Asset managers fear exaggerated claims over sustainability-focused investments could become a mis-selling scandal across the industry after regulators on both sides of the Atlantic sharpened their focus on environmental, social and governance investing at Germany’s DWS.
Investigations by regulators in Germany and the US, triggered by allegations made by DWS’s former global head of sustainability, have put greenwashing — unjustified claims about environmental practices — centre stage for Europe’s investment industry.
Rival fund houses now fear they also could come under scrutiny over claims of sustainability, which is hard to measure and varies greatly from one fund to the next.
“The definition of what ESG or responsible investment truly is has been up for debate ever since it was created,” said Sébastien Thevoux-Chabuel, a portfolio manager at Comgest. “[What] has happened to DWS could happen to almost any investor.”
Desiree Fixler, who was sacked earlier this year from her role as global head of sustainability at DWS, has alleged the German asset manager made misleading statements in its 2020 annual report, where it claimed more than half of its $900bn in assets were invested using ESG criteria.
The original full article can be found at ft.com