VW could pay the damages in its particular case without dissolution. What would you do with the extra money after liquidating its assets? It seems like you're simply arguing for even bigger fines.
If the company can pay for fines, fine. No need to dissolve them, but the leadership responsible still needs to face a judge. Just because you're part of a corporation, shouldn't mean you get to walk from crimes.
There’s your problem, assuming that there is a way for leadership in a company not be responsible. Managers being ‘responsible’ is the only argument for them being paid disproportionally more than the average worker. In turn, a manager should always be responsible for the actions of their underlings all the way to the top, regardless of personal involvement in or knowledge of those actions.
The idea that the management of a company could not be responsible for something done by that company (which, e.g. could have resulted in considerable savings for the company and its shareholders) is simply ludicrous.
You could argue that they should have a seperate control instance, but that was what they had, and they cheated it anyway.
Morally, certainly yes, that’s why they’re the CEO. Their only defence against responsibility is incapacity to fulfil their duties, in which case they should resign immediately.
This isn't just a theory. On of my companies competitors (I do not know which, I was just given it as an example) was caught bribing officials in China. After investigation it was decided that it was a rouge manager and not the CEO: they has a policy of not bribing, everyone was trained in recognizing how something (even a meal) could be seen as a bribe, and when other unethical action had been taken in the past the company took action to stop it and treated the whistle-blowers well. The CEO got off because he did everything in his power to ensure this wouldn't happen.
That's a good start on fines. Now make them reimburse 590K owners. Let's see... A Jetta has an MSRP of >$20K. So, how about reimbursing $5K-$10K of every diesel vehicle that was fraudulently sold? Or, force VW to buy them all back at original MSRP. Then they could resell them for whatever they could get for them.
Would you pay $10K for a 2 year old cheater Jetta?
Edit: removed typo