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Yahoo
3 days ago
- Business
- Yahoo
BlackRock removed from Texas divestment list after climate alliance exits
This story was originally published on ESG Dive. To receive daily news and insights, subscribe to our free daily ESG Dive newsletter. The Texas Comptroller's office has removed BlackRock from the state's list of companies who allegedly 'boycott the oil and gas industry,' according to a Tuesday press release. State Comptroller Glenn Hegar credited BlackRock for exiting the Net-Zero Asset Manager initiative and downgrading its participation in Climate Action 100+, which he said was 'directly related to [the state's] listing process' in a June 3 statement accompanying the update. BlackRock was among the initial 10 firms named in the divestment list published in August 2022 and, despite quarterly updates to the list, was the only United States-based firm listed and banned from doing business with the state. The divestment list was created by a 2021 Texas law banning the state from doing business with companies that 'limit commercial relations' with fossil fuel companies. After Hegar added London-based bank NatWest Group to the list in August 2024, the list had grown to include 16 companies and 350 investment funds that qualified for divestment. After the June 3 update, the list stands at 15 companies — all based outside of the U.S. — and 332 funds. Hegar said, in addition to BlackRock's changed participation in industry climate groups, the nation's largest asset management firm 'dramatically reduced the number of fund offerings that prohibit investments in oil and gas' and has 'acknowledged the real social and economic costs, both in Texas and globally, that come from limiting investment in the oil and gas industry.' BlackRock shifted its membership in CA100+ to a smaller international arm of its business in February 2024; more than 70 investors have left the group since House Republicans began probing its membership. BlackRock's exit from NZAM this January prompted the United Nations-backed group to suspend all operations while it undergoes a full review of its program. The Texas comptroller said his team hoped to create a process 'that gave companies a clear understanding of how they got on our list and a definitive path to removal' and BlackRock took steps to ensure they were removed. 'This is a meaningful victory and validates the leadership Texas has shown on this issue, which has seen a monumental shift in the way companies, governments and individual Americans view the energy sector,' Hegar said. 'While it took [BlackRock] longer than others in the financial sector to make the shift, the end results are what matter.' The removal of BlackRock from the state's divestment list comes after the Texas Permanent School Fund pulled $8.5 billion in funding from the asset manager to comply with the state law. At the time, a BlackRock spokesperson told ESG Dive that the divestment was 'arbitrary' and ignored the firm's '$120 billion investment in Texas public energy companies.' Hegar said Tuesday that BlackRock has shown 'real commitment to overall policy changes and a desire to act as a trusted partner in the growth of the Texas economy' by supporting the creation of the Texas Stock Exchange and "limiting support for activist shareholders to curtail fossil fuel investments.' However, Hegar said that assessment and those actions are 'unrelated to [the state's] listing decision.' While BlackRock is no longer on the divestment list, the firm is still a defendant, along with Vanguard and State Street, in a lawsuit filed by Texas Attorney General Ken Paxton accusing the asset managers of forming a 'cartel' to artificially restrict the coal market. The nation's largest three asset managers have denied the allegations and filed a joint motion to dismiss the lawsuit, though the Federal Trade Commission and Department of Justice issued a joint statement last week siding with Paxton and 10 other Republican-led states' view of the case. BlackRock is also facing scrutiny from Congressional Democrats for its climate alliance walkbacks. The firm was one of 12 major U.S. banks and financial institutions that received a letter from Democratic lawmakers which sought to understand where the company's current climate commitments stand. BlackRock did not immediately respond to a request for comment. Recommended Reading Texas AG drops probe of major US banks following NZBA exodus
Yahoo
4 days ago
- Business
- Yahoo
BlackRock's Larry Fink gets a Texas reward for ESG retreat
BlackRock's (BLK) retreat from "ESG" initiatives has it back in good stead with a key Texas official, a victory for CEO Larry Fink, even as the world's largest money manager remains a target of the state's antitrust cops. Texas Comptroller Glenn Hegar announced on Tuesday that the lone star state had struck BlackRock from a list of financial companies that, by law, are mostly prohibited as state contractors and investments. Texas added BlackRock to that list in 2022, restricting state businesses with the Wall Street giant. Hegar said in a statement that BlackRock "has acknowledged the real social and economic costs, both here in Texas and globally, that come from limiting investment in the oil and gas industry." Since 2021, Texas law SB13 has required the comptroller's office to list companies that harm, penalize, or limit commercial relations with companies in the fossil fuel industry, Texas' largest economic driver. It requires state agencies to block and divest state investments in those firms, unless they qualify for an exemption. Hegar said the decision to take BlackRock off the boycott list was "in part because it stepped back from full participation in the Climate Action 100+ and completely exited the Net Zero Asset Managers initiative" and because "dramatically reduced" its fund offerings that boycotted fossil fuel investments. "We appreciate the