A bit more on what is happening in the world of anti-ESG – BlackRock was targeted by the movement last year, including being banned by Texas for state investments and taken to court by Tennessee. BlackRock has now officially acknowledged the risk to its business dealings from Anti-ESG sentiment by including increased scrutiny of ESG as a key risk factor in its quarterly results. Responsible Investor ran a piece on the report which states that:
“In an earnings release published on Friday the firm warned that ‘increasing focus from stakeholders regarding ESG matters’ could impact its future performance. The warning joins a series of 28 other factors that the investor chose to highlight to investors as potentially having a material impact, including potential broader threats such as geopolitical unrest, and several relating to BlackRock’s blockbuster acquisition of Global Infrastructure Partners.”
The article notes that risks associated with climate change have appeared in BlackRock’s quarterly reports since 2022. There’s no denying that it’s tough to be BlackRock in the current ESG climate. As the article points out, the New York City Comptroller floated the idea of divesting pension money from the firm alleging that it isn’t doing enough on climate issues – effectively the opposite of what Texas and Tennessee claim.
Being the world’s largest asset manager puts a target on their back for various causes and the high-profile nature of the firm makes it something of a political Rorschach test. Anti-ESG proponents look at BlackRock as a firm pushing a “woke” agenda on society. Pro-ESG advocates see a corporate giant moving too slowly to adequately address climate issues. The company’s annual 10-K will be interesting reading on how the company is walking the tightrope.
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