Volkswagen reinstates lobbyist, exonerating him over diesel fume tests

WOLFSBURG, Germany (Reuters) - Volkswagen said it has reinstated its former chief lobbyist after an internal investigation into his role in tests that exposed monkeys and humans to toxic diesel fumes found no evidence of wrongdoing.

In January Europe's largest automaker had suspended Thomas Steg, a former German government spokesman who took charge of external relations at Volkswagen in 2012, pending the investigation.

"Volkswagen management, as well as I personally, believe that it is part of good corporate culture that employees must be fully rehabilitated after being exonerated," VW's head of integrity and legal affairs, Hiltrud Werner, told reporters on Wednesday at the carmaker's base in Wolfsburg.

The company is continuing a broader investigation into all of its research projects.

A source at VW had said in January that 58-year-old Steg, as head of sustainability topics at the VW group, was not only in charge of the unit that had commissioned the tests but also had prior knowledge of the monkey experiments and had made no effort to stop them.

"I was neither responsible for the planning, the authorization or the commissioning of this study," Steg told a press briefing on Wednesday. "The study was unnecessary and of no scientific use, it should have never happened."

The project was funded by VW and German peers Daimler and BMW who sought to prove that diesel cars posed less of a threat to human health than groups including the World Health Organization have claimed, an auto-industry source has said.

After Steg was relieved of his duties, Daimler and BMW also suspended or moved employees linked to the group that had commissioned the tests, the European Research Group on Environment and Health in the Transport Sector (EUGT), which was funded by the three carmakers.

"You can rest assured: We will continue our investigation of all experimental and research projects in which the company was or is involved, directly or indirectly, and will complete it in the second half of the year," Werner said.

The New York Times first reported the experiments, which it said were conducted in 2014, a year before VW was found cheating U.S. diesel emissions tests, which sparked the biggest business crisis in its history.

VW has since pledged sweeping steps to ensure that a scandal such as "Dieselgate" will never happen again. A lot of the changes will be overseen by Werner, a former head of group auditing at VW.

Wednesday's announcement to bring back Steg comes as VW, under new Chief Executive Herbert Diess, seeks to accelerate its post-Dieselgate transformation and shift focus back to its operating business, especially its push to embrace electric cars and new mobility services.

(Reporting by Andreas Cremer; Editing by Susan Fenton)