Unmasking greenwashing – the role of the news media in giving voice to whistleblowers in sustainable finance

Sustainable finance criticism in the news-media

The financial sector, as the driver of the global economy, plays a critical role in addressing climate change (Strauß, 2021b) and promoting sustainability by fostering sustainable business practices and redirecting financial capital (Lambillon and Chesney, 2023). However, complaints about irregularities and limited efforts in the SF field have emerged from academia and industry. The lack of a clear sustainability definition from European officials in 2022 led to market discrepancies and regulatory confusion (Klasa, 2022). Urgent regulatory intervention is needed to address systemic financial risks from climate change (Urban and Wójcik, 2019). Indeed, 2022 highlighted deception, fraud, and greenwashing in the financial sector, with NGOs such as ShareAction and InfluenceMap accusing it of greenwashing and challenging its commitment to sustainability (InfluenceMap, 2022; ShareAction, 2022).

Financial media, as both informants and chroniclers of market events (Strauß, 2021b), are also addressing allegations in the SF/ESG industry. The Financial Times (2022) reported growing criticism and greenwashing allegations, prompting US and German regulators to investigate. The Economist (2022) called for a redefinition of ESG investing, and WSJ questioned the EU’s proposal to classify specific energy investments as sustainable (Mackrael and Michaels, 2022). Forbes highlighted ESG as a checkbox activity for many, with accusations of greenwashing undermining the credibility of such investments (Rudin, 2022). Despite previous shortcomings in acting as watchdogs, such as during the Global Financial Crisis (2007–2009) (Knowles et al., 2017; Manning, 2012; Usher, 2012) and early SF reporting (Strauß, 2021b), it seems that financial journalists – at least from specialist financial news media – are now holding the financial sector accountable. One of the public actors that has attracted considerable media attention in the critical SF coverage lately are whistleblowers.

Whistleblowers – stories with news value

As evidenced by the reverberations in the media (e.g., WSJ, Forbes, or Financial Times), whistleblowing as “the disclosure by organization members (former or current) of illegal, immoral and illegitimate practices” (Near and Miceli, 1985: 4) plays an important role in fighting financial crime. Tariq Fancy, the former Global Head of Sustainable Investing at BlackRock, has sparked an uproar in the financial sector with his allegations in the news media against Wall Street (Bisnoff, 2021). He took a stance on “sustainable investing” and decried it as a “dangerous placebo that harms the public interest” (Fancy, 2021). Similarly, Desiree Fixler, the former Global Sustainability Officer at DWS, criticized the exploitation of ESG in DWS’s annual report. She disclosed the wrongdoings by talking to the WSJ: “As chief sustainability officer, as a proponent of ESG, how could I not speak up on wrongdoing” (Kowsmann and Brown, 2021).

Organizations have established ethics codes and reporting channels to address fraudulent activities like those in SF (Nisar et al., 2019). However, despite increased awareness, employees often fear repercussions for speaking up due to ineffective protections (European Commission, 2017). Several case studies (e.g., Bjørkelo et al., 2008; Hedin and Månsson, 2012) revealed that lack of support from supervisors and top management predicts retaliation (Mesmer-Magnus and Viswesvaran, 2005), causing whistleblowers to face anger and isolation (Hedin and Månsson, 2012). Serious consequences include job loss, transfer, or forced time off (UNESCO, 2022). Nonetheless, previous research has also shown that nearly all whistleblowers initially try to report misconduct through internal channels before turning to external ones (e.g., Near and Miceli, 1985). However, when internal support is low, past reports of misconduct were ignored or buried (Mesmer-Magnus and Viswesvaran, 2005), and other whistleblowers have been punished for coming forward (Dworkin and Baucus, 1998), outside entities such as the media (Hedin and Månsson, 2012) become alternative arenas to make the criticism publicly heard (Bosua et al., 2014).

