Invesco ESG Loan Investment Process Overview

Invesco’s ESG approach to senior loans
At Invesco, we manage roughly USD 38.6 bn1 in senior secured bank loans for institutional, retail, and high net worth clients globally. Senior loans are an alternative asset class – they are privately arranged debt instruments (usually below investment grade). Investors look to add bank loans to their asset allocation strategies because they provide appealing returns through various economic cycles – they are senior in the capital structure, secured by all assets of the company, and they provide stable current income floating with prevailing interest rates. However, loans are not a security. Each loan has unique characteristics tailored to the underlying corporate issuer. Often senior secured loan issuers are private companies or may be sponsored by a private equity firm with no publicly available information.
In 2015, Invesco Senior Secured Management, Inc. (ISSM) began to formally incorporate ESG considerations into its investment process as part of its consideration of credit risks for each issuer. However, investors began seeking more quantifiable approaches to better understand Invesco’s ESG considerations. Even more importantly, investors are expecting their bank loan managers to actively engage with management with respect to their ESG journey. ISSM’s proprietary ESG process provides investors with a rigorous multi-pronged approach to ESG.
Download our Investment Process Overview below to learn more.
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Important information
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This document has been prepared only for those persons to whom Invesco has provided it. It should not be relied upon by anyone else. Information contained in this document may not have been prepared or tailored for an Australian audience and does not constitute an offer of a financial product in Australia. You may only reproduce, circulate and use this document (or any part of it) with the consent of Invesco.
The information in this document has been prepared without taking into account any investor’s investment objectives, financial situation or particular needs. Before acting on the information the investor should consider its appropriateness having regard to their investment objectives, financial situation and needs.
You should note that this information:
- may contain references to dollar amounts which are not Australian dollars;
- may contain financial information which is not prepared in accordance with Australian law or practices;
- may not address risks associated with investment in foreign currency denominated investments; and
- does not address Australian tax issues.
While any Invesco fund referred in this page may consider Environmental, Social and Governance (ESG) aspects to better manage risks and improve returns, it is not bound by any specific ESG criteria. The fund may invest across the ESG spectrum and will not necessarily exclude companies with controversial business areas – such as those with significant revenues from coal, fossil fuel, nuclear power, weapons and tobacco – from the investable universe. Information used to evaluate ESG factors may not be readily available, complete or accurate. ESG factors may vary across types of investments and issuers, and not every ESG factor may be identified or evaluated. There is no guarantee that the evaluation of ESG considerations will be additive to the fund’s performance.
Issued in Australia by Invesco Australia Limited (ABN 48 001 693 232), Level 26, 333 Collins Street, Melbourne, Victoria, 3000, Australia which holds an Australian Financial Services Licence number 239916.
- may contain references to dollar amounts which are not Australian dollars;