BlackRock admits CEO Larry Fink’s ‘woke’ ESG activism focus could ‘materially adversely’ hit business

BlackRock CEO Larry Fink’s efforts to embrace “woke” environmental, social and governance policies, commonly known as ESG, could “materially adversely” slam the investment titan’s core business, the investment giant admitted in a regulatory filing.

“Risk factors” for BlackRock’s stock price include the fact that “BlackRock’s business, scale and investments subject it to significant media coverage and increasing attention from a broad range of stakeholders,” the firm disclosed in its annual 10-K filing with the Securities and Exchange Commission.

“Matters subject to scrutiny, such as ESG, may be viewed differently by various stakeholders and adversely impact BlackRock’s reputation and business, including through redemptions or terminations by clients, and legal and governmental action and scrutiny,” said the filing, which was submitted Feb. 23.

Representatives for BlackRock didn’t immediately respond to The Post’s request for comment.

BlackRock — the world’s largest money manager — has an ESG portfolio reportedly valued at $700 billion, a small percentage of its $10 trillion in total assets under management.

It has projected that by 2030, at least three quarters of its investments will be with issuers of securities that have scientific targets to cut greenhouse gas emissions on a net basis.

The firm’s has pioneered go-green initiatives thanks to its CEO, Fink, who has boasted about climate change’s long-term threat to the economy — and investment opportunity — during his 50-year career on Wall Street.

However, ESG — which encompasses a range of ethically responsible business practices, from curbing carbon emissions to cracking down on discrimination in the workplace — has become politically polarizing, as BlackRock noted in its 10-K SEC filing.

Though Democrats have defended the need for ESG in the workplace, Republican politicians have attacked ESG as President Joe Biden’s “woke” way for the corporate world to implement what they argue is a politically liberal agenda.

BlackRock was even targeted back in 2022 by 19 state attorneys general in conservative states including Arizona and Texas, who alleged that the asset manager’s ESG-related policies hurt the American energy industry.

The move led to an investment boycott of BlackRock in Texas, when the Lone Star state barred its biggest pension fund from investing in any of the 350 funds run by BlackRock and other financial firms.

Fink said last year that he stopped using the catch-all term because of how politicized it has become.

“I don’t use the word ESG any more, because it’s been entirely weaponized … by the far left and weaponized by the far right,” Fink said, noting that dropping the term wouldn’t change BlackRock’s stance.

The firm would continue to talk to companies it has stakes in about decarbonization, corporate governance and social issues to be addressed, he added during the Aspen Ideas Festival last June.

“We had … one of the best years ever, but I’m ashamed of being part of this conversation,” said Fink, noting that his annual letters to investors that addressed ESG issues were never meant to be political statements.

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Shannon Thaler

March 1, 2024 7:39 pm