BlackRock, the world’s biggest asset manager, has faced increasing backlash about environmental, social, and governance (ESG) investing. A handful of US states have pulled billions of dollars from BlackRock funds over accusations of “greenwashing,” hurting the fossil fuel industry and turbocharging America’s “woke” culture.
On Tuesday, BlackRock’s Larry Fink told Bloomberg TV at the World Economic Forum in Davos that ESG investing has been tarnished:
“Let’s be clear, the narrative is ugly, the narrative is creating this huge polarization. “
“We are trying to address the misconceptions. It’s hard because it’s not business any more, they’re doing it in a personal way. And for the first time in my professional career, attacks are now personal. They’re trying to demonize the issues.”
The Republican crusade, including states such as Florida, Louisiana, and Missouri, said they would pull funds out of BlackRock, citing that the asset manager’s ESG efforts could impact investor returns.
In December, Florida made the most significant withdrawal, pulling $2 billion from BlackRock.
“Using our cash to fund BlackRock’s social-engineering project isn’t something Florida ever signed up for.
“It’s got nothing to do with maximizing returns and is the opposite of what an asset manager is paid to do,” Jimmy Patronis, Florida’s chief financial officer, said in a recent statement.
Meanwhile, Texas Lt. Gov Dan Patrick has urged state officials to label BlackRock as a hostile entity for its action in the attempt to crush the oil and gas industry.
BlackRock is “capriciously discriminating’” against fossil fuel firms, Patrick said as he called for the asset manager to be added to the list of financial firms that “boycott” fossil fuels.
Several other states are pushing back on BlackRock.
Recall Tesla CEO Elon Musk called ESG a “scam” last year after the electric-vehicle maker was excluded from an S&P Global ESG index.