It’s been a tough couple weeks for BlackRock Inc., the world’s largest money manager, which endured fresh blows from Republican officials sharply critical of ESG.
On Wednesday, Texas said one of its Senate committees had issued a subpoena requesting documents about BlackRock’s environmental, social and governance practices, and asked for at least one of six executives, including Chief Executive Officer Larry Fink, to attend a Dec. 15 hearing. On the same day, Vanguard Group Inc., one of BlackRock’s main rivals, withdrew from the world’s largest climate-finance coalition, creating a potential selling point to anti-ESG clients. Florida said last week it would pull about $2 billion from BlackRock because of its ESG investments and Gov. Ron DeSantis’s administration is urging the manager of its pension to remove BlackRock as an asset manager.
The battle over sustainable investing comes as the 10 largest ESG funds by assets have posted double-digit losses this year, some even more than the S&P 500’s 17.5% decline. BlackRock’s $20 billion iShares ESG Aware MSCI USA exchange-traded fund is down about 19% and Vanguard Group’s $5.8 billion ESG U.S. Stock ETF has dropped 22%. Meanwhile, stocks of U.S. oil giants Exxon Mobil Corp. and Chevron Corp. have soared 69.8% and 44.2% respectively.
