Florida targets BlackRock in anti-ESG assault

Here’s a note from Tim Quinson of Bloomberg Green:

Florida Governor Ron DeSantis is making it clear that he either doesn’t like BlackRock Inc. or thinks pillorying the Wall Street giant as “woke” is good politics with 2024 approaching. The Republican’s administration is pulling $2 billion from the world’s largest investment firm and is pushing managers who run the state’s pension funds to withdraw their holdings—some $13 billion. Why? Mainly because of the New York-based company’s loudly professed ties to environmental, social and governance investment principles. DeSantis’s main complaint: ESG investing “sacrifices returns at the altar of the select few, unelected corporate elites and their radical woke agendas.”

BlackRock—despite continuing to be one of the biggest financiers of the fossil-fuel industry—has become Florida’s top target. In a statement announcing the state’s decision to divest from the firm, Florida Chief Financial Officer Jimmy Patronis said: “I need partners within the financial services industry who are as committed to the bottom line as we are—and I don’t trust BlackRock’s ability to deliver.”
He also singled out Larry Fink, saying BlackRock’s chief executive officer is “on a campaign to change the world” by championing “stakeholder capitalism” and ESG. But while Fink has spent the past few years singing the praises of ESG, he’s been regularly accused of allowing BlackRock to profit from investing in unsustainable industries.

Since the summer, BlackRock has put out a series of statements in response to the GOP’s onslaught. In early September, the firm defended its statements claiming to back sustainable investing when it told 19 Republican state attorneys general that the climate crisis is a top concern for its clients and a key risk to consider in financial decisions.

“Investors and companies that take a forward-looking position with respect to climate risk and its implications for the energy transition will generate better long-term financial outcomes,” Dalia Blass, BlackRock’s head of external affairs, wrote in the letter. “These opportunities cut across the political spectrum.”