The Invesco Environmental Focus Municipal Fund was honoured for its long-standing role in leveraging the sustainable investment opportunities in the US municipal bond market.

For Invesco, the muni bond market is a "natural fit" for sustainable investment as muni issuers – in particular, state and local governments – have been focused on reducing carbon emissions for years. For example, 11 US states have been involved in the Regional Greenhouse Gas Initiative (RGGI) 'cap-and-trade' carbon market to incentivise the power sector to decarbonise.

The $85 million fund applies a three-pronged approach to assess inclusion in the fund, focused on the issuer's activities, how it is funded, and what it plans to use the bond proceeds to finance.

Applying this method, the fund has delivered robust returns. It has outperformed its benchmark – the S&P Municipal Bond 5+ Year Investment Grade Index – in six of the last 10 years, including by 180 basis points in 2024.

The $1.8 trillion asset manager believes sustainable muni bond opportunity will continue to grow.

"We expect more municipal issuers to follow suit, especially given the severe impact of natural disasters on so many US cities and states in recent years."