Financial journalists often rely on experts to interpret news developments (Doyle, 2006), with whistleblowers serving as triggers for journalistic stories and investigations (Di Salvo, 2020). Whistleblowing cases that align with “existing news agendas and prevailing social and economic trends” (Wahl-Jorgensen and Hunt, 2012: 413) gain the most media attention. Indeed, several whistleblowers, such as those in the Watergate, Enron, and Cambridge Analytica cases, have garnered international media attention and shaped world events (Greenwood, 2022). Recent whistleblowers like Tariq Fancy and Desiree Fixler, who went public with SF-related allegations, have shaken the financial industry, but the relationship between SF whistleblowers and the news media remains underexplored. Hence, our first research question reads: RQ1 From the perspective of financial experts and whistleblowers themselves, what is the role of the news media in giving voice to whistleblowers in sustainable finance?

Whistleblowers as opinion leaders and the role of the news media

Financial news impacts the reputation of financial institutions (e.g., Picard et al., 2014), stock market values (e.g., Case and Clements, 2021), and climate change discourse (e.g., Feldman et al., 2017). It often reports misconducts, including financial fraud (e.g., Smith et al., 2022), insider trading abuses (e.g., Reuters, 2021), and more recently, greenwashing (e.g., Walker and Miller, 2022). Research indicates that financial news plays a crucial role in mediating financial information to the public (e.g., Strauß et al., 2023), actively shaping public attention (Shiller, 2005). Likewise, whistleblowing is central in disclosing corporate misconduct and holding governments and corporations accountable to society (Lewis et al., 2014). Whistleblowers attract media attention, initiate dialogue (Di Salvo, 2020), and influence management decisions to rectify organizational misconduct (Rehg et al., 2008). OLs shape public opinion and (political) behavior through personal influence and information dissemination, especially in high-media-attention topics (Nisbet and Kotcher, 2009). The following conceptual model introduces the idea that whistleblowers engage in opinion leadership within an organizational setting. It explores the common characteristics of both actors and presents a whistleblower as an OL in the SF/ESG field.

Katz (1957) specified three criteria that characterize OLs influence: First, influence is associated with the embodiment of certain values (“who one is”) (p. 73). This is akin to the whistleblower who has privileged access to an organization’s information or data (Jubb, 1999), such as Fancy and Fixler, who were senior executives at BlackRock and DWS, respectively (Eccles, 2021). Second, influence is associated with competence (“what one knows”) (Katz, 1957: 73), which corresponds to a whistleblower’s knowledge of misconduct or illegal activity (Jubb, 1999). This applies to Fancy and Fixler, who were insiders and had knowledge of misconduct in the financial sector and regarding SF for the organizations they worked for. Third, influence is associated with strategic social location (“whom one knows”) (Katz, 1957: 73), that is, the whistleblower’s outside entity (Jubb, 1999). Fancy and Fixler had relevant networks in the financial industry and the media (Eccles, 2021; Kowsmann and Brown, 2021), which allowed them to make their allegations public. Table 1 in supplemental, drawing on the definitions of Katz (1957) and Jubb (1999), shows the extent to which whistleblowers exhibit characteristics of OLs and highlights the cases of Fancy and Fixler in the SF/ESG industry.

Whistleblowers draw international media attention (cf. Greenwood, 2022) and spark discussions among various stakeholders in the news media (Beckers et al., 2021). Investigating news coverage of whistleblowing by Fancy and Fixler becomes of paramount interest, given the financial news media’s critical role as watchdogs in exposing wrongdoing (Manning, 2012; Tambini, 2010; Usher, 2012). Watchdog journalism often seeks the “great story,” the long-form journalism with the transformative potential to expose social issues, corruption, and more (Usher, 2014). Journalists rely on whistleblowers on topics, such as SF, and in turn can provide them a platform for their voice and help them make misconduct public. Although media and communication scholars argue that news media are critical in providing information and interpretation on social and political issues (e.g., Beckers et al., 2021), there has been little empirical work on how the financial news media cover whistleblowers in the realm of SF. Hence, the second research question aims to address this gap: RQ2 How has (a) Tariq Fancy’s and (b) Desiree Fixler’s whistleblowing on sustainable finance been covered in international financial news media online?

