Because of greenwashing: DWS sued by consumer advice center

Because of greenwashing: DWS sued by consumer advice center

According to a report from www.tagesschau.de, the Baden-Württemberg consumer advice center has sued Germany's largest fund company DWS on suspicion of greenwashing. Consumer advocates accuse the company of misleading advertising. DWS denies these allegations and emphasizes that it takes great care when creating its advertising materials.

Greenwashing is a widespread problem in the financial industry. Products and services are often promoted as sustainable even though they offer no actual environmental or social benefits. This leads to misleading consumers and a lack of transparency.

In this specific case, it is about DWS’ advertising for its ESG Climate Tech fund. This fund is advertised as environmentally friendly, but also invests in companies from controversial sectors such as the coal industry. The consumer advice center criticizes the fact that DWS does not transparently explain how it arrived at its information. DWS also emphasizes that investors can make a targeted contribution to achieving climate goals with their investments, which, according to consumer advocates, is not the case.

The impact of this lawsuit could be significant on both the market and consumers. If suspicions of greenwashing are confirmed, this could undermine investors' confidence in DWS and lead to an outflow of funds. In addition, consumers could become more cautious and pay more attention to transparent and credible sustainability criteria in their investment decisions.

It remains to be seen how the courts will decide in this case. If it turns out that DWS actually used misleading advertising, this could send a signal to the entire financial industry. It could lead to stricter regulations being introduced to combat greenwashing and increase transparency for consumers.

Source: According to a report from www.tagesschau.de