The share price of Deutsche Bank’s asset management arm, DWS Group, sank by more than 10% when markets opened following the news that US authorities are investigating it over sustainability claims.
The Group’s share price dropped from €38.96 at 8:03 AM BST to €36.94 by 8:40 AM BST, according to MarketWatch.
The probe was launched after the firm’s ex-head of sustainability said DWS Group overstated how much it used sustainable investing criteria to manage its assets, according to The Wall Street Journal, which first broke the news, citing people familiar with the matter.
Environmental, social and governance-related investment products — or ESG for short — have seen a boom in interest during the pandemic, both from retail and institutional investors.
A DWS spokesman told the Journal that the firm doesn’t comment on questions related to litigation or regulatory matters. A spokesman for Deutsche Bank declined to comment, the Journal reported.
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