The financial giant that many say will soon own the home of the average American is under scrutiny by the Attorney Generals (AGs) of 15 red states. BlackRock’s first responsibility by law is the fiduciary duty to their clients, but their emphasis on Environmental, Social and Governance (ESG) programs has drawn the attention of Republican prosecutors.
Withdrawing from Climate Action 100+ was a step in the right direction.
AG @SeanReyesUT and a coalition of states are remaining steadfast in holding BlackRock and others like it accountable by protecting the financial freedom of their constituents.https://t.co/enFtOQlvvZ
— Utah Attorney General (@UtahAG) March 1, 2024
With $10 trillion in assets, this multinational investment firm has been scrutinized over its emphasis on left-wing politics rather than maximizing profit. Specifically, BlackRock has a great deal of investment in activist “climate change” funds.
A 16-page letter signed by the 15 GOP AGs expresses concern that funds such as Net Zero Asset Managers initiative, the United Nations Principles for Responsible Investment, and Ceres constitute woke activism, not sound investment. BlackRock has money in all these organizations.
ESG funds typically underperform yet charge higher fees than non-ESG counterparts.
The letter states: “BlackRock has made commitments to environmental activist groups that may conflict with the fiduciary duties it owes to clients, and we seek more information about how the independent directors have overseen this.”
The Republican AGs signing the letter include those from Montana, Alabama, Arkansas, Georgia, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nebraska, South Carolina, South Dakota, Texas, Virginia, West Virginia and Utah.
They need to look no further than BlackRock’s own annual 10-K filing with the Securities and Exchange Commission (SEC). It acknowledges that ESG investments may not exactly be profit machines: “Matters subject to scrutiny, such as ESG, may be viewed differently by various stakeholders and adversely impact BlackRock’s reputation and business, including through redemptions or terminations by clients, and legal and governmental action and scrutiny.”
States such as Florida and Texas have pulled money from BlackRock over “woke” investment concerns.
Environment and climate change “investments” are hardly the only areas in which BlackRock leverages its clout to push leftist agendas.
BlackRock has been at the forefront of culture wars in recent years due to its increasing perception of being the “man behind the curtain” of woke entertainment. They are a significant shareholder in Disney, which relies on BlackRock for short-term loans to fund day-to-day operations. This liquidity is available only on condition that Disney maintains sufficient ESG scores.
Many feel BlackRock’s activist-driven leverage explains why Disney continues to produce “woke” films that lose money.
