Investment giant BlackRock has set up a new website, titled “Energy investing: Setting the record straight,” aimed at responding to growing claims accusing the firm of “boycotting” oil and gas companies in pursuit of an ESG-focused social agenda.
The publication of the new site follows a growing anti-ESG push by Republican politicians in the U.S., which has recently culminated in actions such as Florida passing a resolution to no longer allow ESG considerations to be used by fund managers for its $228 billion of pension funds, Texas publishing a list of fund managers – including BlackRock, Credit Suisse, UBS and several others – slated for potential divestment from its pension funds, due to their strong ESG credentials and support for net zero investing and advocacy, and Louisiana announcing a planned divestment from BlackRock funds of nearly $800 million in order to “protect” the state’s Treasury funds “from ESG.”
BlackRock, as the largest global investment management company, and a leading voice in the investment community on climate change and energy transition-related themes, has found itself at the center of many of these efforts. In August, 19 Attorneys General signed a letter accusing BlackRock of acting with “mixed motives” in its pursuit of an anti-fossil fuel and pro-net zero agenda for following a “social purpose” not aligned with a focus on financial returns.
Many of the explanations provided on BlackRock’s new site reflect BlackRock’s official response to the Attorneys’ General claims, with a letter by Head of External Affairs Dalia Blass, hitting back at “misconceptions” raised about the firm, as well as what it called “several inaccurate statements” in the letter relating to the investor’s motivations for participating in ESG initiatives.
As in Blass’ letter, the website warns that the anti-ESG movements may ultimately work against investors’ financial interests. On the website, BlackRock says:
“Our take: We believe that restricting investment choices is bad for workers and retirees
“Recently, a number of initiatives have restricted access to certain asset managers and funds. Limiting Americans’ ability to choose their investments jeopardizes their ability to meet financial goals such as retirement.”
The website addresses several of the anti-ESG politicians’ claims, most prominently stating that “We DO NOT boycott the energy industry,” and pointing out that the firm has invested $170 billion on behalf of clients in energy companies in the U.S., including pipelines and power generation facilities.
The site explains the firm’s focus on climate risk and energy as part of its efforts to drive financial outcomes for clients, by providing them with insights on global economic trends that can impact their investments. BlackRock said:
“Our consideration of the risks and opportunities of a transition to a low-carbon economy is in the interest of realizing the best long-term financial results for our clients and entirely consistent with our fiduciary duty.”
The firm also uses the site to counter claims that its participation in industry groups such as the Net Zero Asset Managers initiative and GFZANZ are driving its proxy voting activities to force companies to align with the Paris Agreement or push for specific climate actions. The site states that the firm has “not made commitments or pledges to meet environmental standards that constrain our ability to invest our clients’ money on their behalf consistent with their objectives,” adding:
“Similarly, BlackRock does not make any commitment or pledge that would interfere with our independent determination on how to engage with issuers and vote proxies in the best long-term economic interest of our clients. This includes in relation to any shareholder proposals filed or supported by Climate Action 100+ or any of its members, and BlackRock explicitly stated as much when joining the initiative.”
Click here to access BlackRock’s energy investing site.