The New York headquarters of the BlackRock investment management firm on Friday, Feb. 5, 2016. Photo: Richard Levine/Corbis via Getty Images

U.S. investment firm BlackRock owns more coal reserves through its investments in publicly listed companies, shares and bonds in coal plant developers than anyone else in the world, according two new pieces of analysis.

The big picture: The U.S. holds over 35% of institutional investment for the coal industry, the largest share in the world. And in recent years, U.S. investors have started to lag behind leading European institutions when it comes to climate-friendly investing: AXA, UBS and c all have policies in place to restrict investments in thermal coal and offer far less coal-intense index funds.

Details: With a collective $40 trillion in assets under management (AUM), the world's 15 largest asset managers have all increased their holdings in thermal coal by 20% since the Paris Agreement was signed. BlackRock alone holds shares and bonds totaling $11 billion in 56 coal plant developers around the world, with Vanguard in second at $6.2 billion.

InfluenceMap has also analyzed the thermal coal intensity (TCI) — measured in tons of thermal coal per million dollars in AUM — of the 60,000 largest listed funds. 

  • BlackRock was 50% more "coal heavy" than the average.
  • Allianz’s funds, on the other hand, including those of its U.S. arms, show TCI values of roughly 80% less than the global fund benchmark, likely indicating a strategic underweighting of companies with thermal coal businesses since the Paris Agreement.

What's next: Reducing exposure to thermal coal looks increasingly like the right business move for investors. Of existing coal plants around the world, 42% are losing money, and 1 in 4 tons of coal in the U.S. is sold to plants that have already committed to retiring. Meanwhile, new renewable energy is now cheaper than existing coal, which will hasten these retirements.

What to watch: In addition to the financial risks posed by a contracting market, companies may start to worry even more about the reputational risks of investing in coal. Asset managers such as BlackRock are responsible for trillions in investments, rendering their coal holdings relatively trivial. That means the coal industry needs BlackRock, but BlackRock may not need, or want, the cost of doing business with the coal industry.

Justin Guay directs global climate strategy at the Sunrise Project and advises the ClimateWorks Foundation.

Go deeper

41 mins ago - Podcasts

Facebook boycott organizers share details on their Zuckerberg meeting

Facebook is in the midst of the largest ad boycott in its history, with nearly 1,000 brands having stopped paid advertising in July because they feel Facebook hasn't done enough to remove hate speech from its namesake app and Instagram.

Axios Re:Cap spoke with the boycott's four main organizers, who met on Tuesday with CEO Mark Zuckerberg and other top Facebook executives, to learn why they organized the boycott, what they took from the meeting, and what comes next.

Boycott organizers slam Facebook following tense virtual meeting

Illustration: Sarah Grillo/Axios

Civil rights leaders blasted Facebook's top executives shortly after speaking with them on Tuesday, saying that the tech giant's leaders "failed to meet the moment" and were "more interested in having a dialogue than producing outcomes."

Why it matters: The likely fallout from the meeting is that the growing boycott of Facebook's advertising platform, which has reached nearly 1000 companies in less than a month, will extend longer than previously anticipated, deepening Facebook's public relations nightmare.

Steve Scalise PAC invites donors to fundraiser at Disney World

Photo: Kevin Lamarque-Pool/Getty Images

House Minority Whip Steve Scalise’s PAC is inviting lobbyists to attend a four-day “Summer Meeting” at Disney World's Polynesian Village in Florida, all but daring donors to swallow their concern about coronavirus and contribute $10,000 to his leadership PAC.

Why it matters: Scalise appears to be the first House lawmakers to host an in-person destination fundraiser since the severity of pandemic became clear. The invite for the “Summer Meeting” for the Scalise Leadership Fund, obtained by Axios, makes no mention of COVID-19.