Industry Updates

DWS faces legal action over greenwashing ad campaigns

Claims the German asset manager ran misleading ESG adverts

Theo Andrew

a statue of a person holding a purse

A German consumer group is suing DWS for allegedly using misleading sustainability claims in its advertising.

The consumer advice service, Verbraucherzentrale Baden-Württemberg (VBW), said it launched the legal action following a series of adverts for the asset manager’s DWS Invest ESG Climate Tech Fond, claiming they were potentially misleading to consumers.

The claim comes less than six months after former CEO of DWS Asoka Woehrmann stepped down after police raided its offices amid allegations of greenwashing, as the German asset manager continues to be beset by claims of misleading investors about their sustainable practices.

The lawsuit relates to an advert published in May, in which DWS claimed the fund invests 0% of its assets into controversial sectors including “coal” and “armament goods”.

VBW, a not-for-profit consumer group, claims this is misleading as the firm does “not explain transparently” how it obtained the data.

"Investors are led to believe that they invest 0% in coal, while the companies held in the fund are allowed to generate up to 14.99% sales in the coal industry," Niels Nauhauser, head of the departments for old-age provision, banks and loans at VBW said.

Furthermore, the advert claims to generate 90% less carbon dioxide than its reference index, the MSCI AC World index, however, the consumer group said it does not explain how it calculates this effect, noting that the reference index uses ESG data which relies on the self-disclosure of companies “which cannot be verified”.

In a separate advert, DWS claims the climate tech fund invests “in a targeted manner in achieving climate goals” and that they would “help counteract climate change through targeted investments”.

However, Nauhauser called the lack of transparency “unacceptable” and noted the European Union’s taxonomy requires transparent information for ESG-related advertising.

DWS rejected the claims and said it will continue to regularly review its marketing materials.

A spokesperson said: “DWS rejects the criticism from the consumer organisation VBW. DWS takes great care in the production of advertising materials.

“We have thoroughly examined the documents in focus and remain convinced that DWS’s advertising materials criticised by the consumer organisation comply with legal requirements.

“Also, in relation to the dynamically developing area of ESG, it is our aspiration to present our products in a transparent and comprehensible manner. We will continue to regularly review and further develop our advertising materials.”

DWS has continued to build out its sustainable range of ETFs over the past few months, most recently switching the underlying indices on two corporate bond ESG ETFs to ones incorporating Paris-aligned benchmark (PAB) criteria.

In August, new DWS CEO Stefan Hoops took to LinkedIn to criticise media coverage of greenwashing allegations levelled against its asset management business.

The legal claim comes amid a wave of greenwashing probes in the UK by the Advertising Standards Authority, which banned HSBC sustainability-focused adverts earlier this month.

Related articles


No ETFs to show.