Florida Chief Financial Officer Jimmy Patronis announced Thursday that the state government will divest $2 billion of investments managed by financial services firm BlackRock due to tightening environmental, social and governance (ESG) standards ) organisation.
“Whether stakeholder capitalism or ESG standards are pushed by BlackRock for ideological reasons, or to develop social credit ratings, the effect is to avoid facing the mess of democracy,” Patronis wrote in a statement.
“I think it’s undemocratic for big asset managers to use their power to influence societal outcomes.”
In August, Florida Governor Ron DeSantis pushed through a resolution calling on the state to stop investing in ESG because of its “ideological agenda.”
BlackRock CEO Larry Fink posted a open letter in January describing the firm’s growing support for “stakeholder capitalism,” where the asset manager is able to choose clients in a socially responsible way.
“Stakeholder capitalism is not about politics. It is not a social or ideological program. It’s not ‘woke,’” Fink claimed in his letter.
The billionaire businessman is particularly pushing environmental sustainability among his clients, announcing in his letter that BlackRock would require companies to set “short, medium and long-term goals for the reduction of greenhouse gases” .
The Florida State Treasury will divest entirely from management of BlackRock by early 2023, according to Patronis.
The Florida Custodian Bank is currently freezing $1.43 billion in long-term securities managed by BlackRock and changing the management of $600 million in short-term overnight investments associated with the US Treasury Investment Pool. ‘State.
The Treasury Investment Pool oversees the investment of Florida’s general revenue and trust funds as well as funds from state-related organizations, including universities and government foundations.
“As major banking institutions and economists predict a recession in the coming year, and the Fed raises interest rates to combat the inflation crisis, I need partners within of the financial services industry who are as committed to the bottom line as we are,” Patronis said Thursday, adding that he “doesn’t trust BlackRock’s ability to deliver.”
He criticized Fink’s use of ESG standards “to help police who should and who shouldn’t have access to capital.”
“Using our money…to fund BlackRock’s social engineering project is not something Florida has ever signed on to,” the CFO added.
Comments are closed.