Risk Considerations

Investors should note that the Xtrackers ETFs & ETCs are not capital protected or guaranteed and investors in each Xtrackers ETF or ETC should be prepared and able to sustain losses up to the total capital invested. The value of an investment in an Xtrackers ETF or ETC may go down as well as up and past performance does not predict future returns. Investment in Xtrackers ETFs or ETCs involve risks. For a list of related risks please click on the Risks and Terms tab.

DWS-sponsored report reveals the rise of ESG’s ‘S’ pillar in pension portfolios

  • The ‘S’ pillar of ESG is becoming more important to pension fund managers
  • New report surveying pension funds from around the world sheds light on how pension funds are approaching the ‘S’ pillar

The ‘S’ pillar of environmental, social and corporate governance (ESG) is becoming an increasingly important driver of investment decision-making by pension funds, especially in light of the Covid-19 crisis, a new survey sponsored by DWS has found.

Sixty-six percent of pension funds surveyed intend to increase their allocations to ‘S’ pillar passive funds over the next three years, while 67% will select their passive manager based on their track record of delivery of their clients’ social agenda.

CREATE-Research, which conducted the analysis, surveyed 142 pension plans in 17 jurisdictions with collective assets under management of EUR 2.1 trillion. Forty of the pension plans subsequently took part in post-survey interviews to add qualitative depth to the findings. The final report, Passive Investing 2021: Rise of the social pillar of ESG, is launched today.

Other findings include:

  • Covid-19 was cited by 59% of respondents as a ‘key driver’ of their heightened interest in the ‘S’ pillar because of its growing materiality
  • Almost a quarter, 22%, of respondents reported that their ‘S’ pillar passive funds outperformed wider markets in the March 2020 crash
  • Over a third of respondents, 36%, seek to manage difficult-to-model fat-tail risks by investing in the ‘S’ pillar

This is the fourth year that DWS has sponsored the research, which also broadly explores the uptake by pension funds of passive investing. Previous reports have focused on stewardship and the environment.

“This important research shows not only that pension funds continue to embrace passive investments, but also the growing dominance of ESG and the importance of the ‘S’ pillar within that,” said Simon Klein, DWS Global Head of Passive Sales.

Professor Amin Rajan, CREATE-Research Chief Executive, commented: “Our 2021 survey shows how Covid-19 has exposed long-concealed failings of today’s market economies, but also how the increasing prominence of the ‘S’ pillar of ESG can play a role in addressing those failings.”

The full report can be accessed here.

DWS Group

DWS Group (DWS) is one of the world's leading asset managers with EUR 820bn of assets under management (as of 31 March 2021). Building on more than 60 years of experience and a reputation for excellence in Germany and across Europe, DWS has come to be recognized by clients globally as a trusted source for integrated investment solutions, stability and innovation across a full spectrum of investment disciplines.

We offer individuals and institutions access to our strong investment capabilities across all major asset classes and solutions aligned to growth trends. Our diverse expertise in Active, Passive and Alternatives asset management – as well as our deep environmental, social and governance focus – complement each other when creating targeted solutions for our clients. Our expertise and on-the-ground-knowledge of our economists, research analysts and investment professionals are brought together in one consistent global CIO View, which guides our investment approach strategically.

DWS wants to innovate and shape the future of investing: with approximately 3,500 employees in offices all over the world, we are local while being one global team. We are investors – entrusted to build the best foundation for our clients’ future.

Key risks

Investors should note that the Xtrackers UCITS ETFs are not capital protected or guaranteed and investors should be prepared and able to sustain losses of the capital invested up to a total loss.

Shares in the Xtrackers UCITS ETFs which are purchased on the secondary market cannot usually be sold directly back to the relevant fund. Investors must purchase and redeem such shares on the secondary market with the assistance of an intermediary (e.g. a market maker or a stock broker) and may incur fees for doing so (as further described in the applicable prospectus). In addition, investors may pay more than the current net asset value of a share in a Xtrackers UCITS ETF when buying shares on the secondary market, and may receive less than the current net asset value when selling such shares on the secondary market.

Investments in funds involve numerous risks including, among others, general market risks, credit risks, foreign exchange risks, interest rate risks and liquidity risks. The value of an investment in a Xtrackers UCITS ETF may go down as well as up and investors may not get back the full amount of their original investment.

Important Notice

This press release has been issued in the UK and approved by DWS Investments UK Limited. DWS Investments UK Limited is authorised and regulated by the Financial Conduct Authority.

Any reference to “DWS” shall, unless otherwise required by the context, be understood as a reference to DWS Investments UK Limited including any of its parent companies, any of its or its parents affiliates or subsidiaries and, as the case may be, any investment companies promoted or managed by any of those entities.

Past performance is not a guide for future returns.

Xtrackers UCITS ETFs are all ETFs of one of the following platforms: Xtrackers, Xtrackers II or Xtrackers (IE) plc.

Xtrackers, Xtrackers II and Xtrackers (IE) plc are undertakings for collective investment in transferable securities (UCITS) in accordance with the applicable laws and regulations and set up as open-ended investment companies with variable capital and segregated liability between their respective compartments.

Xtrackers and Xtrackers II are incorporated in the Grand Duchy of Luxembourg, are registered with the Luxembourg Trade and Companies’ Register under number B-119.899 (Xtrackers) and B-124.284 (Xtrackers II) respectively and have their registered office at 49, avenue J.F. Kennedy, L-1855 Luxembourg. Xtrackers (IE) plc is incorporated in Ireland with registered number 393802 and has its registered office at 78 Sir John Rogerson’s Quay, Dublin 2, Ireland.

DWS Investment S.A. acts as the management company of Xtrackers, Xtrackers II and Xtrackers (IE) plc.

The information contained in this document is provided for information purposes only. Any investment decision in relation to an Xtrackers ETF should be based solely on the latest version of the prospectus, the audited annual and, if more recent, un-audited semi-annual reports and the Key Investor Information Document (KIID), all of which are available in English upon request or on www.Xtrackers.com. In the case of any inconsistency with the prospectus, the latest version of the prospectus shall prevail.

© DWS Investments UK Limited 2021.


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