Invesco to pay $17.5 million against greenwashing allegations 

November 13th, 2024

Invesco advisers have designated $17.5 million to resolve allegations that the firm had been greenwashing, according to the Securities and Exchange Commission (SEC). 

 The allegation follows a claim that the volume of assets in its funds dedicated to environmental, social and corporate governance themes are exaggerated.  

The SEC alleges that from April 2020 to July 2022, Invesco “made misleading statements” concerning the assets labelled as “ESG-integrated”. 

During 2019, it is alleged that Invesco grew concerned by its competitor’s levels of ESG investment, spiking an internal review warning that at least $370 billion of the adviser’s assets were “at risk” of mitigating to a competitor with greater ESG offering, according to SEC. 

In response, Invesco ramped up its “ESG integration” strategy and published an ESG stewardship report claiming that its percentage of overall ESG integrated assets ranged from 70% to 94%. 

However, those percentages included assets held in Invesco’s passive strategies, which are not properly qualified to be deemed ESG integrated since they weren’t actively managed and did not track an ESG index, according to the commission.  

According to Morningstar, Invesco’s largest exchange-traded fund, the Invesco QQQ Trust (ticker: QQQ) was included in those calculations. It has $313 billion in assets under management, for example. 

Invesco settled the allegations without admitting or denying misconduct, stating that it is “pleased to resolve this matter related to historical statements.” 

The company notes that the commission did not cite it for disclosures relating to any specific fund or strategy—the complaint focused on its ESG reporting in aggregate. 

“Invesco Advisers cooperated fully with the investigation and will continue to take a client-led approach of offering investment strategies tailored to the specific investment objectives of its clients,” it said. 

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