In September 2015 US regulators found Volkswagen guilty of intentionally falsifying emissions data. It catalyzed much debate on VW, the car manufacturing industry and test standards in Europe to limit air polluting NOx emissions. While consumer reaction worldwide did not immediately show a dramatic impact on sales revenues, investors made their displeasure clear. VW shares fell 70% over the following month. The company was removed from the Dow Jones Sustainability Indices (DJSI) by October and the FTSE4Good Index by December. In mid-November Union Investment, Germany’s third largest asset manager, called for the company to replace its new CEO and chairman. Volkswagen has budgeted $7.3 billion to mitigate fallout, including the prospect of vehicle buybacks. Commentators noted how an environmental or “extra-financial” issue became material overnight. (On broader industry fallout see FT.)
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