Deutsche Bank’s €5.5bn pension funds aim to raise ESG allocation

Banking giant wants to expand on current €100m ESG allocation

Deutsche Bank says it has a long-term goal to expand on the current €100m it has solely invested in environmental, social and governance (ESG) criteria in its own €5.5bn pension funds.
“As with our asset management services, we apply sustainability criteria to our investment decisions for the pension plans of our employees as well,” the bank giant has said in its latest Sustainability Report. “Deutsche Bank pension funds have a volume of €5.5bn, of which €100m are already invested solely according to ESG criteria.
“Our long-term goal is to expand this type of investment.”
Deutsche had €3.1bn in sustainable funds/thematic funds under management for clients at the end of last year, according to the report.
Its goals for 2011 include increasing such funds’ volume and integrating the UN Principles for Responsible Investment into the investment process.
Another stated ambition is the “expansion of our range by building Multi Asset Products and ESG Advisory (service)” – although bank spokespeople have declined to comment further on this.
Meanwhile, a Deutsche research note has called for a “statutory framework” to help address a lack ofuniform standards and definitions in responsible investing.
Among its ideas are a “more far-reaching” version of Eurosif’s transparency guidelines and a “legally anchored quality seal” for RI. It also supports the key performance indicators [KPIs] approach developed by the German financial analysts association DVFA and adopted by EFFAS, the European Federation of Financial Analysts Societies.
“One of the key challenges for the development of the market for responsible investments is the establishment of uniform standards and definitions assuring an adequate level of product transparency,” the note says.
It reckons the lack of uniform criteria and standards relates not only to corporate reporting standards but also to the definition of investment principles by investment product providers.
Report authors Susann Schmidt and Christian Weistroffer said: “A statutory framework can be supportive in establishing uniform standards and definitions and provide incentives for the implementation of ESG-based investment approaches.” Large institutional investors can also have a role in forging standards.