Invesco Advisers charged with making misleading statements about ESG integration

Invesco Advisers has agreed to pay a $17.5 million civil penalty after the Securities and Exchange Commission (SEC) charged it with making misleading statements about integrating ESG in investment decisions.

© Shutterstock

According to the SEC, between 2020 and 2022, Invesco told its clients that between 70 and 94 percent of the assets under management by its parent company were ESG (environmental, social and governance) integrated. However, the SEC said, a substantial amount of assets were held in passive ETFs that did not consider ESG factors in decision making. The SEC also found that Invesco lacked written policy to define ESG integration.

“As stated in the order, Invesco saw commercial value in claiming that a high percentage of company-wide assets were ESG integrated. But saying it doesn’t make it so,” Sanjay Wadhwa, Acting Director of the SEC’s Division of Enforcement, said. “Companies should be straightforward with their clients and investors rather than seeking to capitalize on investing trends and buzzwords.”

The SEC charged Invesco with willfully violating the Investment Advisers Act of 1940. Invesco agreed to stop marketing as such, and to be censured, in addition to paying a $17.5 million civil penalty.

Based in Atlanta, Ga., Invesco was founded in 1935 and currently has offices in more than 20 countries, according to its website. With nearly $1.8 trillion in assets under management, Invesco is listed on the New York Stock Exchange. As of Nov. 8 at 2 p.m., its stock had fallen 1.5 percent on the SEC’s news to $18.01 per share.