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1for pension solutions, driven by the shift from defined benefit to defined contribution 2schemes.3d) Geographic wealth shift: Emerging countries, primarily in Asia, will continue to be key 4drivers of future industry growth, offering new opportunities for asset managers as local 5investors expand their investment horizons globally and look for investment solutions. 6e) Market consolidation: Scale and the ability to offer a diverse range of investment 7capabilities will be increasingly central to asset managers’ ability to compete successfully 8in the marketplace. Over the longer-term further industry consolidation is anticipated as 9firms look for operational efficiency and geographic coverage, however, in the near-term 10firms are using bolt-on deals, minority stakes or joint ventures to bolster capabilities.11f) Margin erosion: Pressure on fees and costs will persist, driven by higher regulatory and 12compliance costs, heightened market competition and the continuing shift by investors 13towards large scale, lower fee, passive products. 14Although markets will experience turbulence in the near-term, due to economic and 15geopolitical headwinds, the longer-term outlook for the industry remains positive.16DWS Group17The following section should be read in conjunction with the sections on ‘18Global Economic 19Outlook’ and ‘Asset Management Industry’. The wider industry challenges such as continued 20margin pressure, rising costs of regulation and competitive dynamics are likely to remain. 21In the face of this challenge, DWS continues to focus on innovative and sustainable products 22and services where we can differentiate and best serve clients in the current demanding 23environment, while also continue to operate with an utmost cost discipline.24In 2024, we are aiming to proceed on our path towards our medium-term strategic targets 252025.26We expect the adjusted cost-income-ratio to be essentially flat compared to 2023, i. e. to 27develop within a range of 63% to 65%. Our earnings per share are assumed to be slightly 28higher in 2024.29The growth areas – Passive and Alternatives – are expected to further contribute with net 30inflows to the AuM development. Passive AuM are expected to be considerably higher 31compared to 2023, while Alternatives AuM are expected to be slightly higher compared to 322023. Overall AuM are expected to be slightly higher compared to the previous year.33Opportunities and Risks34GRI 3-335Macroeconomic, Geopolitical and Market Environment36Opportunities37Our strategy has evolved along with the changing asset management industry and is 38contributing, directly and indirectly, to anticipated growth rates as well as our medium-term 39net flow target.40Asset managers are playing an increasing role in providing capital to the economy, taking 41advantage of bank retrenchment due to the latter’s regulatory and capital constraints and 42diminished ability of national governments to fund infrastructure investment.43Our strategy includes the deployment of capital to achieve both organic and inorganic 44growth. Our medium-term business plan includes an increase in seed and co-investments to 45grow our business organically while continuing to align with client demand. We also believe 46the trend of consolidation in the asset management industry will continue. We intend to 47deploy growth capital for mergers and acquisitions in a disciplined way by considering 48consolidation opportunities in the industry that will enhance our market position in key 49growth areas, and/or for distribution access. Any merger and acquisition activity, in addition 50to meeting strategic objectives, will focus on the prioritization of shareholder value creation 51and be measured against financial criteria such as attractive return on investment, earnings 52accretion and contribution to our medium-term targets for net flows and adjusted cost-53income ratio.54Risks55Uncertainty remains elevated for the world economy. While annual inflation started to fall in 562023 and is expected to continue to do so in 2024 there are risks to the upside. Inflation may 57re-accelerate, for example driven by premature softening of monetary policy amid stubbornly 58high wage growth. Energy price shocks, food prices or other commodity price shocks could at 59least temporarily drive inflation again. Likewise, the many geopolitical crises could create 60commodity shocks or supply chain issues. In some scenarios, central banks would need to 61react by increasing interest rates with the risk of leading global economies into recession. 62        63To our Shareholders Summarised 64Management Report65Consolidated 66Financial Statements Compensation Report Corporate Govern-67ance Statement68Supplementary 69Information DWS 2023 Annual Report70 71Outlook7221 DWS Group