Case selection and data collection

The two guiding research questions were investigated by a combination of two qualitative empirical methods. For RQ1, eight expert interviews were conducted, including the DWS whistleblower Desiree Fixler. For this purpose, interview requests to individuals responsible for SF/ESG investment in Europe, who were identified through (a) personal networks and (b) publicly available information, were sent through LinkedIn. In total, seven financial experts (3 female/4 male) from different backgrounds (e.g., banking, asset management, NGO) and countries (Switzerland, Germany, and the UK) agreed to participate in the study. Their experience in SF/ESG varied from 5 to 12 years. No further information on the respondents is provided at this point since all respondents were assured of a high level of confidentiality and complete anonymization of interview data. In addition, an interview with Desiree Fixler was conducted, and she agreed to be disclosed. ¹ Before the interviews began, informed consent was obtained from all interviewees and permission was requested to record the interviews. All interviews were conducted via Zoom based on a semi-structured interview guide (see Appendix A). They took place between March and April 2022 and lasted between 21 and 66 min. After all interviews were completed, the anonymized audios were sent to a transcription service in the UK and Germany.

Interview analysis

The interview transcripts were analyzed according to the concept of qualitative content analysis (cf. Rubin and Rubin, 2011) using MAXQDA. The aim of the analysis was to summarize the main themes of the interviews to investigate the role of the news media in giving voice to whistleblowers in SF. To identify the core themes from the interviews in a systematic and condensed form, a content structuring approach of qualitative content analysis was used (cf. Gläser-Zikuda et al., 2020). Main categories were deductively formed based on the research question, the interview guide, and the theoretical framework. In reviewing the transcripts, additional main categories as well as subcategories were then inductively formed. For example, the subcategory that ESGs were used as a ‘marketing strategy’ was inductively added to Desiree Fixler’s critique. In a final step, the transcripts were analyzed in their entirety using those main categories and subcategories. Using this approach, specific patterns and indications of the media’s role and whistleblower criticism of SF/ESG were identified. Although all interviews were analyzed using the same method, different categories were formed for the interview with Desiree Fixler than for the analysis of the other interviews with individuals from the financial sector.

News data and data collection

To answer RQ2, the study employed a qualitative content analysis approach that was deemed suitable for investigating media coverage patterns of whistleblower activities and obtaining contextual qualitative results (cf. Di Salvo, 2020). This method has previously been applied to financial news media research, proving its suitability (e.g., Strauß and Smith, 2019).

Financial journalism for targeted audiences distinguishes itself from other news sources with exceptional analytical depth (Doyle, 2006) and a focus on intricate topics like SF (Strauß, 2021c) or whistleblowing (Borden, 2007). The following media outlets, known for serving business professionals, investors, and decision-makers (e.g., Financial Times, 2022; The Economist, 2024; WSJ, 2024), qualify as key sources for investigating news coverage on SF whistleblowing: five major financial news sites (Forbes, MarketWatch, Bloomberg, Reuters, The Economist), two top international business news outlets (Financial Times and Wall Street Journal), and two ESG investment news outlets (Bloomberg Green and Responsible Investor). The study analyzed news coverage of the two whistleblowers cases (Fixler & Fancy) by collecting all online news articles using the keywords (a) ‘Tariq Fancy’ from the date of his first essay in USA Today (16 March, 2021) where he made his criticism about SF public, and (b) ‘Desiree Fixler’ from the date of her dismissal (11 March, 2021) to the end of the year (31 December, 2021). In total, the analysis included 74 news items, with 36 items for Tariq Fancy and 38 items for Desiree Fixler (see Table 2 in supplemental for an overview).

