BlackRock and Vanguard were once ESG’s biggest proponents–now they seem to be reversing course
- Media Manager
- Sep 13, 2023
- 1 min read
Aol.
Written By: Bob Rubin
Published: September 13th, 2023
Finance giants BlackRock and Vanguard seem to be changing their approach to Environmental, Social, and Governance (ESG) investment strategies, increasingly rejecting shareholder proposals that focus on environmental and social issues.
Vanguard Group says it has only approved 2% of the environmental and social resolutions brought by shareholders in 2023, down from 12% last year, joining BlackRock in rejecting a significant number of climate and social items.
The firms’ strong support of ESG investing in recent years has led some financial advisory firms and a segment of the public to question whether financial institutions should concentrate on financial performance rather than other considerations.
BlackRock and Vanguard have a reputation for backing ESG initiatives. Yet it's worth asking if this commitment was ever about ideology or simply a response to market demand. With recent statements from Blackrock CEO Larry Fink indicating a move away from controversial ESG terminology and a reported loss of approximately $4 billion in managed assets tied to ESG backlash, it's clear that they're feeling some heat. Though the loss may seem trivial for a company with over $9 trillion in assets under management, it’s far from pocket change.