comptroller's resolution of this matter," Blackrock said in a statement. "BlackRock is proud to help millions of Texans retire with dignity and, on behalf of clients, invests over $400 billion in corporations, local governments, energy infrastructure and other private assets throughout the state." Texas's status change for BlackRock comes after Fink made a series of disengagements from the firm's environmental, social, and governance (ESG) initiatives as bipartisan concerns spread over the financial giant's power to sway US markets. Fink publicly stated in June 2023 that he would cease using the politically sensitive acronym "ESG" because it had been "weaponized" by both the ideological right and the left. In January, the financial giant cut ties with UN-backed Net Zero Asset Managers Initiative (NZAM), an environmental advocacy group that pledged net-zero carbon emissions by 2050. But the comptroller's embrace of BlackRock hasn't yet stopped Texas' Attorney General Ken Paxton from pushing ahead with a legal fight to dilute BlackRock's and two other US financial giants' alleged influence over the fossil fuel industry. Paxton and 10 other Republican-led states filed an antitrust case against the trillion-dollar asset manager and its rivals State Street (STT) and Vanguard, in November, which last week attracted support from the US Justice Department and the US Federal Trade Commission. The case alleges that BlackRock and its rival financial firms coordinated a "left-wing ideological" attack on US coal companies by pressuring coal producers such as Arch Coal, Black Hills (BKH), and Peabody (BTU) to cut coal production in the South Powder River Basin and thermal coal markets. The decreased output, they said, harmed US consumers by artificially inflating energy prices. As large yet minority shareholders, the complaint claims, the defendants have more influence than their formal equity share. With that influence, they claimed, the defendants agreed to reduce output through their commitments to carbon-reduction organizations Net Zero Asset Managers Initiative and Climate Action 100+. AG Paxton's office didn't immediately respond to a request asking if the state's removal of BlackRock's from the comptroller's list will impact the antitrust claims. However, the removal suggests that the state no longer views BlackRock as a company that harms, penalizes, or limits commercial relations with fossil fuel industry companies. BlackRock asked for a judge to dismiss the case and accused the administration of trying to "re-write" antitrust law under an "absurd" theory that the coal companies conspired with them to reduce production outputs. "Forcing asset managers to divest from coal companies will harm their ability to access capital and invest in their businesses and employees, likely leading to higher energy prices," the company said in a statement. Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on X @alexiskweed. Click here for in-depth analysis of the latest stock market news and events moving stock prices
Yahoo
4 days ago
- Business
- Yahoo
BlackRock's Larry Fink gets a Texas reward for ESG retreat
BlackRock's (BLK) retreat from "ESG" initiatives has it back in good stead with a key Texas official, a victory for CEO Larry Fink, even as the world's largest money manager remains a target of the state's antitrust cops. Texas Comptroller Glenn Hegar announced on Tuesday that the lone star state had struck BlackRock from a list of financial companies that, by law, are mostly prohibited as state contractors and investments. Texas added BlackRock to that list in 2022, restricting state businesses with the Wall Street giant. Hegar said in a statement that BlackRock "has acknowledged the real social and economic costs, both here in Texas and globally, that come from limiting investment in the oil and gas industry." Since 2021, Texas law SB13 has required the comptroller's office to list companies that harm, penalize, or limit commercial relations with companies in the fossil fuel industry, Texas' largest economic driver. It requires state agencies to block and divest state investments in those firms, unless they qualify for an exemption. Hegar said the decision to take BlackRock off the boycott list was "in part because it stepped back from full participation in the Climate Action 100+ and completely exited the Net Zero Asset Managers initiative" and because "dramatically reduced" its fund offerings that boycotted fossil fuel investments. "We appreciate the comptroller's resolution of this matter," Blackrock said in a statement. "BlackRock is proud to help millions of Texans retire with dignity and, on behalf of clients, invests over $400 billion in corporations, local governments, energy infrastructure and other private assets throughout the state." Texas's status change for BlackRock comes after Fink made a series of disengagements from the firm's environmental, social, and governance (ESG) initiatives as bipartisan concerns spread over the financial giant's power to sway US markets. Fink publicly stated in June 2023 that he would cease using the politically sensitive acronym "ESG" because it had been "weaponized" by both the ideological right and the left. In January, the financial giant cut ties with UN-backed Net Zero Asset Managers Initiative (NZAM), an environmental advocacy group that pledged net-zero carbon emissions by 2050. But the comptroller's embrace of BlackRock hasn't yet stopped Texas' Attorney General Ken Paxton from pushing ahead with a legal fight to dilute BlackRock's and two other US financial giants' alleged influence over the fossil fuel industry. Paxton and 10 other Republican-led states filed an antitrust case against the trillion-dollar asset manager and its rivals State Street (STT) and Vanguard, in November, which last week attracted support from the US Justice Department and the US Federal Trade Commission. The case alleges that BlackRock and its rival