SEC Charges Invesco Advisers for Misleading ESG Claims, Imposes $17.5 Million Fine

Invesco Advisers, Inc. is paying a hefty price for misleading clients and investors about how much of its assets were truly aligned with environmental, social, and governance (ESG) principles. The Atlanta-based investment firm has agreed to settle with the U.S. Securities and Exchange Commission (SEC), which has charged the company with inflating the percentage of its assets that were “ESG integrated.” As part of the settlement, Invesco will pay a $17.5 million civil penalty.

From 2020 to 2022, Invesco told clients and promoted in its marketing materials that between 70 and 94 percent of its total assets under management (AUM) were “ESG integrated.” However, the SEC’s investigation uncovered that a significant portion of these assets were actually in passive exchange-traded funds (ETFs), which did not factor in ESG considerations at all. To make matters worse, the SEC found that Invesco didn’t even have a formal written policy in place defining what ESG integration actually meant, raising questions about how seriously the company took its own claims.

“Invesco saw a commercial opportunity in boasting about how much of its portfolio was ESG-integrated,” said Sanjay Wadhwa, Acting Director of the SEC’s Division of Enforcement. “But saying it doesn’t make it true. Companies need to be clear, honest, and transparent with their clients, rather than jumping on the ESG bandwagon for the sake of buzzwords.”

The charges center on the company’s willful violations of the Investment Advisers Act of 1940. Without admitting or denying the findings, Invesco has agreed to cease and desist from future violations, undergo a censure, and pay the hefty penalty.

This case adds to the growing body of regulatory attention on ESG claims in the investment sector. With ESG investments increasingly popular, regulators are underlining the importance of making accurate, substantiated claims—not just riding the wave of a trend. For Invesco, this fine serves as a reminder of the price of stretching the truth in an era where trust is everything.

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