Text analysis

A qualitative text analysis was used to examine the online articles, which is a suitable approach for analyzing SF/ESG communication (e.g., Strauß, 2021c) and whistleblower activities (e.g., Powell, 2021). Additionally, this method is well suited for media and journalism research because the narrative character of media content requires “special scholarly engagement” (Fürsich, 2009: 238). To ensure an open-ended approach to assessing each message (Strauß and Smith, 2019) and given the novelty of the topic (whistleblower activities in the SF/ESG realm), a codebook with open-ended questions for each variable was constructed (see Appendix B). The news items were read and coded using a semi-structured codebook that included formal variables (e.g., news outlet, date, title) and open content categories (e.g., main topic of the news item, mentioned whistleblowers, voices heard in the news item, and arguments about sustainable investing/ESG). In an interpretative and analytical process, the codings for each news articles were then compared with each other to form overall impressions and draw conclusions.

News media as a dissemination-platform for whistleblowers

In the interview with the whistleblower herself, Desiree Fixler, it became clear that the news media not only played a key role in giving voice to her criticism about DWS’s ESG practices, but that the media was also used by DWS to discredit her. As Fixler explained, she was initially hired by DWS to help them reform and become a leading ESG asset manager. In her role as Global Sustainability Officer, Fixler took stock of the situation and found several issues related to the ESG integration: “There was miscommunication, misstatements to both the company shareholders and to the company’s investors.” Therefore, she was insisting on making changes in the ESG realm: “I’m a sustainability officer. I have to do this. How can I ignore the G in ESG? It’s about governance.” However, Fixler’s articulate address of the issues surrounding DWS’s ESG investments ultimately led to her dismissal and DWS tried to ruin her reputation by making negative, non-job-related allegations public. According to Fixler, the CEO of DWS released an internal memo, claiming she had left because they didn’t receive enough traction with sustainability and ESG and that he was taking over so they can progress: “It’s an internal memo that basically says I underperformed, and he questions my business ethics.” The same memo was also sent to Bloomberg: “The strategy was to not only fire me, but to ruin my reputation, to crush me. It was extremely damaging. They also embarked on a smear campaign calling up journalists to accuse me of all sorts of things – They just made up lies.”

While there wasn’t any evidence for DWS’ allegations about Fixler, journalists started contacting Fixler. She decided to speak up and tell WSJ her side of the story instead of going to BaFin (German financial regulator) because she felt she would not get any help from them:

I responded by going to the Wall Street Journal. I felt I couldn’t go to BaFin, the German regulator, because I did not trust the leadership and culture given their stance on Wirecard ² (…) Many advised me that the regulator in Germany doesn’t want to hear anything negative about their national champions. That light supervisory touch is likely why Deutsche Bank is in the mess they’re in. That coupled with little whistleblower protection in Germany drove me to speak out publicly. I felt, ‘I’m going to confront this. I’m going to get the truth out through the press.’ I met with the Wall Street Journal, and they took a story in.

Fixler explained that she turned to the media primarily because she witnessed the misstatements and wrongdoings at DWS and wanted to bring the truth to light and point out the exploitation of ESG: “Here it is, we have these incredible, insane and horrific global challenges and these people are pretending they’re mobilizing billions of dollars into ESG when they’re not.” Experts in the SF/ESG field who were interviewed in this study also pointed out how difficult it is to talk about greenwashing when people like Desiree Fixler are fired for speaking up: “I think there are probably many more who are not comfortable like Desiree [Fixler].”

