Frankfurt The German financial regulator Bafin has contacted Deutsche Bank in connection with the allegations against the fund subsidiary DWS. The request is about the role of the bank’s deputy chief executive, Karl von Rohr, who is also chairman of the DWS supervisory board, according to financial circles. Neither DWS nor Deutsche Bank wanted to comment on this.
The DWS has had to defend itself against the charge of “greenwashing” for several weeks. A former employee, from whom DWS has separated, accuses the fund company of systematically presenting its sustainability commitment too positively.
According to financial circles, the former head of the sustainability department of the fund company, Desiree Fixler, sent a list of allegations to von Rohr shortly after her dismissal, saying that it was not only about criticism of sustainability reporting, but also about a number of other labor law aspects.
According to the information, von Rohr was involved in the examination of the dismissal, and he also signed the annual report, which is now being examined for allegedly embellished sustainability information.
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According to information from the Handelsblatt, the DWS supervisory board commissioned the auditing company PwC to investigate Fixler’s allegations.
Internal investigation by PwC
“We could not identify any substance in the allegations made by Ms. Fixler, namely greenwashing, deceiving investors or systematic discrimination during the hiring phase of Ms. Fixler,” quoted the Bloomberg news agency from the PwC report. Bloomberg first reported on Bafin’s request to Deutsche Bank.
According to information from the Handelsblatt, the PwC report does not cover all the allegations made by Fixler because the former employee has since expanded her criticism again.
The Bafin and the US authorities, including the securities regulator SEC, are scrutinizing all allegations against DWS, which the ex-sustainability boss has made.
The DWS affair has alarmed the entire fund industry. Asset managers across Europe are currently reviewing their portfolios and sustainability reporting to ensure they are not prone to similar allegations.
The EU is currently working on a so-called taxinomy, which should lay down precise rules as to which investments are considered sustainable and which are not. In the USA the SEC has been working on new regulatory provisions for the area of sustainability for a long time. Authorities chief Gary Gensler could oblige fund managers to disclose which criteria they use for sustainability funds and which data they use.
The discussions on the subject of “greenwashing” are a setback for DWS boss Asoka Wöhrmann, but also for Christian Sewing, the CEO of Deutsche Bank. “ESG, ie banking based on strict environmental, social and management criteria, is, in my opinion, the biggest growth topic in decades,” Sewing said a few days ago at the Handelsblatt’s banking summit. In his opinion, sustainability will determine winners and losers in the banking industry. Deutsche Bank aims to achieve around 200 billion euros in sustainable financing and investments by the end of 2023.
More: The long road to greener finances