The U.S. Securities and Exchange Commission (SEC) has imposed a civil penalty of $17.5 million on Invesco Advisers, Inc. for making misleading claims regarding the integration of Environmental, Social, and Governance (ESG) factors in its asset management services. The SEC found that between 2020 and 2022, Invesco inaccurately stated that 70-94% of its assets under management were ESG integrated, despite including passive exchange-traded funds (ETFs) that did not incorporate ESG criteria.
Additionally, the SEC highlighted that Invesco lacked a formal policy defining ESG integration, which further supported the inaccuracies in their claims. Sanjay Wadhwa, Acting Director of the SEC’s Division of Enforcement, emphasized the importance of honesty in client communications, stating that companies should not exploit investing trends and buzzwords. Invesco has agreed to pay the fine, accept a censure, and cease further violations without admitting to or denying the SEC's conclusions.
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