financial firms coordinated a "left-wing ideological" attack on US coal companies by pressuring coal producers such as Arch Coal, Black Hills (BKH), and Peabody (BTU) to cut coal production in the South Powder River Basin and thermal coal markets. The decreased output, they said, harmed US consumers by artificially inflating energy prices. As large yet minority shareholders, the complaint claims, the defendants have more influence than their formal equity share. With that influence, they claimed, the defendants agreed to reduce output through their commitments to carbon-reduction organizations Net Zero Asset Managers Initiative and Climate Action 100+. AG Paxton's office didn't immediately respond to a request asking if the state's removal of BlackRock's from the comptroller's list will impact the antitrust claims. However, the removal suggests that the state no longer views BlackRock as a company that harms, penalizes, or limits commercial relations with fossil fuel industry companies. BlackRock asked for a judge to dismiss the case and accused the administration of trying to "re-write" antitrust law under an "absurd" theory that the coal companies conspired with them to reduce production outputs. "Forcing asset managers to divest from coal companies will harm their ability to access capital and invest in their businesses and employees, likely leading to higher energy prices," the company said in a statement. Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on X @alexiskweed. Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 days ago
- Business
- Yahoo
Texas allows state agency investment in BlackRock after firm steps away from climate initiatives
The Texas Comptroller's office removed international investment giant BlackRock Inc. from a list of companies public agencies were required to divest from as the company has realigned with state law by withdrawing from key clean energy initiatives. Senate Bill 13, passed in 2021, requires the comptroller's office to maintain a list of financial firms that 'boycott' the fossil fuel industry, and included BlackRock, several other companies and roughly 350 investment funds before Tuesday's update. Texas Comptroller Glenn Hegar called the removal of BlackRock and over a dozen investment funds a 'meaningful victory' for Texas' energy economy but clarified in a statement that the list or divestment proceedings were not done to intentionally target companies. 'We never set out to punish any of these firms, and the hope was always that any firm we included on the list would eventually take steps to ensure they were removed,' Hegar said. SB 13 defines boycotting as refusing, terminating or penalizing business with a company that works in the fossil fuel industry 'without ordinary business purpose.' Known as an 'anti-ESG (environment, social and governance) law,' the bill led the Teacher Retirement System of Texas and the Texas Permanent School Fund to divest billions from BlackRock in 2023 and 2024. The firm was placed on the initial list in 2022 for its involvement in initiatives like Climate Action 100+, which aims to reduce corporate greenhouse gas emissions. Direct investment into fossil fuel companies does not preclude firms from being considered as boycotting, according to an information sheet from the state comptroller's office. BlackRock has since stepped back from Climate Action 100+ and completely removed itself from another initiative, Net Zero Asset Managers, which the comptroller's office attributed to the company's removal. In a statement to the Texas Tribune, John Kelly, BlackRock global head of corporate affairs, said they appreciated the comptroller's resolution and touted the firm's investment in other state affairs. 'BlackRock is proud to help millions of Texans retire with dignity and, on behalf of clients, invests over $400 billion in corporations, local governments, energy infrastructure and other private assets throughout the state,' Kelly said. 'These investments support the continued growth of the Texas economy.' Among the firm's in-state investments is assistance in creating a Texas-based Stock Exchange, which aims to launch in February 2026 with a boost from new legislation signed by Gov. Greg Abbott in mid-May. BlackRock was one of the initial investors, and Hegar said that while the investment in the stock exchange plan was unrelated to the list update, it represented 'a real commitment to overall policy changes.' BlackRock's removal from the divestment list has not completely withdrawn the business from scrutiny by Texas officials. Attorney General Ken Paxton sued the company and two others in November 2024, claiming they comprised an 'investment cartel' that intentionally bought shares in coal companies to reduce output and achieve clean energy standards. The Federal Trade Commission and the Department of Justice submitted a joint statement of interest in the case in late May. Hegar touched on the suit briefly in his remarks, but said the company's move away from clean energy initiatives is a signal of good favor. 'Even as legislators and state leaders continue to address lingering concerns about proxy voting and other policies that prioritize politics over profits, I am hopeful these actions represent a long-term shift,' Hegar said. Hegar and Paxton are facing their own lawsuit over SB 13 in federal court from the American Sustainable Business Council, a progressive business group. The suit claims the law violates companies' First and Fourteenth Amendment rights by discriminating against firms' viewpoints and circumventing due process. That suit is scheduled for a motion hearing on June 18. First round of TribFest speakers announced! Pulitzer Prize-winning columnist Maureen Dowd; U.S. Rep. Tony Gonzales, R-San Antonio; Fort Worth Mayor Mattie Parker; U.S. Sen. Adam Schiff, D-California; and U.S. Rep. Jasmine Crockett, D-Dallas are taking the stage Nov. 13–15 in Austin. Get your tickets today!
