Prosecutors have fined German asset manager DWS 25 million euros ($27 million) after finding the firm guilty of "greenwashing," or making misleading statements about its environmental and social investing credentials.
Deutsche Bank-owned DWS had publicly claimed that it was a "leader" in environmental, social and governance (ESG) investing, and that ESG was an integral part of its DNA.
But these statements "did not correspond to reality," the Frankfurt state prosecutor's office said in a statement on Wednesday.
The fine for breaches of German financial investment laws comes after DWS agreed in 2023 to pay $25 million in the United States to settle to charges over misstatements linked to ESG investing, and for failures in policies designed to prevent money laundering.
DWS said on Wednesday that it accepted the latest fine, and that it would not affect its first-quarter results as it had already made provisions.
"In recent years, we have already publicly acknowledged that...our marketing was sometimes exuberant. We have already improved our internal documentation and control processes, and we continue to do so," DWS said.
In 2021, regulators on both sides of the Atlantic began investigating accusations, sparked by a whistleblower, that DWS may have misled investors by marketing its funds as greener than they actually were.
Its CEO at the time, Asoka Woehrmann, who has called the allegations relating to his time in office "unfounded," later resigned after German prosecutors raided DWS and Deutsche Bank offices in Frankfurt.
Regulators globally have sought to clamp down on greenwashing by companies in order to improve transparency about the sustainability of investments.
($1 = 0.9261 euros)
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