Invesco ESG ETFs

ESG investing with Invesco ETFs

Build sustainable investing portfolios with precision and confidence

Recent years have seen ETFs become a key component of Environmental, Social and Governance (ESG) portfolios. By blending innovation with thoughtfulness, we’ve designed our wide range of ESG ETFs to empower investors to choose their own journey through sustainable investing.

Whether your clients simply want to avoid certain companies or industries, or help drive positive change, our wide range of ESG ETFs can help you build portfolios that reflect values that matter to your clients.

Spotlight: Thematic ETFs

We’re living in an age of disruption, where everything appears to change at lightning speed. Technology is transforming our lives and redefining entire industries. Meanwhile, climate change, declining birth rates, and an aging population are due to reshape society.

These are just some of the ‘megatrends’ at work in the world today with the power to reframe the way we live, what governments prioritize and how businesses operate and succeed.

We offer a broad set of ETFs that seek to capture the opportunities to be found in some of these disruptive themes.

Choose your ESG journey

ESG isn't a 'one size fits all' solution. No two investors' wants and needs are exactly the same. Let us help you navigate your ESG journey to finding an ETF that aligns with your values.

Investment risks

  • Any investment decision should take into account all the characteristics of the funds as described in the legal documents. For sustainability related aspects, please refer to  https://www.invescomanagementcompany.ie/dub-manco. An investment in these ETFs is an acquisition of units in a passively managed, index tracking fund rather than in the underlying assets owned by the ETFs

    Investment risks - please click here to view all ETF specific risks. For complete information on risks, refer to the legal documents. The value of investments, and any income from them, will fluctuate. This may partly be the result of changes in exchange rates. Investors may not get back the full amount invested. 

Why Invesco for ESG ETFs?

Our ESG approach is centred around client needs. Most investors choose ESG ETFs for the same reasons they choose any other ETF: simplicity, low costs, transparency, tradability and often for the efficient way it tracks a reference index.

With all of our ESG ETFs designed to meet specific objectives, we provide our clients with complete clarity on their goals and precisely how they aim to deliver that outcome.

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Insights

  • ESG
    Climate%20investing:%20Mitigation%20and%20adaptation%20
    ESG

    Climate investing: mitigation and adaptation

    By Paul Jackson

    Climate change is challenging societies and to address the risks it’s essential we invest in mitigation and adaptation strategies. Find out more.

    15 May 2024
  • Fixed Income
    Invesco%20monthly%20fixed%20income%20update
    Fixed Income

    Monthly fixed income update

    By Paul Syms, Raphael Stern, CFA

    Following the bounce in March, fixed income markets performed poorly in April, as rate cut expectations were pushed back once more. Read our latest thoughts on how fixed income performed and what we think you should be looking out for in the near term.

    10 May 2024
  • ETC
    Invesco%20monthly%20gold%20update
    ETC

    Monthly gold update

    By Invesco

    The gold price rose by 2.5% in April; the metal again broke multiple price records. We believe the key drivers for the upward trend in the gold price remain intact. Discover insights into the key macro events and what we think you should be keeping your eyes on in the near term.

    9 May 2024
  • ESG and responsible investing
    UK%20Stewardship%20Code%20Report
    ESG and responsible investing

    2023 UK Stewardship Code Report

    By Invesco

    Our 2023 UK Stewardship Code Report details how we're supporting good stewardship practices in the UK and beyond.

    3 May 2024
  • ETF
    The%20Nasdaq-100:%20How%20innovation%20is%20powering%20your%20cup%20of%20coffee
    ETF

    The Nasdaq-100: How innovation is powering your cup of coffee

    By Invesco

    Technology has disrupted just about everything. Learn how innovation is driving something as simple as your favourite cup of coffee.

    24 April 2024

ESG ETF investing FAQs

Most investors choose ESG ETFs for the same reasons they choose any other ETF: simplicity, low costs, transparency, tradability and often for the efficient way it tracks a reference index. With each Invesco ESG ETF designed to meet specific objectives, you have complete clarity on the goals and precisely how it will deliver that outcome. 

This has been an area of increased focus, with some studies suggesting a positive relationship betweeen a company’s financial and ESG performances. Moreover, some ESG indices have recently outperformed their parent (non-ESG) indices, which is partly due to the sector biases that occur naturally from exclusions, e.g. reduced weighting in energy, but could also be attributed to investors’ placing a “premium” on companies that are successfully managing ESG risks.

