Charles M. Elson, professor of finance and director of the John L. Weinberg Center for Corporate Governance at the University of Delaware, had this to say about the current Volkswagen scandal in which the company rigged automotive software in at least half a million of its diesel-powered cars to cheat on U.S. pollution tests (and there’s a chance the same ruse was used in Europe where as many as 10 million cars might have the shady software):
The governance of Volkswagen was a breeding ground for scandal. It was an accident waiting to happen.
It takes a real intellectual to point out the obvious, to wit: VW’s “supervisory board,” dominated by Ferdinand Piëch from 2002 until his ouster this past April, was such a joke that shareholders elected Piëch’s fourth wife, a former kindergarten teacher and his former governess, to the board in 2012. Well, even an educator of five-year-olds should know that after getting caught misbehaving as deplorably as VW has, it’s probably best to keep a low profile. So what did the company, founded by the German Nazi government in 1937, do for an encore?
Like a mid-binge drunk figuring that there’s no point in wasting a bottle that’s half-finished, it threw itself a big party, with Lenny Kravitz providing the musical entertainment. As reported by the New York Post:
Kravitz — paid an estimated $500,000 by the German auto giant — performed for an hour with a full band at a lavish party the company threw for its new Passat at the Brooklyn Navy Yard on Monday, hours after news broke that Volkswagen admitted using software to deceive US regulators measuring toxic emissions in its diesel cars.
At least it worked out for Kravitz: He took VW’s $500K but was clever enough to endorse Jeep. He was probably the smartest person at the party.