Annual Report

Corporate Social Responsibility
and Sustainability

At Volkswagen, corporate social responsibility (CSR) is seen as our Company making a significant contribution towards sustainable development. We pursue environmental, economic and social objectives in equal measure. Under our vision of sustainability, our business practices and depletion of resources must not compromise the ability of future generations to meet their own needs. This belief is in line with international efforts to create a sustainable economic system.

Sustainability is the backbone of Volkswagen’s corporate policy, which is why we design the entire value creation process to be sustainable. Through corporate responsibility that is committed to the vision of sustainability, we safeguard the Company’s long-term future. In order to make an effective contribution to sustainable mobility, Volkswagen as a company with global responsibility is working hard to develop technologies for the cleanest, most fuel-efficient vehicles, reconciling job security and profitability in the process.

Consistently intertwining the core economic processes with ecological and social issues is an integral part of our corporate policy. CSR involves voluntarily taking social responsibility at a level beyond mere compliance with the legal requirements. The Volkswagen Group’s integrated CSR concept is aimed at avoiding risks, identifying opportunities for development early on and improving the Group’s reputation. Ultimately, CSR will be instrumental in helping to increase the value of the Company and safeguard it in the long term.

As a good corporate citizen, Volkswagen has always considered social involvement part of its entrepreneurial activities. We support social development, culture and education at all Group locations worldwide and set up projects for the development of regional infrastructure, health promotion, sport and nature conservation.

CSR Coordination and Sustainability office

Since 2006, all activities in the field of CSR and sustainability in the Volkswagen Group have been coordinated by the CSR office, whose task is to strategically align CSR activities and optimize sustainability management. This office reports to the CSR & Sustainability steering group, which includes all central Group departments and the Group Works Council. The objective of the work in the steering group is to network the internal units and improve exchange processes between the line departments. Our interdisciplinary CSR project team handles current topics; since a Group-wide CSR committee was formed in 2009, there has been regular interaction with the CSR coordinators of the brands and regions.

Last year, we successfully completed Phase I of the introduction of the IT-based CSR KPI system. This system enables us to organize the management of our CSR activities more efficiently and increase their transparency and success, thus creating a fundamental basis for timely CSR and sustainability reporting in the Group. In Phase II, the KPI system will be implemented in the various brands and regions, enabling Volkswagen to meet the increasing demands of its stakeholders for an up-to-date, differentiated presentation of the Company’s CSR and sustainability performance.

The Volkswagen Group contributes its technological and social expertise in national, European and worldwide corporate networks, which allows it to support the many projects initiated there on a long-term basis. One of our principal tasks in these networks is preparing information on environmental and social standards for suppliers. The online portal of CSR Europe, the leading European business network for corporate social responsibility, provides an important, internationally accepted communication platform for this. We are also involved in econsense, the sustainable development forum of Deutsche Wirtschaft e.V.

as percent
Results of the SAM 2010 assessment (graphics)

Volkswagen in sustainability rankings and indices

The recommendations and decisions of financial market participants are not based solely on economic indicators, but increasingly also on information that the companies provide about their sustainability profiles. Analysts and investors now regard extensive involvement in the interests of sustainability as an indicator for forward-looking corporate governance. Sustainability ratings are an extremely useful tool for illustrating a company’s performance in the environmental, social and economic dimensions. But high rankings in sustainability ratings and indices do not only send important signals to stakeholders; they also increase motivation in the Company. In 2010, Volkswagen was again able to maintain its position among the leaders in its sector in the most important international ratings and indices.

As in the previous year, the Company is listed on the Dow Jones Sustainability World Index. Volkswagen scored top marks in particular in the assessment of environmental management, sustainability reporting, employment growth and social commitment by the Swiss asset management company SAM on behalf of Dow Jones.

How Volkswagen fared in 2010 compared with the industry average can be seen in the chart above.

Volkswagen was listed on the following sustainability indices at the reporting date: ASPI (Advanced Sustainability Performance Indices), Dow Jones Sustainability Europe Index, Dow Jones Sustainability World Index, ECPI Ethical Index Europe, ECPI Ethical Index EMU, ECPI Ethical Index Global, Ethibel Sustainability Index, FTSE4Good and FTSE4Good Environmental Leaders Europe 40.

Global Compact

Since 2002, Volkswagen has been involved in the Global Compact (GC) initiated by former UN Secretary General Kofi Annan. Encompassing over 7,000 companies from more than 135 countries, the Global Compact is the world’s largest and most important CSR alliance and works in support of a more sustainable and more inclusive global economy. Volkswagen’s participation helps realize this goal.

The GC is based on ten principles in the areas of human rights, labor standards, environmental protection and the fight against corruption. Volkswagen continued to focus its business activities at all its plants on these principles in 2010. We provide our expertise in the GC to enable other companies to act in a globally responsible manner as well. The progress Volkswagen makes on the basis of its active participation in the GC is documented in an annual report. Two examples: Volkswagen is involved in the “Sustainable Supplier Chain” GC project, the results of which were compiled in a manual and presented at the GC summit in New York in June 2010. The project implemented by Volkswagen de México to promote sustainable water use in the Izta-Popo mountain region in Mexico was also reported in the international GC yearbook. In addition, we presented this project at the Convention on Biological Diversity in Nagoya, Japan, in September 2010.

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