DWS chief executive Asoka Woehrmann has resigned from the German asset manager, less than 24 hours after a raid on the business by German police and regulator BaFin.
Effective 10 June, Woehrmann will leave the firm in the hands of Stefan Hoops, who currently serves as head of corporate bank at Deutsche Bank, with David Lynne, current head of corporate bank, Asia Pacific, taking on Hoops' soon-to-be former role.
In a departing memo to employees, outgoing CEO Woerhmann told employees it was a joy to see the firm flourish but the "allegations…, however unfounded or undefendable, have left a mark," according to Reuters.
He then quoted Charles Dickens' A Tale of Two Cities: "It was the best of times, it was the worst of times."
Yesterday's (31 May) raid comes in the wake of a whistleblower report and saw around 50 officers enter the DWS and Deutsche Bank offices in Frankfurt, over allegations of greenwashing and misleading investments.
DWS and Deutsche Bank raided by police following whistleblower claims of greenwashing
This is not the first time DWS has faced allegations over this type of misconduct.
Desiree Fixler, the former head of sustainability at the firm, claimed that the firm had overstated its ESG credentials in its 2020 annual report, while DWS decried the allegations as "unfounded".
President of Deutsche Bank Karl von Rohr thanked Woehrmann for his contribution to the firm, adding that he had "great respect for his decision to resign - it is a testament to his sense of responsibility".
Of his tenure, Woehrmann said: "I have always dedicated my entire energy to the benefit of DWS; most notably since returning as CEO in October 2018.
"Today, after the three most successful years in its history, DWS is significantly more profitable, is stable and has continued to perform well in a difficult market environment.
"At the same time, the allegations made against DWS and myself in past months have become a burden for the company, as well as for my family and me. In order to protect the institution and those closest to me, I would like to clear the way for a fresh start."
In early industry reaction, Janine Alexander, partner at law firm Collyer Bristow, said: "It has long been suspected by many in the industry that when called upon to prove the claims made, even in good faith, in prospectuses many organisations would find it difficult to do so whether by lack of attention to record keeping and policy documentation, carelessness, recklessnesses or fraud.
"This is likely to be the tip of the iceberg and all businesses claiming ESG credentials and selling on the back of them should take note and get their house in order"
