BlackRock Inc. is the world’s largest investment company. It has also been the leader in ESG (environmental, social, governance) investing–i.e., prioritizing a left-wing agenda over shareholder returns. It seems, finally, that BlackRock’s political agenda is dragging the company down:
Brennan Hawken, an analyst at [UBS], downgraded the stock of BlackRock (NYSE: BLK) to Neutral from Buy and slashed the stock price target to $585 from $700 over growing pushback to its ESG efforts.
“We are downgrading BLK to Neutral based on environmental pressure to earnings and risk from the firm’s ESG positioning,” Hawken wrote in a note, stating that BlackRock could face increased regulatory inspection and the possibility of diminished fund management business.
Not surprisingly, many investors don’t want to see their returns sacrificed to a political agenda. But the leaders in pushing back against BlackRock have been government pension plans:
Recently, Louisiana Treasurer John Schroder wrote a letter (pdf) to Fink, explaining that the state would liquidate approximately $800 million from the financial institution’s exchange-traded funds (ETFs), money market funds, and mutual funds within three months. Schroder cited BlackRock’s ESG standards that promote green energy over conventional fossil fuels.
“Your blatantly anti-fossil fuel policies would destroy Louisiana’s economy,” Schroder wrote.
Other states, too, have divested BlackRock holdings. Still others have issued a warning:
In August, Texas and 18 other states penned a letter to [BlackRock CEO Larry] Fink, threatening to remove state funds from these banks over BlackRock’s ESG objectives.
“Our states will not idly stand for our pensioners’ retirements to be sacrificed for BlackRock’s climate agenda. The time has come for BlackRock to come clean on whether it actually values our states’ most valuable stakeholders, our current and future retirees, or risk losses even more significant than those caused by BlackRock’s quixotic climate agenda,” the letter reads.
The ESG fad is one aspect of leftism’s infiltration of the upper tiers of corporate America. Let’s hope it can be squashed.