Mercedes: Manager Brüngger’s contract extension

Mercedes Legal Director Renata Jungo Brüngger

The CEO’s contract is to be extended.

(Photo: Mercedes)

Vienna Mercedes Legal Director Renata Jungo Brüngger likes to emphasize that corporations that are unable to implement a sustainable business strategy would soon lose their business basis. The Swiss works according to the simple maxim “Sustainable business or out of business”.

Although the manager won’t win a popularity contest among horsepower junkies, it does gain respect from colleagues, suppliers and her own board of directors. The Swiss apparently considers the latter to be indispensable. In any case, the 20-strong Mercedes control board wants to extend Jungo Brüngger’s contract, which expires in December, again, the Handelsblatt learned from corporate circles.

The extension is to be decided at the next Supervisory Board meeting in February. A three-year contract would be normal. Another contract term is also conceivable, according to internal sources. Mercedes explained: “Contract extensions for board members are a matter for the supervisory board. We will therefore not comment on it.”

Clear mandate in the diesel scandal

The car manufacturer’s inspectors around the chairman of the supervisory board, Bernd Pischetsrieder, value Jungo Brüngger as a pragmatic crisis manager. The enthusiastic mountain hiker joined Mercedes in 2001 as Head of Legal. The trained lawyer has been on the board since 2016. In the diesel scandal in particular, the 61-year-old saved the Dax group a lot of trouble, according to Stuttgart.

The starting position was difficult. Shortly after the million-fold fraud with illegal exhaust gas technology was exposed at Volkswagen in autumn 2015, the then Mercedes boss Dieter Zetsche categorically ruled out similar processes at the Swabians. “We don’t cheat, we didn’t manipulate any exhaust gas values,” explained Zetsche. Over time, the manager became meek.

Several mass recalls also followed at Mercedes. Prosecutors swarmed out in Germany. The US judicial authorities investigated, and customers complained thousands of times. The supervisory boards of the car manufacturer became nervous and gave chief lawyer Jungo Brüngger a clear mandate. She should draw a line under the misery – as quickly and quietly as possible.

trust in the board of directors

Mercedes boss Ola Källenius is satisfied with how legal director Renata Jungo Brüngger handled the diesel scandal.

(Photo: Mercedes)

Jungo Brüngger got to work and decided on a tactic that seems quite paradoxical: On the one hand, she assured the authorities and prosecutors of her full cooperation. Mercedes accepted a fine of 870 million euros from the Stuttgart public prosecutor’s office without a murmur.

The Swabians also reached an out-of-court settlement with American customs and border protection and various US environmental authorities. The comparison cost almost 1.3 billion euros. In addition, more than 590 million euros were due for the settlement of a class action lawsuit in the USA; for an amicable settlement in a similar lawsuit in Canada, another 175 million euros were added.

More than 30,000 customer complaints

On the other hand, Jungo Brüngger and her team are vehemently defending Mercedes exhaust technology in civil proceedings in Germany. More than 30,000 customer lawsuits have been dismissed by the regional courts so far. In about 1,300 cases, consumers were right. The balance sheet at the higher regional courts is similarly favorable for Mercedes. Highest-instance judgments are still pending.

In total, Mercedes had to spend a mid-single-digit billion amount for proceedings and comparisons in the diesel scandal. Compared to the more than 30 billion euros that VW had to pay in recent years, this is a rather small amount. In contrast to Lower Saxony, Mercedes has never admitted guilt. No acting or former manager of the Swabians had to be in the dock. Mercedes was also spared an external watchdog.

In other legal disputes, the brand with the star went completely unpunished. The group successfully applied for leniency in the EU antitrust proceedings on illegal agreements on SCR catalytic converters and particle filters. Influential colleagues praised Jungo Brüngger for giving Mercedes a high degree of legal certainty and getting the company out of the negative headlines.

The Swiss also revised the entire compliance system at Mercedes to prevent another emissions disaster. When it comes to critical issues at the interface between technology, law and ethics, the car manufacturer’s engineers are now supported by experienced lawyers in interdisciplinary teams. Some developers speak of “inquisitorial approaches”; but most have come to terms with it.

More: Michael Schiebe becomes the new AMG boss.

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