One of Volkswagen’s biggest shareholders did not initially want to support the automaker’s top management actions for 2015, but eventually took a softer line in order to avoid altering the brand’s image even more.
The German state of Lower Saxony, the second biggest shareholder in Volkswagen AG by voting rights with a 20 percent stake, has been loud and harsh towards the automaker since the beginning of the emissions scandal. Shareholders backing up the top management’s actions for the previous financial year is a common and formal practice for German companies, but sources told Reuters the federal state initially refused to show its support at a recent debate over the matter at a supervisory board meeting. It appears to have been the right stance to take, considering the fact that 2015 brought Volkswagen its biggest ever operating loss. However, Lower Saxony, which holds two seats on the 20-member supervisory board, backed then up in the end, as it considered that such a public negative vote would harm the company even further. “It would have been read as a vote of no confidence in the leadership,” said the source. “It’s in Lower Saxony’s best interest that VW gets moving again.”
Therefore, the supervisory board finally recommended after its meeting that shareholders should vote to ratify the actions of the top management at the annual general meeting on June 22. Volkswagen said that preliminary results of the ongoing investigation over emissions cheating scandal have shown “no serious and manifest breaches of duty on the part of any serving or former members of the Board of Management.”