By Jack Pitcher
BlackRock is pulling out of a United Nations-sponsored climate initiative, a remarkable U-turn for a company that was once a poster child of the environmental, social and governance investing movement.
The world's largest asset manager told clients in a letter Thursday that it has formally withdrawn from the Net Zero Asset Managers initiative, an international group of asset managers committed to supporting the goal of net-zero greenhouse gas emissions by 2050.
"Our memberships in some of these organizations have caused confusion regarding BlackRock's practices and subjected us to legal inquiries from various public officials," Vice Chairman Philipp Hildebrand wrote in a letter to clients seen by The Wall Street Journal.
Chief Executive Larry Fink famously wrote in 2020 that "climate risk is investment risk" and later asked the companies that BlackRock invests in to disclose a plan for how their business model would be compatible with a net-zero economy.
By 2023, Fink toned down his ESG rhetoric amid backlash from conservative groups. Texas, Oklahoma and other red states filed lawsuits against BlackRock, claiming its participation in climate-alliance groups violated its fiduciary obligations to investors.
Competitor Vanguard Group quit the same alliance in late 2022, and a number of U.S. megabanks have pulled out of a similar coalition over the past month.
Companies have been broadly pulling back from initiatives related to climate change and diversity equity and inclusion ahead of the second Trump administration. President-elect Donald Trump has called climate change a "hoax" and is expected to roll back related regulations.
Write to Jack Pitcher at jack.pitcher@wsj.com
(END) Dow Jones Newswires
January 09, 2025 17:09 ET (22:09 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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