Yet despite the challenges Fixler faced as a whistleblower, she also sees a positive side to the whole story: As her disclosures were picked up by the media, they also impacted the asset management industry and caused executives to rethink their ESG products. As a result, Desiree Fixler believes that her whistleblowing actions have done some good, as they have led to a productive and constructive discussion in the marketplace that could improve the entire field of ESG investing. While she is not sure about being an ‘opinion leader,’ she clearly states that she is expressing her opinion in the discussion around ESG: “I don’t know about leader, but yes, I’m voicing my opinion.” In fact, according to the financial experts interviewed, the media attention on Desiree Fixler and Tariq Fancy prompted client questions and stimulated discussions about SF/ESG: “Because this issue [greenwashing] receives significant media coverage, particularly in instances involving whistleblowers, we [financial experts] are repeatedly questioned about it. This is because we [financial experts] are also impacted by it.” Following the previously cited interviewee, it is good that whistleblowers are challenging the financial industry. As the person points out, there are many financial products that claim to be sustainable but are not. Indeed, during the discussion on whistleblower activities related to SF/ESG investments, a banking industry representative believed that there will be an increase in whistleblowing incidents concerning the ESG field that will be covered in financial news media: “We will see more whistleblowing around the topic of ESG.”

Similarly, most financial experts interviewed in the study perceived the news coverage of whistleblowers, including the case of Fixler, as a useful tool for highlighting industry issues and initiating discussions about SF/ESG. One respondent from Germany noted that the case of Desiree Fixler was covered extensively in various news outlets, while another expert emphasized the media’s important role in exerting public pressure on companies “to give up certain practices [that is, greenwashing].” According to the expert, this is crucial because it educates the public about the misconduct and exerts public pressure on companies. Along the same lines, a sustainability expert pointed out the importance of creating awareness: “Talking about those whistleblowers allows us to create awareness about the topic, which is a positive thing.” However, one interviewee also said that the media is always looking for the “big titles” and that this does not help the industry. Simplistic claims without concrete and clear words could be misleading, as they give the impression that ESG in general does not have a positive impact. Many respondents indicated that there is a lot of misinformation in the SF world, making it difficult to navigate. Financial professionals therefore need to raise awareness and educate people on SF/ESG to ensure that people understand the impact of their investments – even if this means using the media as a conduit.

Based on the insights from the interviewees and Fixler’s insights as a whistleblower herself, it became clear that the news media played a central role in raising attention to ESG issues in the financial sector. This prompted further exploration of how the news media reported on the two whistleblower cases: Desiree Fixer from DWS and Tariq Fancy from BlackRock.

Coverage of whistleblowers’ criticism in the news

On 16 March, 2021, Tariq Fancy published his op-ed “Financial world greenwashing the public with deadly distraction in sustainable investing practices” on US Today. This op-ed received significant media attention and was followed by the publication of the essay by Fancy himself, “The Secret Diary of a ‘Sustainable Investor’” in the Medium. The results of the content analysis show that Tariq Fancy’s criticisms were picked up by all nine news outlets examined, with the Financial Times being the first to report and taking the lead in the coverage with nine articles (out of 36). Bloomberg followed closely with seven articles, or 13 if Bloomberg Green is added. The majority of the articles (34) featured other voices, such as professors (e.g., Financial Times), financial experts (e.g., Bloomberg), think tanks (e.g., WSJ), or NGOs (e.g., Forbes). Only one article featured Fancy alone, and another was written by Fancy himself.

All nine news outlets examined cited Fancy’s claim that ESG is an “expensive placebo” with no real-world impact. Relatedly, The Economist stated Fancy’s argument that ESG delays regulatory reform because it distracts from the real problem. MarketWatch reflected that only government action can solve climate change. Forbes discussed Fancy’s stance that the free market will not self-regulate when it comes to addressing climate change. Bloomberg further laid out Fancy’s view that ESG is being used as a marketing tool and a PR spin.

The reason for the coverage of Fancy’s allegations is the controversy surrounding ESG, with ongoing debates fueled by the lack of standards and regulations. The articles analyzed expressed skepticism towards SF/ESG, with 19 of 36 articles taking a critical stance, nine being balanced, and only seven expressing hopes for ESG. BlackRock was mentioned in all nine outlets, but only one article in WSJ mentioned consequences (potential reputational damage) for the asset manager. It is noticeable that not a single article mentioned any consequences for Fancy, with him stating, “I couldn’t have said the same things while I was still in the industry” (Fancy in WSJ, Power, 2021). Moreover, six articles explicitly mentioned the word “whistleblower” and one article in The Economist was written by Fancy himself. Four articles had the term in their title, with the MarketWatch article mentioning both whistleblowers by name, specifically Desiree Fixler.

