BlackRock Admits ESG Investments Pose Business Risk as Republican AGs Ramp Up Scrutiny

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NATIONAL REVIEW

BlackRock Admits ESG Investments Pose Business Risk as Republican AGs Ramp Up Scrutiny
By James Lynch
March 4, 2024

BlackRock identified its Environmental, Social and Governance (ESG) investment strategy as a risk facing the company, due in part to the increasing political scrutiny surrounding the practice, in a year-end 2023 filing with the Securities and Exchange Commission.
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Republicans in Congress and red states have in recent years launched investigations into BlackRock’s ESG activity and membership in environmental investment coalitions. House Judiciary Committee Chairman Jim Jordan subpoenaed BlackRock last year for records related to its ESG policies for his investigation into the possibility of antitrust violations surrounding left-wing climate initiatives.
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Montana Attorney General Austin Knudsen (R) is leading a coalition of over a dozen GOP attorneys general pressing BlackRock on its ESG investments and whether they violate its fiduciary duty. The attorneys general wrote a letter to BlackRock on February 27th voicing concerns about BlackRock’s public statements about ESG and potential conflicts of interest with mutual-fund directors.

“BlackRock’s investors deserve answers about the firm’s Environmental, Social, and Governance investments and potential conflicts of interest with fund directors,” Knudsen said in a statement to NR.

“After pressure from me and attorneys general across the country, BlackRock withdrew from one investment group pushing ESG. However, I still have serious concerns that the firm is not focused on their job, which is to make money for their shareholders, and instead is focused on furthering the left’s woke policies.”

In February, BlackRock pulled out of Climate Action 100+, an investment coalition overseeing $68 trillion worth of assets, and delegated membership to a smaller corporate subsidiary. J.P. Morgan Asset Management and State Street Global Advisors fully withdrew from the climate alliance, both companies previously told NR.

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FOX BUSINESS

JPMorgan Chase, BlackRock drop out of massive UN climate alliance in stunning move
By Thomas Catenacci
February 15, 2024

JPMorgan Chase and institutional investors BlackRock and State Street Global Advisors (SSGA) on Thursday announced that they are quitting or, in the case of BlackRock, substantially scaling back involvement in a massive United Nations climate alliance formed to combat global warming through corporate sustainability agreements.

In a statement, the New York-based JPMorgan Chase explained that it would exit the so-called Climate Action 100+ investor group because of the expansion of its in-house sustainability team and the establishment of its climate risk framework in recent years. BlackRock and State Street, which both manage trillions of dollars in assets, said the alliance's climate initiatives had gone too far, expressing concern about potential legal issues as well.

The stunning announcements come as the largest financial institutions in the U.S. and worldwide face an onslaught of pressure from consumer advocates and Republican states over their environmental, social and governance (ESG) priorities.

"The firm has built a team of 40 dedicated sustainable investing professionals, including investment stewardship specialists who also leverage one of the largest buy side research teams in the industry," the bank said in a statement shared with FOX Business. "Given these strengths and the evolution of its own stewardship capabilities, JPMAM (JP Morgan Asset Management) has determined that it will no longer participate in Climate Action 100+ engagements."
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In June, House Judiciary Chairman Jim Jordan, R-Ohio, issued a subpoena to Ceres, a nonprofit advocacy organization that helps to oversee Climate Action 100+, alleging the group may be facilitating collusion through its climate-focused initiatives in violation of U.S. antitrust law.
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"JPMorgan, State Street, and BlackRock's departure is a necessary step in the right direction, but consumers should wait to trust these companies again," said Consumers Research executive director Will Hild. "By leaving the Climate Action 100+ climate cartel, they are signaling that the actions of millions of consumers and dozens of elected officials are having an effect."

"These asset management firms are clearly afraid of the bad press and legal actions taken against their destructive net zero push," Hild added.

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