Hedge Fund

Activist Shareholder Targets VW Bonuses

VW CEO board and supervisory board members source Julian Stratenschulte dpa 58639068
VW's non-executive chairman Hans Dieter Pötsch, left, and CEO Matthias Müller, middle, will face shareholders on Wednesday.
  • Why it matters

    Why it matters

    TCI’s demands could force Volkswagen to change its corporate governance structure, giving minority shareholders more sway over Europe’s largest carmaker.

  • Facts

    Facts

    • Volkswagen admitted last September it had manipulated around 11 million diesel vehicles worldwide, plunging the firm into crisis.
    • The Porsche and Piëch families, descendants of carmaker Ferdinand Porsche, control Europe’s largest automaker through a holding.
    • Matthias Müller, VW’s CEO, and Hans Dieter Pötsch, the non-executive chairman, lead the carmaker and are seen as confidantes of the Porsche and Piëch families.
  • Audio

    Audio

  • Pdf

British hedge fund TCI, an activist investor led by one of Europe’s biggest boardroom reformers, Chris Hohn, is pressuring Volkswagen to scrap its executive bonus system and make other shareholder-friendly changes ahead of the automaker’s annual shareholders meeting in June.

In a letter, TCI, which holds a 2-percent stake in Volkswagen, said it was a “disgrace” that members of the automaker’s management and non-executive boards earned a combined €63 million, or $71.8 million, in 2015, when VW lost €1.6 billion and shareholders received just €68 million in dividends.

The letter, a copy of which was obtained by Handelsblatt, was addressed to members of the VW boards, including Chief Executive Matthias Müller and the supervisory board chairman, Hans Dieter Pötsch.

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