Whether or not ESG on its own can drive performance, investors can now find ETFs that have both ESG and financial objectives. You can choose between ESG ETFs that aim for similar returns as the parent index (with meaningful ESG improvement) or that have a greater tolerance for tracking error (with much more ESG improvement).   

With environment one of the three ESG pillars, most ESG ETFs will include climate considerations either implicitly or explicitly in the index methodology. Some of our Invesco ESG ETFs go a step further by having specific climate-related goals, such as the Paris-aligned benchmark, reducing overall carbon intensity and/or increasing the amount of green revenues in the portfolio. We also offer thematic ETFs for focused exposure to climate solutions such as clean energy and solar power. 

The simple answer is that any ETF that physically holds shares in a company can exercise its rights. All but one of our ESG ETFs replicate their indices by physically holding the shares. Our passive equity ETFs will vote in line with the largest active position held by Invesco, or with our ESG guidelines if no active position is held. Our global ESG team and investment managers engage with companies on key ESG issues, which includes many of those held by our passive ESG ETFs. 

We’ve been helping investors incorporate their ESG objectives for the past 35 years and aim to include ESG considerations across all our investment strategies where possible. We believe engagement is one of the most effective mechanisms to reduce risks, maximise returns and have a positive impact on society and the environment. We are also committed to being a good corporate citizen and are signatories to key industry initiatives especially in the fight against climate change.

As ESG continues to grow globally, different regions have made efforts to introduce regulatory standards. Regulation will be a key factor in ensuring that efforts to integrate ESG have a tangible impact. It’ll also help to drive the standardisation of measuring and reporting.

The EU has introduced green taxonomy, Sustainable Finance Disclosure Regulation (SFDR) and most recently, the Sustainable Finance Strategy to provide rules and structure to the way businesses report on their ESG activities.

Greenwashing is when companies portray a public image of sustainability but aren’t taking sufficient or tangible action behind the scenes or undertake other questionable business activities. It could be a global drinks company committing to using 100% recycled plastic but setting no actual target, or a fast fashion brand using sustainable materials but with questionable manufacturing processes. 

In the investment industry, it could be excluding obvious companies like tobacco manufacturers from a portfolio but not applying ESG analysis to the rest of it. Greater regulation and efforts to standardise measuring and reporting should help reduce the effects of greenwashing, as well as wider education. 

Investment risks

  • Invesco EUR Government and Related Green Transition Bond UCITS ETF, Invesco EUR Corporate Bond ESG Multi-Factor UCITS ETF & Invesco EUR Corporate Bond ESG Short Duration Multi-Factor UCITS ETF

    Use of derivatives for investment purposes: This fund may use derivatives for investment purposes. The use of such complex instruments may impact the magnitude and frequency of the fluctuations in the value of the fund.

    Invesco MSCI Emerging Markets ESG Climate Paris Aligned UCITS ETF, Invesco Solar Energy UCITS ETF, Invesco Wind Energy UCITS ETF, Invesco Hydrogen Economy UCITS ETF

    Emerging markets: As a large portion of this fund is invested in less developed countries, investors should be prepared to accept a higher degree of risk than for an ETF that invests only in developed markets.

    Invesco EUR Government and Related Green Transition Bond UCITS ETF, Invesco EUR Corporate Bond ESG Multi-Factor UCITS ETF, Invesco EUR Corporate Bond ESG Short Duration Multi-Factor UCITS ETF & Invesco Corporate Bond ESG UCITS ETFs

    Credit risk: The creditworthiness of the debt the Fund is exposed to may weaken and result in fluctuations in the value of the Fund. There is no guarantee the issuers of debt will repay the interest and capital on the redemption date. The risk is higher when the Fund is exposed to high yield debt securities.

    Interest rates: Changes in interest rates will result in fluctuations in the value of the fund.

