanding. Since 2009, the CSR & Sustainability coordinators for all brands and regions have met once a year to promote exchange across the Group, establish consistent structures and learn from one another. This Group CSR meeting has proven itself as an integral part of the Group-wide coordination structure.

With the help of our IT-based sustainability management system, we again gathered comprehensive data and information in near real-time in 2014 for Group sustainability reporting. At the same time, we expanded our sustainability management system to further increase transparency and the quality of the data, so that we can monitor CSR risks more easily and better identify CSR opportunities.

Code of Conduct and guidelines

Our Code of Conduct, which is applicable throughout the Group, provides guidance for our employees in the event of legal and ethical challenges in their daily work. It embodies the Group values of customer focus, top performance, creating value, renewability, respect, responsibility and sustainability. All employees are equally responsible for adhering to these principles.

International conventions, regulations and internal rules are also key guidelines for our conduct. We also acknowledge our commitment to the “Declaration on Social Rights and Industrial Relationships at Volkswagen” (Volkswagen Social Charter), the Charter on Labor Relations and the Temporary Work Charter, all of which address fundamental human rights, labor standards and principles.

Strategic stakeholder management

We cannot guarantee success in the long term without knowing the expectations of our stakeholders or actively communicating with them. As the complexity of the Volkswagen Group increases, so do the expectations of and our network of relationships with the various stakeholders. Our exchanges with them cover many aspects, ranging from expectation management to innovation momentum, down to identifying opportunities and risks. We are open to a constructive and equitable dialog where we learn from one another, but to which we can also contribute our own interests. Our goal is to agree on a common solution, but at the very least to gain a mutual understanding on our initial situation and positioning.

Our brands in particular hold comprehensive stakeholder dialogs that we combine at Group level to discuss Group-wide issues in detail. These include our membership of organizations that hold in-depth discussions on issues related to sustainable development. At an international level, we are involved in the World Business Council for Sustainable Development (WBCSD) and participate in CSR Europe, a leading European business network for corporate responsibility. In addition, we are represented on the board of econsense, the Forum for Sustainable Development of German Business. We transfer the knowledge we gain from this to the brands and the regions.

Since 2002, we have also been committed to the UN Global Compact, the largest and most important CSR initiative in the world. Over 12,000 participants from more than 145 countries work together to shape a more sustainable and equitable world economy. The Volkswagen Group and its brands make a significant contribution to this initiative. The values of the Global Compact comprise ten principles governing human rights, labor standards, environmental protection and the fight against corruption. We achieved the “Global Compact Advanced Level” in 2014 again thanks to our progress report on implementing these principles at our locations. Furthermore, we use our expertise to help other companies in the Global Compact to embrace their global responsibility, for example through our active participation as a standing member of the advisory board for the “Sustainable Supplier Chain” project.

We publish information about the stakeholder dialogs in our annual sustainability report so that our interaction with stakeholders is understandable. Stakeholder management is steered and coordinated by the Group CSR & Sustainability steering group, the Group’s CSR project team, and the brand and regional project teams. Since we selectively choose relevant departments for the project teams, we are also able to respond to the many requirements of the stakeholders concerned within a short time.

Our stakeholder management consists of a variety of instruments: dialogs, workshops, symposiums, public debates, social media, questionnaires, evaluations and projects. In order to coordinate these activities at strategic level, we document them in an IT-based stakeholder management system that is individually tailored to the Volkswagen Group’s requirements. Since 2014, it has supported us in connecting the relevant stakeholders to the key issues for the Company.

In 2014, we used the results of the comprehensive stakeholder questionnaires from brands and companies to identify these key issues. In order to systematically prioritize the issues identified, we evaluate them using the latest international sustainability studies and benchmark them against the guidelines and conventions that Volkswagen is committed to. Internal bodies that also involve all brands and regions discuss and evaluate the key issues. These discussions center around three main criteria:

• the expectations of stakeholders,
• the significance for the Company and
• the extent to which the Company can influence these issues.

The results give us the Volkswagen Group’s key action areas for achieving our goal of becoming the most sustainable automotive company in the world.

CSR Projects

The Volkswagen group initiates and manages a variety of CSR projects around the world, which are based on the following key principles:

• They are compatible with the Group’s principles while at the same time addressing a specific local or regional issue.
• They demonstrate the diversity in the Group and in the social environment in which the projects are implemented.
• They are the result of close stakeholder dialog with the local players involved in implementation.
• Project management is the responsibility of the local units working on the project.

VOLKSWAGEN GROUP'S KEY ACTION AREAS

The Volkswagen Group supports a large number of projects that promote the arts and culture, education, science, health and sport, or that serve to develop regional structures and conserve nature. These projects make CSR a learning platform for all brands and in all of the Company’s regions. Our long-standing cooperation with the German Nature and Biodiversity Conservation Union (NABU), the contact we have to our local neighborhoods at many Group locations and our cooperation with the German Red Cross (DRK) are examples of this.

NABU has worked with Volkswagen AG for many years and, since the end of 2012, this alliance has been based on a new, expanded cooperation and advisory agreement. NABU is a strategic partner for Volkswagen on the Group’s path to becoming the most environmentally friendly automobile manufacturer in the world.

For over 15 years, Volkswagen Commercial Vehicles at the Hanover location has fostered extensive dialog with its neighbors; the plant there is in close proximity to residential areas. This made it possible to build up a climate of mutual understanding. In addition to communicating with its neighbors, the focus of the Poznan location in Poland is on long-term initiatives to support and promote local community projects.

Humanity, public spirit and responsibility – these are the values on which the work of the German Red Cross is based, and which we also share in the Volkswagen Group. We are promoting sound, balanced social development, in Germany and at our other international locations. As part of its strategic partnership, the Volkswagen Group thus helps the German Red Cross to find even more people who are willing to volunteer their time. This goal is central to the partnership, in conjunction with strengthening the Red Cross’s rescue service.