(Bloomberg) -- BlackRock Inc. is parting ways with one of the world’s biggest climate-investor groups after being targeted by Republican politicians for its efforts on global warming.
The money manager has decided to leave the Net Zero Asset Managers initiative, it said in a letter to clients on Thursday. Membership in the group “caused confusion regarding BlackRock’s practices and subjected us to legal inquiries from various public officials,” the New York-based firm said.
BlackRock, which oversees more than $11 trillion, has been the subject of attacks from GOP lawmakers for embracing what conservatives call “woke” policies. Most recently, BlackRock was among a group of asset managers singled out in a lawsuit led by Texas alleging breaches of antitrust laws due to the adoption of pro-climate strategies that suppress coal production.
And with President-elect Donald Trump headed for the White House, Wall Street is bracing for more attacks on climate finance.
“BlackRock has hung in there as long as it could, but the pressure has become too great, and the reputational and legal risks too high, just before Trump takes office,” Hortense Bioy, head of sustainable investing research at Morningstar Sustainalytics, said in an emailed comment. And it “won’t be the last financial organization to quit a net zero initiative,” she said.
BlackRock was mentioned, along with firms including State Street Corp. and Vanguard Group Inc., in a report last month from the House Judiciary Committee that said it found “evidence of collusion and anticompetitive behavior” by the financial industry to “impose radical ESG-goals” on US companies.
Over the past month, a climate coalition for lenders, the Net-Zero Banking Alliance, has seen a mass exodus of US members. Since early December, NZBA lost Goldman Sachs Group Inc., Wells Fargo & Co., Citigroup Inc., Bank of America Corp., Morgan Stanley and JPMorgan Chase & Co.