MercoPress. South Atlantic News Agency

“BlackRock’s role in a net-zero carbon

Asked by a UK parliament committee, if BlackRock supports a net-zero scenario in which “no new investment is needed in coal, oil, and gas,” the asset manager responded: “No”

The world's largest assets manager BlackRock (with US$10 trillion in assets under management as of January 2022), will not stop investing in oil, natural gas, or coal, told a UK parliamentary committee in written responses to an inquiry on the role of the financial sector in the UK’s net-zero transition.  

 When asked if BlackRock supports a net-zero scenario in which “no new investment is needed in coal, oil, and gas,” the asset manager responded: “No,” citing dozens of statements from financial and environmental institutions, the Environmental Audit Committee received during the period of submitting evidence.   

“BlackRock’s role in the transition is as a fiduciary to our clients – it is not to engineer a specific decarbonization outcome in the real economy,” the asset manager added. BlackRock has faced criticism from both environmental campaigners for still investing in conventional energy and the Republican-led U.S. states for what they see as a boycott of the U.S. energy industry.

In recent weeks, multiple U.S. states governed by Republicans, led by Texas, have said they would withdraw state funds from BlackRock’s management, as they disapprove of the ESG (Environment, Social and Governance) investment policies of the world’s top asset manager. Over the course of just a few weeks, Louisiana, South Carolina, Utah, and Arkansas announced they would divest funds from BlackRock totaling more than US$1 billion.

In early October, Louisiana State Treasurer John Schroder announced in a letter to BlackRock’s chief executive Larry Fink that he would divest all Treasury funds from BlackRock. Louisiana has removed US$ 560 million to date and will pull out a total of US$ 794 million by year’s end, Schroder noted.

For months now, Republican states have said they would no longer do business with asset managers who have ESG-aligned investment policies, which, the states say, show that those financial firms are boycotting the oil and gas industry.