Volkswagen’s recent annual general meeting (AGM) sparked an interesting week in activism with online, in-house, and in-person protests, including the Freedom United community and our partners.
Cake was thrown, tweets were sent, and prominent stakeholders, including Deka, Union Investment, and the Umbrella Organisation for Critical Shareholders, called for an immediate independent audit of the company’s plant in the Uyghur Region of China.
China chief’s word is no longer good enough
During a previous visit to the plant in February 2023, Volkswagen’s China chief claimed to have found no signs of forced labor. At the AGM, he proclaimed, “I have no reason to doubt my impressions or the information available to me.”
His “impressions” clearly did little to sway investors.
Victoria Waldersee for Reuters reports,
“This audit must be carried out promptly for Volkswagen to remain investable,” Janne Werning of Union Investment said, adding it must also be done by a reputable firm and the results shared publicly in full.
Ingo Speich, head of sustainability and corporate governance at Volkswagen top-20 shareholder Deka, commended the decision to move ahead with the audit as a “clear signal towards creating transparency,” but said a recognised firm must run the audit.
Still, a sweeping crackdown on consultancy and due diligence firms in China, some of which refuse to audit in Xinjiang because of heightened difficulty of ascertaining reliable reports there, raises questions on how reliable the outcome will be, the Umbrella Organisation for Critical Shareholders said.
Show and tell?
To date, Volkswagen has been one of few corporations not taking pains to demonstrate its distance from the Uyghur forced labor system. It is, in fact, maintaining a physical presence in the Uyghur Region which is not even profitable.
While this impending audit both acknowledges a potential risk of Uyghur forced labor in their supply chain as well as a shift in public relations strategy, it is highly unlikely that the audit will be accurate. Further, it is yet to be seen who will be conducting the audit, what its scope is, and how transparent the company will be with the results.
The World Uyghur Congress is highly skeptical. “No worker can speak freely without putting himself and his family in danger. We have serious doubts about how Volkswagen intends to conduct an independent review.”
Keep the pressure going!
Volkswagen’s time in the hot seat is by no means over. The Berlin-based European Center for Constitutional and Human Rights has filed a lawsuit against the company, demanding evidence that it monitors its in-house as well as suppliers’ and sub-suppliers’ forced labor risks.
As pressure mounts on Volkswagen, advocacy groups like Freedom United continue to lead efforts to hold the company accountable.
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Despite the misgivings about exactly how the auditors will get full and honest information, it is really good news that the voice of the shareholders was powerful enough to force a rethink about just accepting the word of the ‘China chief’. The movement to inform and empower the shareholders has been so worthwhile. Thank you, and well done, to FREEDOM UNITED.
The truths about the force labour in China are indeed very well hidden and replaced by half truths