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Volkswagen shareholders elected the wife of Ferdinand Piëch to the German carmaker’s supervisory board late on Thursday as the automotive patriarch shrugged off complaints about poor corporate governance in order to secure his legacy.
Ursula Piëch, a former kindergarten teacher, gains a seat on VW’s 20-person board and a say in every big strategic decision taken at Europe’s biggest carmaker by sales. Mr Piëch, grandson of the creator of the VW Beetle, also won shareholder approval for another five years as chairman.
Several fund managers and shareholder advisory services had criticised the nomination this week because of Mrs Piëch’s perceived lack of qualifications and because of a dwindling number of independent representatives on the board.
However, ordinary shareholders who spoke at the meeting were mostly sanguine about the appointment and commended her many years of close association with VW.
Moreover, the election was never in doubt as Porsche-Piëch family members, the State of Lower of Saxony and Qatar together hold a large majority of the shares and had previously indicated their support.
A nervous Mrs Piëch told shareholders that as joint custodian of her husband’s VW shareholdings she well understood the mindset of investors.
“As a member of the supervisory board I would like to contribute to strengthening the success of the company and to represent the interests of shareholders large and small, in a socially responsible manner.
“She’ll certainly do [the job] better than me,” Mr Piëch, told journalists. VW’s chairman also rejected criticism of the €16.6m annual pay and bonuses awarded to Martin Winterkorn, VW’s chief executive.
Corporate governance experts had expressed concerns about the size of the payout and the unclear details of the bonus scheme that triggered it.
But Mr Piëch argued that Germany’s tax authorities would receive about 50 per cent of the pay award and that compared with US car industry executives, Mr Winterkorn was good value.
Volkswagen sold 8.3m vehicles last year and revenues jumped by 26 per cent to a record €159bn. On Wednesday VW’s Audi brand announced the acquisition of Ducati, the premium motorcycle maker, handing Mr Piëch, who turned 75 on Tuesday, a much-treasured birthday present.
Mr Winterkorn cautioned that 2012 would be a “very demanding year for us” and warned that “the risks are growing”. Still, he reiterated that VW expects to this year sell more vehicles than in 2011 and would aim to achieve a similar level of operating profit as last year.