One of the top legal firms advising asset managers on ESG says the industry needs to brace for a more rigorous enforcement of regulations, effective immediately.
There’s “a reckoning” under way, said Sonali Siriwardena, partner and global head of ESG at law firm Simmons & Simmons in London. Despite pushing through a “tsunami” of ESG rules, it’s now apparent that “regulators aren’t necessarily looking at a grace period” to allow the industry to adapt, she said.
The comments come as ESG fund managers digest the crackdown that just hit their industry. On May 31, as police searched the offices of Deutsche Bank AG and its fund unit DWS Group, the authorities who sent them were setting a precedent for environmental, social and governance investing. The allegations of greenwashing that triggered the raid have been rejected by DWS, but nonetheless prompted the departure of its chief executive.