BlackRock Chief Executive Officer Larry Fink, whose firm has attempted to foist environmental, social, and corporate governance (ESG) standards on the global business community, has stopped using the term, whining it has become too politicized.
BlackRock CEO Larry Fink is reportedly “ashamed” by the environment, social and governance (ESG) investment criteria debate and argued the term was being “misused by the far left and far right.””I’m ashamed of being part of this conversation,” Fink said, according to Axios.Fink admitted during a conversation with the outlet at the Aspen Ideas Festival on Sunday that Florida Gov. Ron DeSantis’ decision to pull $2 billion in assets from Blackrock in 2022 hurt his firm.”When I write these [investment] letters, it was never meant to be a political statement. … They were written to identify longterm issues to our longterm investors,” he said on Sunday.
In fact, the press is laying the blame thick on Republicans, in general, for the Bud-Lite level of popularity ESG is now experiencing.
Republican politicians have attacked ESG as a way for the corporate world to implement what they argue is a politically liberal agenda, triggering a backlash from Democrats who are seeking to defend it.The controversy has led to some Wall Street firms backing down on ESG commitments, with insurers abandoning a United Nations-backed climate alliance becoming the latest example last month. BlackRock has itself been the target of investigations by some Republican-controlled states, and even an investment boycott in Texas.
However, as we reported, Florida Gov. Ron DeSantis has been an important leader in the pushback in a movement that attempts to force companies to adopt fiscally draining and time-wasting policies based on climate pseudoscience and social engineering. As we reported in March o this year, he led a coalition with 18 other governors against ESG.
Gov. Ron DeSantis, R-Fla., joined forces with 18 GOP governors to reject President Joe Biden’s environmental, social and corporate governance (ESG) “agenda,” claiming the push is a “direct threat” to the economic freedom of American retirees.Governors in Alabama, Alaska, Arkansas, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Oklahoma, South Dakota, Tennessee, Utah, West Virginia and Wyoming formed the alliance Thursday in what they described as an effort to ensure American retirement funds are not used for “woke” investments.
In fact, a significant part of Desantis’ newsbook is focused on his plans to “cripple” ESG.
“Both the legislative and executive branches should use their respective authorities to defend individuals against large corporations that are wielding what is effectively public power,” DeSantis wrote in “The Courage to Be Free,” which published Tuesday.“Reining in Big Tech, enforcing antitrust laws, prohibiting discriminatory job training, and crippling the ESG movement are all ways in which the political branches can protect individual freedom from stridently ideological private actor,” he wrote.
However, Florida and the other 18 states are not the only ones disenchanted with ESG. I reported at the end of last year the Europeans were also cooling toward ESG.
European funds that employ environmental, social and governance (ESG) metrics as a group are heavily “underweight” in oil and gas stocks but some tentative signs of a shift in positioning have appeared.Six per cent of European ESG funds now own Shell, compared to zero per cent at the end of last year, according to Bank of America. Holdings have also risen modestly this year in other energy companies, including Galp Energy, Repsol, Aker BP and Neste, across the 1,200 European ESG active and passive funds monitored by BofA.“We believe [some] ESG funds are revisiting the cost of exclusion [of energy companies] given their underperformance in the first half of 2022 or waiting for regulations to be finalised amid greenwashing fears,” says Menka Bajaj, an ESG strategist at BofA.
Fink, however, seems undaunted in pushing his climate and social morality on others via investment strategies.
But he said dropping references to ESG would not change BlackRock’s stance. The firm would continue to talk to companies it has stakes in about decarbonization, corporate governance and social issues to be addressed, he added.On the issue of climate change, BlackRock has sought to strike a balance, continuing to invest in fossil fuel companies while nudging them to adopt energy transition plans. It has projected that by 2030 at least three quarters of its investments will be with issuers of securities that have scientific targets to cut greenhouse gas emissions on a net basis.
However, investment targets and policies based on narrative science and bad data are doomed. Hopefully, the spectacular failure of covid “experts” and the disinformation campaign used to support their destructive tactics has made people aware of the essentially identical approach that has been adopted for the “climate crisis,” but which has played out on a much longer time scale.
I would also like to give the Legal Insurrection team a pat on the back for making the term “ESG” toxic. But it looks like we still have a lot more work to do to make the entire concept unpalatable to sensible investors and responsible politicians.
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