Less than 6 months after Tariq Fancy’s essay, an article was published in WSJ on 1 August, 2021, about Desiree Fixler’s allegations against DWS, claiming that DWS overstated its sustainability efforts. This article alike to Fancy’s case generated considerable follow-up media attention, with Bloomberg leading the coverage with 16 articles, 18 if Bloomberg Green is added (out of 38). All of the articles focused on the consequences of the whistleblower’s allegations, such as ongoing lawsuits and allegations against DWS for overstating its sustainability efforts in its 2020 annual report. Responsible Investor, Bloomberg and Financial Times associated DWS’s inflation of the value of ESG investments with greenwashing. Towards the end of the reporting period examined, the media shifted from discussing the DWS case to general allegations in the SF/ESG sector, and many news outlets highlighted the need for clear standards and regulations to prevent greenwashing. Out of the 38 articles, 25 featured DWS’s denial of the allegations, including quotes from Christian Sewing (CEO of DB), Asoka Wöhrmann (CEO of DWS), and a spokesperson. WSJ, for example, quoted a spokesman by stating that DWS “stands by its ESG disclosures and rejects the allegations being made by Ms Fixler” (Brown and Kowsmann, 2021).

Desiree Fixler’s allegations against DWS were focused on the company’s misconduct and were not a criticism of SF/ESG in general. This was reflected in all the news outlets analyzed, with 24 of 37 articles presenting a balanced view on SF/ESG, followed by a fewer number of praising and critical articles (seven of 37). Greenwashing caused by poor data and conflicting standards was highlighted as a problem, including by Fixler herself. Only two articles focused solely on Fixler (MarketWatch and Bloomberg), while the rest featured a variety of individuals, such as regulators BaFin and the SEC (e.g., Responsible Investor and WSJ), DWS executives and spokespeople (e.g., WSJ, Bloomberg, and MarketWatch), financial journalists (e.g., Forbes and WSJ), and analysts (e.g., Bloomberg Green and Forbes). Tariq Fancy was mentioned in five articles and the word “whistleblower” in 12.

Desiree Fixler’s allegations led to her dismissal, as reported in 24 of the 38 articles analyzed. All but five articles cited multiple consequences for DWS, including internal investigations, falling share prices, regulatory investigations, fines, and reputational damage. The articles noted that this is the first time a company has been investigated for false ESG claims, making it a significant case that could lead to regulatory action and industry-wide lawsuits. For example, Financial Times reported that the “regulatory investigations into DWS are unlikely to be a one-off” (Mooney and Flood, 2021). Bloomberg stated that regulators may require standardized disclosure and detailed reporting for ESG-labeled products (Arons, 2021).

Overall, the coverage about Fixler’s case centered more on the corporate case of DWS’ exploitation of ESG and the greenwashing accusations, whereas the coverage of Fancy’s case focused more generally on allegations against ESG/SF products and the finance industry. Fancy in particular warns in the articles about harming the public interest, whereas Fixler highlights the significance of SF in mitigating environmental damage and improving working conditions and diversity in companies. All articles investigated (Fixler and Fancy) stressed the importance of disclosing criteria and data for labels such as “green,” “low carbon,” or “sustainable,” but expressed a strong call for more regulation in the field of ESG/SF. Moreover, WSJ was the first to bring Fixler’s allegations to public attention and taking on a passive watchdog role. Similarly, Financial Times presented Fancy’s claims in depth, and additionally provided a variety of angles (e.g., expert opinions). However, other news outlets only put the issue in context (e.g., regulations needed, potential for change) without further investigation (e.g., Market Watch for Fancy and Bloomberg for Fixler). In addition, Forbes, Reuters, and The Economist simply provided a platform for Fancy to discuss his allegations.