Compliance
Legal, risk and regulatory compliance
Our ethical conduct and compliance policies, standards and procedures are reinforced by Invesco’s overarching risk management framework. The risk framework structures investment and business risk management, with particular focus on key risk areas: strategy and governance, investments, clients, people, operations and financial.
Invesco’s Board of Directors has principal responsibility for oversight of the company’s risk management processes, including those set forth in the risk management framework, and for understanding the overall risk profile of the company.
Given the pandemic in 2020, resulting in most of Invesco’s employees working from home, regulators as well as clients increased their scrutiny of conduct rules surveillance performed by investment firms. This focused particularly on market abuse and insider trading controls.
Generally, in 2020, clients continued to integrate ethical standards as a key component of the analysis of the quality of an asset manager. The due diligence carried out is focused on the controls put in place, but also on the trend observed in terms of compliance with ethical standards and policies reflected in the number of violations reported, notably around personal transactions.
Our global procurement model focuses on fulfilling the following five categories of services:
- Business services (day-to-day operations)
- Professional services (consulting, legal advisors, auditing)
- Real estate (office leases)
- Information technology and data
- Travel (hotels, airlines, etc.)
Risk assessments
We conduct periodic Anti-Bribery and Corruption (ABC) risk assessments that cover all business lines and regions globally. Our assurance functions undertake control effectiveness testing through a risk-based approach. After assessing our business for risks related to corruption in 2020, we noted some areas of inherent higher risk, but no material, confirmed cases of corruption or policy breaches were identified.
Compliance checks and balances
Our compliance team regularly reviews, records and updates an assessment of key regulatory risks to determine ongoing areas of focus. Compliance policies and procedures are subject to ongoing monitoring and periodic testing; the results of which are reviewed, escalated and remediated to further mitigate risk and/or control weaknesses. Exceptions and errors noted during the normal course of business, as well as periodic regulatory interactions, contribute to the overall view of effectiveness. The firm’s Internal Audit group also conducts regular reviews of compliance activities as part of its independent testing procedures.
Political activities
We encourage employees and other employees of Invesco and its subsidiaries, as private citizens, to exercise their rights and duties in any political or civic process. This includes voting in elections or making contributions supporting candidates or parties of their choice.
However, as a corporate policy, Invesco does not give direct payments to political activities in the U.S. As outlined in our Code of Conduct, no covered person may, under any circumstances, use company funds to make political contributions, nor are they allowed to represent their personal political views as being those of the company.
While we do not give direct payments to political activities in the U.S., we do support political activities through our Political Action Committee (PAC). For Invesco’s PAC details, see reporting available on the Federal Election Commission website at www.fec.gov. Invesco’s lobbying disclosure reports are also available through the United States Lobbying Disclosure Act database.
Responsible sourcing and procurement
We consider our procurement relationships and seek to partner with high-quality vendors who share our values and commitment to client service and responsible business practices. This effort is led by our Global Procurement Department, which is charged with promoting fair and ethical business practices in selecting vendors, mitigating risk, negotiating commercial transactions and delivering value to Invesco and our clients. Our Global Procurement Policy also outlines our responsible sourcing and procurement practices and expectations for our vendors.
To ensure that we are procuring the best vendors for business needs, our Global Procurement Department team partners with Invesco’s business units to execute their respective strategies. Together, the procurement team and business unit make recommendations for selecting a vendor based on capability, quality, price, reliability, risk and other applicable criteria, including the vendor’s adherence to Invesco’s standard contract terms and conditions, which obligate our vendors to comply with all applicable country, regional and local laws, rules and regulations, including, but not limited to, laws prohibiting bribery, slavery and human trafficking.
In addition, all procurement personnel are required to abide by Invesco’s Code of Conduct and Procurement Code of Ethics and conduct themselves in a manner that avoids the appearance of impropriety, conflicts of interest or issues of influence when interacting with vendors.