    Invesco EUR Government and Related Green Transition Bond UCITS ETF, Invesco EUR Corporate Bond ESG Multi-Factor UCITS ETF, Invesco EUR Corporate Bond ESG Short Duration Multi-Factor UCITS ETF, Invesco Quantitative Strategies Global Equity Low Volatility Low Carbon UCITS ETF, Invesco Quantitative Strategies ESG Global Equity Multi-Factor UCITS ETF, Invesco MSCI ESG Climate Paris Aligned UCITS ETFs, Invesco Corporate Bond ESG UCITS ETFs, Invesco Nasdaq-100 ESG UCITS ETF, Invesco S&P 500 ESG UCITS ETF, Invesco FTSE All Share ESG Climate UCITS ETF

    Environmental, social and governance: The Fund intends to invest in securities of issuers that manage their ESG exposures better relative to their peers. This may affect the Fund’s exposure to certain issuers and cause the Fund to forego certain investment opportunities. The Fund may perform differently to other funds, including underperforming other funds that do not seek to invest in securities of issuers based on their ESG ratings.

    Invesco MSCI Emerging Markets ESG Climate Paris Aligned UCITS ETF, Invesco MSCI Europe ESG Climate Paris Aligned UCITS ETF, Invesco MSCI World ESG Climate Paris Aligned UCITS ETF, Invesco MSCI ESG Climate Paris Aligned UCITS ETFs, Invesco Quantitative Strategies ESG Global Equity Multi-Factor UCITS ETF, Invesco Quantitative Strategies Global Equity Low Volatility Low Carbon UCITS ETF, Invesco EUR Corporate Bond ESG Multi-Factor UCITS ETF, Invesco EUR Corporate Bond ESG Short Duration Multi-Factor UCITS ETF

    Currency: The Fund’s performance may be adversely affected by variations in the exchange rates between the base currency of the Fund and the currencies to which the Fund is exposed.

    Invesco EUR Government and Related Green Transition Bond UCITS ETF

    Securities lending: The Fund may be exposed to the risk of the borrower defaulting on its obligation to return the securities at the end of the loan period and of being unable to sell the collateral provided to it if the borrower defaults.

    Green Bond Risk: The Fund invests in Green Bonds which means the Fund will be more affected by the performance of Green Bonds than a fund that is more diversified across the bond market. The market for Green Bonds and related regulation is evolving. The current accepted market standard definitions of “green” may change over time and in such event, the Fund may change the definition of Green Bonds that is applied by the Fund.

    Invesco Nasdaq-100 ESG UCITS ETF, Invesco S&P 500 ESG UCITS ETF, Invesco FTSE All Share ESG Climate UCITS ETF, Invesco MSCI ESG Climate Paris Aligned UCITS ETFs, Invesco Global Clean Energy UCITS ETF, Invesco Solar Energy UCITS ETF, Invesco Wind Energy UCITS ETF, Invesco Hydrogen Economy UCITS ETF

    Equity: The value of equities and equity-related securities can be affected by a number of factors including the activities and results of the issuer and general and regional economic and market conditions. This may result in fluctuations in the value of the Fund.

    Invesco Corporate Bond ESG UCITS ETFs, Invesco S&P 500 ESG UCITS ETF, Invesco FTSE All Share ESG Climate UCITS ETF, Invesco Quantitative Strategies ESG Global Equity Multi-Factor UCITS ETF

    Concentration: The Fund might be concentrated in a specific region or sector or be exposed to a limited number of positions, which might result in greater fluctuations in the value of the Fund than for a fund that is more diversified.

    Invesco MSCI USA ESG Climate Paris Aligned UCITS ETF, Invesco MSCI Japan ESG Climate Paris Aligned UCITS ETF

    Country Concentration Risk: The Fund is invested in a particular geographical region, which might result in greater fluctuations in the value of the Fund than for a fund with a broader geographical investment mandate.

    Invesco Nasdaq-100 ESG UCITS ETF, Invesco Solar Energy UCITS ETF

    Sector concentration: As this fund has significant exposure to one or a small number of sectors, investors should be prepared to accept a higher degree of risk than for an ETF with a broader investment mandate.

    Invesco Global Clean Energy UCITS ETF, Invesco Wind Energy UCITS ETF, Invesco Hydrogen Economy UCITS ETF

    Small companies: As this fund invests primarily in small-sized companies, investors should be prepared to accept a higher degree of risk than for an ETF with a broader investment mandate.

