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MMFs are Turning Green: ESG Innovation at DWS

DWS is already known as a world-class asset manager of money market funds (MMFs). Now, the firm is leading the way in bringing environmental, social and governance (ESG) criteria into money market strategies – making it a worthy winner of TMI’s 2019 Award for Best MMF Innovation. Dr Asoka Woehrmann, CEO and Chairman of the Executive Board, DWS Group, and Reyer Kooy, Head of Institutional Liquidity Management EMEA & Asia, DWS, explain why ESG is such an important focus for DWS and how corporate treasurers can benefit from the firm’s expertise in this area.

Assets in environmental, social and governance (ESG) money market funds (MMFs) grew by 15% in first half of 2019[1]. These funds are predicted to become more popular[2] as corporates increasingly look for sustainable investment vehicles in which to park their excess cash. 

“Although ESG is the zeitgeist, it would be a mistake to think that it is a fad that will disappear,” says Kooy. “It would also be wrong to assume that asset managers are jumping on the bandwagon with their ESG offerings. DWS has long recognised the importance of ESG for investors and was among the first signatories of the United Nations-backed Principles for Responsible Investment [PRI] in 2008,” he notes.

Integrated and innovative ESG

Woehrmann agrees: “We have been providing responsible investment strategies for more than 20 years. Now we want to make ESG the core of everything we do.” As such, ESG lies at the heart of DWS’ strategy – for today and tomorrow. “We want to continue to develop and establish innovative ESG products in the future, because here at DWS sustainability is not just a passing trend, but rather a question of long-term, responsible conduct. For us it is a central guiding principle and also gives us the opportunity to distinguish ourselves from the competition,” says Woehrmann.