Over the past few months, more than a dozen attorneys general from throughout the nation have raised legitimate concerns about BlackRock’s crony capitalist investment scheme known as environmental, social, and governance (ESG) metrics.
In fact, on August 4, 19 attorneys general signed a coalition letter stating, “BlackRock appears to use the hard-earned money of our states’ citizens to circumvent the best possible return on investment, as well as their vote. BlackRock’s past public commitments indicate that it has used citizens’ assets to pressure companies to comply with international agreements such as the Paris Agreement that force the phase-out of fossil fuels, increase energy prices, drive inflation, and weaken the national security of the United States. These agreements have never been ratified by the United States Senate. The Senators elected by the citizens of this country determine which international agreements have the force of law, not BlackRock.”
The letter, addressed to BlackRock CEO Larry Fink, also notes that:
- “BlackRock has already committed to accelerate net zero emissions across all of its assets, regardless of client wishes,”
- “BlackRock’s commitment to, and execution of, an escalation and voting policy is designed to use the leverage of the financial sector to change behavior,”
- “BlackRock has chosen to lead detailed, comprehensive efforts to retire fossil fuels,”
- “BlackRock joined groups so focused on promoting the Paris Agreement that they want to stifle opposing viewpoints altogether,”
- “BlackRock’s belief that the world will require net zero by 2050 could be a pretext to force companies to adopt your preferred climate policies,”
- “BlackRock voted to penalize the board of directors for a European utility, Fortum, for investing in coal,”
- “BlackRock’s coordinated conduct with other financial institutions to impose net-zero also raises antitrust concerns,”
- “BlackRock’s actions appear to intentionally restrain and harm the competitiveness of the energy markets,”
- “BlackRock has an obligation to act in the sole financial interest of its clients,”
- “BlackRock’s alignment of engagement priorities with environmental and social goals, such as the UN’s Sustainable Development Goals, suggests at a minimum a mixed motive,”
- “BlackRock’s actions on a variety of governance objectives may violate multiple state laws,”
- “BlackRock has a private motivation that differs from its public commitments and statements,”
Make no mistake, BlackRock is no ordinary investment firm. BlackRock, which holds more than $10 trillion in assets, is the largest financial firm in the world. In other words, BlackRock holds great sway over the global economy due to its mammoth asset portfolio. This being the case, it is quite concerning that BlackRock is so gung-ho when it comes to ESG investing, which asserts that the interests of “stakeholders,” not “shareholders,” should come first and foremost. Moreover, ESG metrics are arbitrary, subject to change at any moment, and do not emphasize rewarding companies that produce goods and services based on consumer demand. Instead, ESG metrics seek to reward “woke” companies that toe the line when it comes to climate change, diversity, and other progressive objectives. In essence, ESG allows Big Government, Big Business, and Big Finance to steer the economy in the direction they desire. This is not free-market capitalism, it is the epitome of crony capitalism.
Finally, more than a month later, BlackRock has responded to the attorneys general with a mealy-mouthed letter in which it desperately tries (futilely, I might add) to defend its ESG investment scheme.
According to BlackRock:
- “Your letter makes several inaccurate statements about BlackRock’s motive for participating in various ESG-related initiatives. In managing our clients’ assets, BlackRock seeks to realize the best long-term financial results consistent with each client’s investment guidelines. Our participation in these initiatives is entirely consistent with our fiduciary obligations.”
- “Governments representing over 90% of global GDP have committed to move to net-zero in the coming decades. We believe 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.”
- “Climate risk and the economic opportunities from the energy transition have
become a top concern for many of our clients. BlackRock clients representing more than $3.3 trillion in assets have committed to support that transition through investments in their portfolios.”
- “As the recent historic floods across the country as well as the droughts and wildfires throughout the West and around the world this past year have shown, climate change is testing the resilience of many industries and businesses.”
- “BlackRock’s belief that climate risk poses investment risk is backed by our publicly-available research. This research reflects that, even with short term shocks to the energy sector (including shocks due to the war in Ukraine), the longer-term shift towards a less carbon-intensive economy is likely to continue.”
Allow me translate that into plain language: Your overlords at BlackRock have determined that the peasants are incapable of comprehending the existential threat of climate change. Therefore, we deem it necessary that you put all your trust (and retirement savings) in our ability to determine the direction the global economy should take over the next decades. And, if you dare question our decisions on these matters, you are a “climate change denier” who does not care about the future of humanity and our planet.
In reality, BlackRock and the other large investment institutions (Fidelity and State Street) are using ESG as a vehicle to increase their power and wealth. They are not genuinely concerned about the environment, social justice, or DEI initiatives. On the contrary, BlackRock executives, and Wall Street at large, live lavishly, spewing more carbon dioxide emissions during one hour on their private jets than the average household does over three months!
In the coming years, those who support free-market capitalism, personal freedom, and national sovereignty must continue to fight against the implementation of ESG metrics. It will be a difficult battle, but it is a worthy fight, and it must be won in the name of liberty.
PHOTO: BlackRock Defund Line 3 march NYC HQ. Photo by Stop the Money Pipeline. Public Domain Mark 1.0.
Chris Talgo ([email protected]) is an editor and research fellow at The Heartland Institute and a researcher and editor at StoppingSocialism.com.