The headline says "execs" but I don't see any Board members getting prison terms. Martin Winterkorn, the CEO, has basically escaped prosecution altogether.
Can a board member be reasonably responsible for the actions of tens of thousands of employees if they have not explicitly enabled or condoned criminal behaviour?
The person that would benefit the most would be a senior executive who stands to gain a promotion, bonus or land an even better job elsewhere.
A former prime minister of my country was fined over $6 million for being on the board of a company what traded while insolvent. Not a prison sentence but a harsh penalty for someone that was not super rich (as far as I am aware).
It is extremely rare to see that kind of prosecution in western countries (US or EU).
Hell even if not on purpose. The point of a board is oversight. If management can commit illegal acts without the board's knowledge, the board has failed. Of course incompetence in a board role shouldn't lead to prison. But it should at least bar someone from future board jobs for a few years.
Not sure what the answer is, but if the answer is yes, then that incentivizes them to build the oversight and reporting capabilities to be able to steer away from crime, and to hire noncriminal subordinates &c.
One way this could look in practice is board members having to post a large bond that gets taken away if the commpany is found to commit crimes during their tenure.
Anecdotically, the Real Madrid requires a large bond (57M) posted by the president. http://news.bbc.co.uk/sport1/hi/football/europe/8076515.stm
The head of development, a board member, got a suspended sentence.
>Martin Winterkorn, the CEO, has basically escaped prosecution altogether.
How so?
Winterkorn has spent the past decade getting various postponements in his trial. Now that he is approaching 80 it is unlikely he will suffer any serious punishment.
[1] https://www.justice.gov/archives/opa/pr/former-ceo-volkswage...