Oct 7, 2022 - Economy

BlackRock defends its ESG position amid Republican criticism

Illustration of an open briefcase with a small plant growing out of it

Illustration: Sarah Grillo/Axios

Investment giant BlackRock defended its environmental, social and governance position Friday with a dedicated website outlining its strategy amid ongoing attacks from Texas officials and Republican lawmakers.

Why it matters: The asset manager is continuing to throw its weight behind ESG assets while also preparing for the possibility of its detractors gaining majorities in the Senate and House in the midterms.

Context: Texas officials banned state entities from doing business with BlackRock and other firms the state had identified as "boycotting" oil and gas investments.

What they're saying: "We’re setting the record straight about our focus on energy investing, our responsibilities to clients and how we consider climate risk," the site states.

  • "Our consideration of the risks and opportunities of a transition to a low-carbon economy is in the interest of realizing the best long-term financial results for our clients and entirely consistent with our fiduciary duty," it continues.

State of play: BlackRock publicly shot back at the criticisms last month and has doubled down on its impact investing with a slate of key hires over the past 18 months.

  • The asset manager hired former Wells Fargo executive Nate Hurst as chief sustainability and social impact officer in July, and on October 3 elevated Mark McCombe — the firm's point person on the Texas fight — to vice chairman focusing on stakeholder engagement, effective at the start 2023.

Quick take: ESG investing is a likely target of inquiries should Republicans gain control of Congress, and BlackRock is attempting to get ahead of it by fortifying its reputation and team.

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