Yahoo
5 days ago
- Business
- Yahoo
BlackRock Escapes Texas Oil-Boycott List After ESG Retreat
(Bloomberg) -- BlackRock Inc. was removed from Texas' blacklist of companies that boycott fossil fuels, ending a three-year standoff over the environmental policies of the world's largest asset manager. Where the Wild Children's Museums Are Billionaire Steve Cohen Wants NY to Expand Taxpayer-Backed Ferry The Global Struggle to Build Safer Cars At London's New Design Museum, Visitors Get Hands-On Access LA City Council Passes Budget That Trims Police, Fire Spending The move means pension funds and other state-run investment accounts — which manage more than $300 billion of assets — will be allowed to purchase BlackRock shares, invest in its exchange-traded funds and hire the firm for advice and risk management. Inclusion on the list resulted in some Texas entities pulling billions of dollars of assets from the firm. State Comptroller Glenn Hegar said BlackRock had rolled back many of its green-focused initiatives, including exiting the Net Zero Asset Managers initiative and stepping back from the Climate Action 100+, a group devoted to cutting greenhouse gas emissions. The move marks a win for BlackRock Chief Executive Officer Larry Fink, who has been courting Texas leaders. Last year, he took the stage with Lieutenant Governor Dan Patrick at a summit focused on shoring up the state's energy grid, and just months ago BlackRock sponsored a table at the Black Tie & Boots Gala, a celebration of conservative politics in Texas. The company is also backing a Dallas-based Texas Stock Exchange. 'We appreciate the Comptroller's resolution of this matter,' a spokesperson for the firm said in a statement. 'BlackRock is proud to help millions of Texans retire with dignity and, on behalf of clients, invests over $400 billion in corporations, local governments, energy infrastructure and other private assets throughout the state. These investments support the continued growth of the Texas economy.' Hegar touted some of BlackRock's steps. He said while they are 'unrelated' to the listing decision, the actions 'show a real commitment to overall policy changes and a desire to act as a trusted partner in the growth of the Texas economy.' The company was a major target for conservative activists for years, with groups taking out advertisements around the country targeting the firm and Fink in particular. They argued the company was trying to influence corporate America and wider society through its support for ESG and sustainable investing. Republican officials in several states joined in that campaign, pulling money from the firm and arguing that it was harming fossil-fuel producing states like Texas. Fink himself said he would no longer use the ESG term because it had been politicized. 'We never set out to punish any of these firms, and the hope was always that any firm we included on the list would eventually take steps to ensure they were removed,' Hegar said in a statement. 'BlackRock, following the lead of many of its competitors, has finally done exactly that. While it took the company longer than others in the financial sector to make the shift, the end results are what matter.' BlackRock and a number of other financial firms including UBS Group AG and BNP Paribas SA were added to Texas' blacklist in 2022. The action followed a law that restricted business with companies that the state considered to be hostile to the energy industry. Since then, the ESG push at investment firms, pension funds and law practices has faded somewhat, partly because of efforts to avoid attacks by President Donald Trump and Republicans. BlackRock has been seeking to get off the list since it was added. The firm had always maintained it didn't run afoul of the law. At the time it was included, the company said the decision was 'not a fact-based judgment' and detailed investments of more than $100 billion in Texas energy companies. As head of Texas' finances, Hegar is required to update the list once a year and can do so as often as quarterly. And though his office reviews information on an ongoing basis, removing BlackRock is likely to be one of Hegar's last actions in the post. The three-term comptroller has been named the next chancellor of the Texas A&M University System after its current leader steps down on June 30. --With assistance from Julie Fine, Amanda Albright and Silla Brush. (Adds comment from BlackRock in fifth paragraph.) YouTube Is Swallowing TV Whole, and It's Coming for the Sitcom Millions of Americans Are Obsessed With This Japanese Barbecue Sauce Trump Considers Deporting Migrants to Rwanda After the UK Decides Not To Mark Zuckerberg Loves MAGA Now. Will MAGA Ever Love Him Back? Cuts to US Aid Imperil the World's Largest HIV Treatment Program ©2025 Bloomberg L.P. Sign in to access your portfolio
