The fight over woke ESG — environmental, social and governance — policies being used by massive asset managers to make investment decisions entered new territory on Wednesday, thanks to Mississippi Secretary of State Michael Watson.
In a first-of-its-kind move, Watson and his office’s Securities Division issued a cease and desist order and notice of intent to impose an administrative penalty “to stop BlackRock from inflicting immediate and irreparable public harm” on Mississippi’s residents.
It alleges that BlackRock, the world’s largest asset manager noted for its commitments to advance ESG standards, has been and is making “untrue statements of material fact” as well as “omit[ting] material facts to make its statements not misleading” to Mississippians about its “investment services, especially its involvement in pushing [ESG] factors on portfolio companies.” The cease and desist also states that “many of BlackRock’s acts, practices, and courses of business operate or would operate as a fraud or deceit upon investors and potential investors in Mississippi.”
These “untrue and misleading” claims, the cease and desist says, fall into two main categories. The first is BlackRock’s marketing of “non-ESG funds” which Watson says is “misleading to investors who are not interested in ESG and are led to believe that BlackRock’s non-ESG funds will be managed for the sole purpose of investors’ financial return without regard to ESG criteria.” However, Watson says, that’s not true “because BlackRock has committed to use all assets under management to advance the environmental agenda of reducing carbon emissions to ‘net zero.'”
See full article from Townhall.com.
Photo by Alpha Photo, CC BY-NC 2.0 DEED.
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