    Invesco Wind Energy UCITS ETF, Invesco Hydrogen Economy UCITS ETF, Invesco MSCI Emerging Markets ESG Climate Paris Aligned UCITS ETF

    Stock Connect: The Fund may use Stock Connect to access China A Shares traded in Mainland China. This may result in additional liquidity risk and operational risks including settlement and default risks, regulatory risk and system failure risk.

    Invesco MSCI Emerging Markets ESG Climate Paris Aligned UCITS ETF

    Sampling Risk: The use of a representative sampling approach will result in the Fund holding a smaller number of securities than are in the underlying index. As a result, an adverse development to an issuer of securities that the Fund holds could result in a greater decline in NAV than would be the case if the Fund held all of the securities in the underlying index.

    Liquidity Risk: It may be difficult for the Fund to buy or sell certain instruments in stressed market conditions. Consequently, the price obtained when selling such instruments may be lower than under normal market conditions.

    Invesco S&P 500 ESG UCITS ETF

    Synthetic ETF Risk: The fund might purchase securities that are not contained in the reference index and will enter into swap agreements to exchange the performance of those securities for the performance of the reference index.

    Use of derivatives for index tracking: The Fund’s ability to track the benchmark’s performance is reliant on the counterparties to continuously deliver the performance of the benchmark in line with the swap agreements and would also be affected by any spread between the pricing of the swaps and the pricing of the benchmark. The insolvency of any institutions providing services such as safekeeping of assets or acting as counterparty to derivatives or other instruments, may expose the Fund to financial loss.

    Invesco Nasdaq-100 ESG UCITS ETF

    Single country: As this fund invests in companies from a single country, investors should be prepared to accept a higher degree of risk than an ETF that is geographically diversified.

    Invesco Global Clean Energy UCITS ETF, Invesco Solar Energy UCITS ETF, Invesco Wind Energy UCITS ETF, Invesco Hydrogen Economy UCITS ETF

    Clean Energy: Investments into the clean energy sector are considerably exposed to investment trends focused on environmental factors and may have sensitivities towards ESG related government regulations and tax implications.

    Invesco Solar Energy UCITS ETF

    Holdings concentration: The Fund might be exposed to a limited number of positions which might result in greater fluctuations in the value of the Fund than for a fund that is more diversified.

Important information

  • Date as at 30 June 2023 unless otherwise stated.

    Costs may increase or decrease as result of currency and exchange rate fluctuations. Consult the legal documents for further information on costs.

    For more information on our funds and the relevant risks, please refer to the share class-specific Key Information Documents/Key Investor InformatiDate as at 31 March 2024 unless otherwise stated.

    Costs may increase or decrease as result of currency and exchange rate fluctuations. Consult the legal documents for further information on costs.

    For information on our funds and the relevant risks, refer to the Key Information Documents/Key Investor Information Documents (local languages) and Prospectus (English, French, German), and the financial reports, available from www.invesco.eu. A summary of investor rights is available in English from www.invescomanagementcompany.ie. The management company may terminate marketing arrangements

    This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.

    UCITS ETF’s units/shares purchased on the secondary market cannot usually be sold directly back to UCITS ETF. Investors must buy and sell units/shares on a secondary market with the assistance of an intermediary (e.g. a stockbroker) and may incur fees for doing so. In addition, investors may pay more than the current net asset value when buying units/shares and may receive less than the current net asset value when selling them.

    Views and opinions are based on current market conditions and are subject to change For the full objectives and investment policy please consult the current prospectus.

    German investors may obtain the offering documents free of charge in paper or electronic form from the issuer or from the German information and paying agent (Marcard, Stein & Co AG, Ballindamm 36, 20095 Hamburg, Germany).

    In Israel, the contents of this document are restricted to Qualified Clients (pursuant to the First Schedule to the Israeli Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, 1995) only and are not intended for retail or private investors who are not Qualified Clients.

    The publication of the supplement in Italy does not imply any judgment by CONSOB on an investment in a product. The list of products listed in Italy, and the offering documents for and the supplement of each product are available: (i) at etf.invesco.com (along with the audited annual report and the unaudited half-year reports); and (ii) on the website of the Italian Stock Exchange borsaitaliana.it. 

    The representative and paying agent in Switzerland is BNP PARIBAS, Paris, Zurich Branch, Selnaustrasse 16 8002 Zürich. The Prospectus, Key Information Document, and financial reports may be obtained free of charge from the Representative. The ETFs are domiciled in Ireland.