The SEC has been paying close attention to regulated firms’ claims about their incorporation of environmental, social and governance (ESG) factors in the investment process. Given the relative infancy of ESG investing and the rush by advisers to climb aboard the ESG bandwagon, the area is fraught with inconsistent data and a lack of uniform definitions or standards. Nevertheless, the well-worn adage that advisers must say what they do and do what they say is applicable to the ESG arena. The seven-figure fine that the SEC recently imposed on an investment adviser confirms that the SEC will not give advisers any leeway on their ESG claims. The adviser’s prospectuses and investor communications with respect to certain funds allegedly gave the false impression that the funds performed an ESG quality review of every fund investment. This article details the adviser’s alleged misrepresentations and the terms of the settlement, with commentary from William Chignell, chief commercial officer, ESG ratings & advisory, at Apex Group. See our two-part coverage of the SEC’s proposed climate risk disclosure rules: “Five Key Elements” (May 19, 2022); and “Implications, Challenges, Timing and Pushback” (May 26, 2022); as well as “SEC Compliance and Enforcement Expectations for Private Funds Under Chair Gensler” (Oct. 7, 2021); and “Former SEC Enforcement Director Discusses Fund Manager Risks and Enforcement’s Priorities (Part Two of Two)” (Oct. 7, 2021).