ESG Colourwashing: Combating Modern-day Corporate Hypocrisy

Klemen Kreca, Associate, Schönherr Attorneys at Law
Timo Matthias Spitzer, Head of Legal Corporate and Investment Banking Germany, Austria, Switzerland & Scandinavia, Banco Santander, SA.

Driven partly by the COVID-19 crisis, Environmental, Social and Governance (ESG) criteria have gained significant relevance, creating a growing market demand for both ESG-based consumer and investor products. This is the product of a shift in consumer and investor preferences on the one hand, as well as increased political pressures on the other. A company might opt for ESG-compliance out of a sense of moral duty beyond the immediate financial interests of shareholders, thereby focusing on the wellbeing of all stakeholders including the wider society. Nonetheless, rarely are companies truly altruistic. Studies have found that integrating sustainability metrics into a business model more often than not creates real added financial value, betters the working environment and improves the reputation of the company significantly. Some if not most companies are being good, but only insofar as it benefits them financially. This in turn creates a significant moral hazard, where the appearance of ESG compliance could prove more lucrative than actually implementing ESG principles

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Germany Slovenia Compliance Banking & Finance February 2022 Vol.15, No. 58, Winter 2022

Klemen Kreca


Klemen Kreca is an associate at Schönherr Attorneys at Law and studying towards a Master's in Business at KU Leuven. Klemen graduated first in class from the Faculty of Law of the University of Ljubljana, was one of twenty recipients of the University’s special commendation for extraordinary academic achievements out of more than 40,000 students enrolled across all faculties, whilst winning all major national moot courts, tutoring fellow students, working at a renowned law firm and on various academic projects. Klemen holds an LL.M. in Finance from Goethe University in Frankfurt am Main, which is also where he interned for Deutsche Börse AG and worked as a legal trainee at Banco Santander's Corporate and Investment Banking Division.

Timo Matthias Spitzer


Timo Matthias Spitzer is an internationally acclaimed and purpose-oriented Head of Legal. He worked at three major banks and three leading international law firms. Timo is dually qualified as Rechtsanwalt (Germany) and Solicitor (England & Wales) with a First Class Honors LL.M. in International Economic Law from Victoria University of Wellington, New Zealand. He is a native German, fluent in English, French, Portuguese (Brazil) and Spanish. Timo is currently Banco Santander’s Head of Legal Corporate and Investment Banking for Germany, Austria, Switzerland and the Nordic Countries. He is also a Board Member and Adjunct Professor at the Institute for Law and Finance at Goethe University Frankfurt in a global Top 10 Master program for banking, finance and securities law as recognised by LL.M. Guide from 2018 to 2021. Timo is Chairman of The Legal 500 General Counsel Powerlist Germany Advisory Board and a Member of the General Counsel Leadership Circle and Advisory Board Member of the German Institute for Legal Departments and Corporate Lawyers (diruj) as well as of Deutscher AnwaltSpiegel, Business Law Magazine, Going Digital Magazine and Sustainable Value Magazine. He is the author of “The Importance of Human Leadership with Integrity in a Highly Regulated and Tech-Reliant Corporate Environment” as published by Harvard Business Law Review (February 2020). Timo is a keynote speaker at reputable conferences (e.g., at Harvard Law School). He is featured on The Legal 500 General Counsel Powerlists Germany 2017, 2019 and GC Powerlist Germany Teams 2018. Timo is the winner of the 2018 Santander Group Global WiseLegalSpeakers’ Award and the 2019 European and Global Counsel Awards by the Association of Corporate Counsel. He also acts as a judge for several legal awards.

Banco Santander, SA.


Views are my own and may not necessarily correspond to those of my organisation.

Schönherr Attorneys at Law


Schoenherr is a full-service law firm with a footprint in Central and Eastern Europe providing local and international companies stellar advice.

Germany Slovenia Compliance Banking & Finance February 2022 Vol.15, No. 58, Winter 2022

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