BlackRock Inc., the world’s largest asset manager, joined the Climate Action 100+ initiative after mounting criticism in recent months about its dedication to fighting climate change.
The manager of $6.8 trillion in assets is among the biggest shareholders of most of the world’s listed businesses but has hesitated to use its voting power to push for changes, instead choosing to work through companies’ internal stewardship teams, according to The Financial Times. Former U.S. Vice President Al Gore last month accused BlackRock and Vanguard, the two largest U.S. asset managers, of helping finance the “destruction of human civilization.”
The addition of BlackRock boosts Climate Action 100+ members’ assets under management by about 20% to $41 trillion. The initiative begun in 2017 has more than 370 participants who pledge to act to support efforts to reduce greenhouse-gas emissions across the value chain, implement a strong governance framework and provide enhanced corporate disclosure.
“BlackRock’s decision to sign on to Climate Action 100+ reinforces that the world’s largest asset manager believes that climate change is a growing financial risk to both companies and the global economy,” Mindy Lubber, CEO of Ceres and a member of the Climate Action 100+ steering committee, said in a statement.
Ceres, a sustainability nonprofit, last year ranked BlackRock near the bottom of its annual analysis of mutual fund proxy voting on climate-related shareholder proposals, which used data from 2018.
“Sustainability investing is simply smart investing,” the top headline on BlackRock’s website reads.
BlackRock has voted against Climate Action 100+ shareholder proposals in the past and won’t be bound to vote for them even after joining the group, the FT said. But the company said it’s “accelerating our engagement with companies on this critical issue,” according to the FT report.
- BlackRock’s fossil fuel investments cost investors $90 billion in lost value and missed opportunities over the past decade, according to an August report from the Institute for Energy Economics and Financial Analysis.
- Climate Action 100+ focuses on companies that account for two-thirds of annual global industrial emissions and 60 others which have the opportunity to drive the clean-energy transition, according to its website.