Private becomes public at VW

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Private becomes public at VW

The long-running power struggles at Volkswagen, Europe’s biggest carmaker, took a new twist on Monday after it emerged that the private life of the company’s controversial new personnel chief had been part of the reason his appointment was opposed unsuccessfully by key shareholders.

Horst Neumann, former personnel chief at Audi, was last Friday appointed to the VW job in a backroom deal struck by the powerful IG Metall engineering trade union and Ferdinand Piech, supervisory board chairman.

Many managers and shareholders opposed the deal because Neumann is a former IG Metall official, so there are at least a few small questions about his independence from the workers.

Now, it emerges that Neumann, 56, is also in a relationship with Andrea Nahles, 35, one of Germany’s best-known leftwing politicians.

Nahles proved her radical credentials this month by in effect ousting the chairman of her Social Democratic party in an internal party coup.

Top managers and conservative politicians close to VW suggest that this is the last thing VW needs – a union man who is big friends with a young leftie firebrand politician.

No lucky breaks for a company that was hoping to put this year’s sex and corruption scandal behind it.

Best left unsaid

British toffs are not having much luck with their memoirs these days. Just days after Sir Christopher Meyer caused a storm with his delightfully indiscreet reminiscences about his days as Britain’s ambassador in Washington, Prince Charles has landed in a bit of hot water over his account of the 1997 handover of Hong Kong to China.

Extracts of a private journal that was leaked to the press record royal sniffiness about “appalling old waxworks”, otherwise known as Chinese diplomats, and princely disdain for an “awful Soviet-style performance” of parading soldiers indulging in a “ridiculous rigmarole”.

The revelations have provoked a right royal fury, with Prince Charles’ office warning that legal action is being considered. The prince regularly writes accounts of his visits, which he then distributes among friends, relatives and contacts.

Unfortunately his Chinese account, “The Handover of Hong Kong – or The Great Chinese Takeaway” appears to have been distributed a little bit too far and ended up in the grubby hands of Fleet Street.

What the Chinese think of all this remains unknown. But, given the House of Windsor’s past form – Charles’ father Prince Philip famously once lapsed into insulting and tasteless jokes about the Chinese while on a royal visit there – their expectations of
British nobility were probably never that high.

Two masters

The unique challenge faced by Andy Lack, the former television news executive who runs Sony-BMG, could be neatly summarised by a social dilemma he was recently
left facing.

Lack had to choose between two dinner parties held on the same evening in New York.

One was to an event honouring his good friend and main supporter, Sir Howard Stringer, while the other was held to honour Gunter Thielen, the Bertelsmann chief.

Bravely, Lack opted to head downtown to the posh Cipriani event space to see Thielen receive a leadership award from the American Institute for Contemporary German Studies.

Thielen, of course, is trying to squeeze Lack out of the music group, a joint venture between Sony and Bertelsmann. Naturally, insiders were watching with great curiosity to see how the two would interact.

Asked in front of Thielen why he was not at Stringer’s event, he was overheard saying: “I have been to so many of Howard’s. I’d much rather be here.”

Having survived the cocktails, Lack moved on to the tougher task of dinner. He was seated with Australian Michael Smellie, who was so unhappy about Lack’s working style that he has announced plans to quit. Directly facing Lack was Rolf Schmidt-Holtz, Sony-BMG’s chairman, who would like to return to an executive role (ideally as Lack’s successor).

The only moment that might have given Lack comfort was during Thielen’s speech, in which the Bertelsmann chief emphasised that well-run companies “allow managers to make mistakes”.

Tough covenants

Socially responsible investing has been all the rage in recent years, and now Texan oil billionaire Sid Bass is getting in on the act.

His BBT fund has launched a hedge fund, Salient Partners, which will merge socially responsible investing and faith-based investing, two approaches that are usually distinct – if not contradictory.

The faith-based crowd tend to shun companies that profit from abortions, while the socially responsible outfits abhor guns, tobacco and alcohol makers.

Salient will refuse both, although according to its publicity, the fund appears to have a hierarchy of the activities it considers undesirable.

It will not invest at all in companies that have anything to do with abortions; or those that “derive significant revenues” from tobacco or gambling; or that “derive a majority of their revenues” from weaponry.

In clean sweep, the fund will avoid violators of human rights, violators of Roman Catholic teachings and violators of the environment.

Salient has already pulled in $100m, mostly from non-profits, and has capacity for another $200m.

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