PwC advised DWS on sustainability while investigating greenwashing claims

PwC was advising DWS on sustainability concurrently the accounting company was investigating and dismissing whistleblower allegations of large-scale greenwashing on the asset supervisor, elevating questions over the independence of the probe.

The allegations had been made in mid-March by DWS’ former head of sustainability Desiree Fixler. Shortly after being sacked, she accused DWS of misrepresenting the way in which it used environmental, social and governance metrics to analyse corporations all through its funding platform.

Fixler outlined her issues in a five-page file, seen by the Financial Events, she emailed to DWS chair Karl von Rohr on March 17.

After the allegations had been reported by the Wall Highway Journal remaining month, US and German regulators launched investigations, sending the asset supervisor’s share value sharply down.

Christian Stitching, CEO of Deutsche Monetary establishment, DWS’ largest shareholder, suggested analysts on Friday the discussions about alleged greenwashing had been mere “noises”. He moreover highlighted the need to be “very cautious and actually disciplined and actually diligent in your [ESG] processes, in your reporting, in your measurement and likewise in deciding is it ESG conform or is it not?”

DWS denies all wrongdoing and mandated PwC to analysis the allegations days after the company acquired the file.

In a video identify on March 23, key DWS supervisory board members agreed to “take [all of Fixler’s allegations] critically and appropriately assess [them]”, in response to a doc seen by the FT. They tasked Martin Weirich, a consulting confederate at PwC, with assessing the claims in a “actuality discovering prepare” code-named ‘Gamma’.

On the similar time, a definite PwC crew led by confederate Nicole Röttmer was advising the asset supervisor on simple strategies to satisfy its goal of net zero emissions by at least 2050.

DWS paid about €300,000 for PwC’s net-zero consulting, which has been concluded, in response to of us with direct knowledge of the matter. The asset supervisor was moreover in talks with PwC in early 2021 to license sustainability devices costing about €50,000 a yr, which they lastly decided in opposition to, one in every of many people talked about.

All through enterprise “Gamma”, the Large 4 company interviewed seven senior DWS employees and examined emails and shows that Fixler had talked about.

Relating to primarily probably the most contentious scenario — that the quantity of property which have gone by the use of a so-called ESG integration course of was overstated throughout the annual report — PwC reviewed working papers of DWS’ auditor KPMG.

PwC found that the ESG classification was primarily based totally on a correct course of, and that the numbers had been challenged by KPMG all through the annual audit, of us accustomed to the probe talked about. “The amount that was reported throughout the annual report was smaller than throughout the preliminary inside one,” talked about one explicit particular person.

In mid-May, PwC talked about in a 42-page report, that it “couldn’t decide substance all through the allegations”. PwC moreover dismissed Fixler’s declare that she was fired in retaliation for elevating issues internally.

Fixler suggested the FT she “wish to understand how PwC managed the potential battle of curiosity between its enterprise ESG engagement and the audit within the similar house” and recognized that she was not contacted at any degree all through the investigation.

In an authorities summary of the investigation, PwC on May 21 acknowledged that “no further data assortment (eg by the use of outreach to Ms Fixler) is important at this degree”, arguing the “context and data related to her allegations may very well be established in our view by on the market data objects equipped by DWS”.

Nonetheless, Fixler talked about PwC must have contacted her about totally different issues that had been in her e mail to the DWS chair, nevertheless not in her further detailed file, along with what she considered to be “lax” anti-financial crime controls.

One explicit particular person close to a European financial regulator, talked about that although it was “attention-grabbing” that PwC didn’t contact Fixler, the investigation itself had been “thorough” and had not been undermined by the company’s advisory mandate.

Every of the two PwC companions declined to comment. PwC moreover declined to the touch upon its completely totally different DWS mandates, citing shopper confidentiality nevertheless talked about that “you have to to bear in mind that the fears you insinuate referring to our independence or conflicts of curiosity are unfounded”.

DWS talked about that it “stands by its disclosures in its annual evaluations. DWS firmly rejects the unfounded allegations being made by a former employee.” material materials/7ec500fd-ab97-4af6-ac6d-9da8dbad50ca | PwC prompt DWS on sustainability whereas investigating greenwashing claims

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