Tennessee sues BlackRock over ESG 'misrepresentations'
investmentweek.co.ukThe lawsuit is part of a series of attacks by Republican lawmakers against asset managers which consider sustainability objectives in their investing process.
Tennessee attorney-general Jonathan Skrmetti filed the lawsuit yesterday (18 December), arguing BlackRock had been inconsistent in its rhetoric over whether ESG investing could have financial benefits.
«Given its large size and prominence, BlackRock has led the charge in promoting aggressive ESG goals,» the lawsuit said, pointing to the firm joining Climate Action 100+ and the Net Zero Asset Managers Initiative.
US House Judiciary chair subpoenas Vanguard over ESG policies
The lawsuit is part of a series of attacks by Republican lawmakers against asset managers which consider sustainability objectives in their investing process.
Last week, Republican chair of the of the US House Judiciary Committee Jim Jordan subpoenaed Vanguard over its use of ESG in their investing process, with BlackRock rumoured to follow shortly.
The Tennessee lawsuit noted that, as backlash to sustainable investing in the US has grown, BlackRock has pulled back on its rhetoric around ESG, with CEO Larry Fink declaring he was discontinuing use of the term in June.
However, the lawsuit stated that BlackRock was also reluctant to withdraw its efforts from sustainable investing, due to potential «unwanted negative attention» from sustainability groups and ESG investors.
«Rather than risk either downside, BlackRock has chosen a third way: deceiving consumers about the company's extensive commitment to fulfilling ESG aims,» the lawsuit claimed.
It argued that holdings in non-ESG funds still use a stewardship and engagement strategy, such as pushing companies like Chevron to align their firms with
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