HomeBusinessBlackRock is trying to avoid the hot seat as the Republican Party...

BlackRock is trying to avoid the hot seat as the Republican Party takes power

The world’s largest money manager is trying to avoid political trouble as the Republican Party prepares to take over all of Washington.

BlackRock Inc. (BLK) withdrew from a UN-backed climate group known as the Net Zero Asset Managers Initiative (NZAM) late last week, following an exodus of several Wall Street banks from an affiliated group in the weeks before Donald Trump takes over the White House again.

BlackRock was also given more time to resolve an impasse with the Federal Deposit Insurance Corporation (FDIC) over its holdings in US banks, meaning the dispute will now play out in the early months of Trump 2.0.

The $11 trillion financial giant has been the target of Republican Party attacks over “woke” investments for years, with Republicans raising concerns about whether BlackRock’s vast stakes in US companies are forcing companies to adopt environmental, society and governance (ESG). BlackRock CEO Larry Fink has backed away from using the politically controversial acronym.

And Democrats have also been wary for years about whether BlackRock’s weight could pose risks to the financial system.

NYSE – Delayed quote USD

Closing: January 13 at 4:00:02 PM EST

BlackRock, which reports fourth-quarter earnings on Wednesday, will have to deal with all these political challenges as the Republican Party takes over the White House and Congress — a level of control that could create new headaches for the money management giant.

See also  Apple went public 44 years ago: what would your $10,000 investment be worth today?

A report last month from the House Judiciary Committee, led by Ohio Republican Jim Jordan, named BlackRock along with Vanguard and State Street (STT) in arguing that it had found “evidence of collusion and anticompetitive conduct” by the financial sector to “impose radical ESG strategies”. objectives” for American companies.

The report also criticized financial environmental alliances, saying they have created a “climate cartel.”

Last Thursday, BlackRock confirmed its departure from an environmental financial alliance known as the Net Zero Asset Managers Initiative (NZAM).

The group had a pledge of support from its NZAM members to help achieve net zero carbon emissions by 2050 by using their influence within the financial sector – such as supporting climate initiatives in corporate boardrooms by through proxy voting.

British Prime Minister Keir Starmer (right) meets Blackrock CEO Larry Fink at the United Nations on September 25. Photo: Leon Neal/Pool via REUTERS · via REUTERS/Reuters

“Our memberships with some of these organizations have caused confusion about BlackRock’s practices and subjected us to legal investigations from various government officials,” BlackRock told clients in a letter cited by Bloomberg.

See also  Ryanair launches share buyback plan for new purchases

The company added in the letter that its portfolio managers “continue to assess material climate-related risks.”

- Advertisement -
RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Recent Comments