VW Chairman to Trim His Bonus Payment

Volkswagen AG Chairman Hans Dieter Poetsch has agreed to return a portion of the bonus he was to receive for taking the job last year, sources tell Bloomberg News.

The move aims to ease friction between VW management and labor over payouts to top executives as the company braces for the financial cost of remedying 11 million diesels it rigged to evade emission standards. Analysts say payments for regulatory fines fines and legal settlements will be several times greater than the €6.7 billion VW has budgeted to pay for recall-related repairs.

Poetsch was to receive an extra €10 million ($11.4 million) as compensation for giving up his job as VW’s chief financial officer to take the chairmanship last November.

Some executives at VW’s management board meeting last week objected to the idea of forfeiting their bonuses for 2015, according to Bloomberg. But its sources say the company’s supervisory board has agreed to review a plan that would reduce but not eliminate the bonuses. The proposal also would reveal board member compensation details as a part of VW’s 2015 financial results due April 28.

Critics say management dithering over bonuses signals a reluctance to accept responsibility for the diesel crisis and face the reality of the scandal’s threat. They say the same attitude reflects an autocratic flaw in the company’s culture, which they say is damaging the company’s reputation and dragging out VW’s still-unresolved diesel crisis in the U.S.