Volkswagen’s recent audit of its plant in the Uyghur homeland, which the company claimed cleared it of allegations of forced labor, has been criticized for failing to meet international standards, according to a review of the leaked report.
In December, VW announced that an audit had found “no indications of forced labor” at its plant in the region, where human rights abuses against Uyghur Muslims have been widely documented. The audit was conducted in accordance with the SA8000 social auditing standard, a decision that led MSCI to remove its “red flag” on VW, allowing ESG-focused investors to once again purchase VW shares.
However, the Financial Times obtained the audit report, revealing that the Chinese law firm Guangdong Liangma Law, which worked with VW’s auditor Löning, did not follow key aspects of the SA8000 standard. Judy Gearhart, a professor at American University, noted that the audit “departs” from the standard in several significant ways, particularly in how interviews with workers were conducted. These interviews, live-streamed to the law firm’s office in Shenzhen, created an “intimidating” atmosphere and lacked the confidentiality required for an accurate assessment, rendering the results unreliable.
VW defended the audit, stating that the SA8000 standard was only used as a “basis” and that not all of its points were necessary. The company emphasized that it follows legal requirements in its communications and denied misleading the public.
Rushan Abbas, founder of Campaign for Uyghurs, who first received the leaked audit report, criticized VW, saying their actions were “an insult to millions of victims.” Uyghur human rights organizations, including the World Uyghur Congress, the Uyghur Human Rights Project, and Campaign for Uyghurs, have long called on VW to conduct a thorough investigation into potential involvement in Uyghur forced labor and to cease any operations that may contribute to these abuses.
Volkswagen’s plant in the Uyghur homeland, which is run in partnership with state-owned SAIC, has been under scrutiny over forced labor allegations for years. Although production at the plant has slowed since the pandemic, nearly a quarter of its 197 employees are Uyghur. VW has been hesitant to exit the region, fearing it would damage its relationship with its Chinese partner SAIC.
The audit, dated November 20, revealed that only managers were questioned about forced labor, while floor workers were asked limited, predetermined questions that did not directly address the issue. Additionally, China’s legal environment prevents workers from speaking freely about forced labor, as they risk severe penalties.
The flawed audit process also sparked internal dissent at Löning, with several employees resigning in protest. VW’s works council has since called for complete transparency from the company regarding the audit’s findings and the accountability of senior management.
Adrian Zenz, a researcher who helped expose China’s internment system in the Uyghur homeland, stated that VW’s claims about the audit were “misleading or false.” He also pointed out that the audit referenced activities promoting “ethnic harmony,” suggesting the plant may be assisting the Chinese state in its coercive ethnic policies.
Mr. Zenz also conducted an independent analysis of the investigation, titled An Assessment of the Audit of Volkswagen’s Controversial Factory in Xinjiang. His findings highlighted several issues, including that Liangma Law, the Shenzhen firm contracted for the audit and tied to the Chinese Communist Party, lacks any visible experience in conducting social audits and does not advertise such services. Clive Greenwood, who joined Liangma just before the audit, has publicly expressed that SA8000 audits are ineffective in the People’s Republic of China.
Additionally, auditors failed to ask general staff about forced labor. Interviews with Uyghur and other employees were monitored remotely via live video link, allowing state surveillance and compromising the anonymity of the interviewees. In short, SA8000 guidelines for worker interviews were significantly violated.
The continued criticism of VW’s audit, combined with the ongoing pressure from Uyghur rights groups, underscores the importance of transparency and thorough investigation into any involvement in forced labor. The question remains whether VW will fully address these allegations and take action to ensure it is not complicit in the abuses faced by the Uyghur people.