Volkswagen Emission Scandal: A Kaleidoscope Of Governance
Introduction – A Kaleidoscope of Governance
Since the last international climate conference in Copenhagen in 2009, political narrative has focused on filling policy gaps in the environmental governance regime. Supra-territorial ‘global commons’ problems such as greenhouse gas emission require transborder solutions as globalizing corporations increasingly stretch across different national regulatory regimes. In response, the incipient polycentric governance approach promotes cross-influence among public and private institutions at various governance levels from local to global. Notwithstanding, corporate frauds such as the Volkswagen emission scandal in 2015 reflect the risk inherent in greater reliance on polycentric governance and question …show more content…
The unsustainable use of global atmospheric sinks for greenhouse gases by corporations reflects modern challenges to implement governance strategies to conserve common-pool resources and constrain transboundary pollution (Steger, 2013:92, Dalby, 2014:47). As classic rational choice theory predicts, self-interested corporate free riders will not act altruistically and reduce energy use unless “an external authority imposes enforceable rules”. (Ostrom, …show more content…
Spectacular corporate failures such as the Volkswagen emission scandal disclosed in September 2015 reflect that CSR remains a greenwash marketing exercise to maximize shareholder profits (Boston, Varnholt & Sloat, 2015). According to the Wall Street Journal, the company deliberately installed a defeat device to circumvent emission control – a stratagem at highest level - on nearly 11 million vehicles to overcome its struggles of gaining traction in the US market (Boston, Varnholt & Sloat, 2015). The introduction of its supposedly environmentally friendly clean diesel engine granted the company a comparative advantage over its competitors. Hence, voluntary bottom-up initiatives cannot avert the tragedy of the commons if MNEs operate in what Peter Schwartz and Blair Gibb call the “gray area” (O’Callaghan, 2007:96). As corporate sustainability reports “do not rest on any system of accountability, democratic or otherwise” (Haufler, 2006:101), self-regulatory mechanisms offer little transparency (Jordan,
Since the last international climate conference in Copenhagen in 2009, political narrative has focused on filling policy gaps in the environmental governance regime. Supra-territorial ‘global commons’ problems such as greenhouse gas emission require transborder solutions as globalizing corporations increasingly stretch across different national regulatory regimes. In response, the incipient polycentric governance approach promotes cross-influence among public and private institutions at various governance levels from local to global. Notwithstanding, corporate frauds such as the Volkswagen emission scandal in 2015 reflect the risk inherent in greater reliance on polycentric governance and question …show more content…
The unsustainable use of global atmospheric sinks for greenhouse gases by corporations reflects modern challenges to implement governance strategies to conserve common-pool resources and constrain transboundary pollution (Steger, 2013:92, Dalby, 2014:47). As classic rational choice theory predicts, self-interested corporate free riders will not act altruistically and reduce energy use unless “an external authority imposes enforceable rules”. (Ostrom, …show more content…
Spectacular corporate failures such as the Volkswagen emission scandal disclosed in September 2015 reflect that CSR remains a greenwash marketing exercise to maximize shareholder profits (Boston, Varnholt & Sloat, 2015). According to the Wall Street Journal, the company deliberately installed a defeat device to circumvent emission control – a stratagem at highest level - on nearly 11 million vehicles to overcome its struggles of gaining traction in the US market (Boston, Varnholt & Sloat, 2015). The introduction of its supposedly environmentally friendly clean diesel engine granted the company a comparative advantage over its competitors. Hence, voluntary bottom-up initiatives cannot avert the tragedy of the commons if MNEs operate in what Peter Schwartz and Blair Gibb call the “gray area” (O’Callaghan, 2007:96). As corporate sustainability reports “do not rest on any system of accountability, democratic or otherwise” (Haufler, 2006:101), self-regulatory mechanisms offer little transparency (Jordan,