DWS has denied reports that the €25m fine it received earlier this year as part of a greenwashing investigation is linked to specific investment products, including its €20bn flagship fund, Top Dividende.
The German asset manager issued a response following allegations published by public broadcasters WDR and NDR, and Süddeutsche Zeitung, that the Frankfurt public prosecutor’s office cited Top Dividende and the DWS ESG Blue Economy fund as part of its case.
A DWS spokesperson told IPE that the penalty, announced in April, “concerns a standard that relates to the organisation, and not individual products.” The spokesperson added that the fine stemmed from shortcomings in DWS’s internal resources and procedures required for proper business operations.
The public prosecutor’s office stated at the time that DWS had “intensively promoted products” with ESG characteristics between mid-2020 and January 2023.
According to media reports, a law firm hired by DWS warned the manager as early as February 2023 not to suggest the Blue Economy fund – developed in partnership with environmental group WWF – directly achieved specific marine conservation goals. WWF has since ended its collaboration with DWS and said it had no knowledge of any connection between the fund and the financial penalty.
The Frankfurt prosecutor declined to comment on whether the fine was explicitly targeting the Top Dividende or the Blue Economy funds.
Meanwhile, DWS is reviewing its sustainability strategy in light of shifting regulatory conditions and client demand.
Speaking at the firm’s annual general meeting last week, chief executive officer Stefan Hoops said the revised approach reflects growing legal risks for investee companies in the US, stemming from evolving climate policies and regulation.
“The climate policy and regulatory requirements of the US administration increasingly entail legal implications and risks for the companies in which we invest,” Hoops told shareholders.
He said DWS will continue to enhance its sustainability-related investment processes and adapt to the “dynamic” political and regulatory environment, offering a broad suite of strategies – both those promoting sustainability and those focused on conventional investment goals.
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