BlackRock Inc., the world’s largest asset manager, has been taken off Texas’ blacklist of companies that boycott fossil fuels. This decision ends a three-year conflict over the firm’s environmental policies. As a result, Texas pension funds and state investment accounts, which manage over $300 billion, can now invest in BlackRock shares and funds, as well as hire the firm for financial advice.
State Comptroller Glenn Hegar announced that BlackRock has made significant changes to its green initiatives. The company has exited the Net Zero Asset Managers initiative and stepped back from the Climate Action 100+, a group focused on reducing greenhouse gas emissions. Hegar noted these actions demonstrate a commitment to policy changes and a willingness to work as a partner in Texas’ economic growth.
This decision is a win for BlackRock’s CEO, Larry Fink, who has been actively engaging with Texas leaders. He participated in a summit on the state’s energy grid and sponsored a table at a gala celebrating conservative politics in Texas. BlackRock has stated that it invests more than $400 billion in various sectors within Texas, supporting the state’s economy.
Hegar emphasized that while BlackRock’s changes were not directly related to its removal from the blacklist, they reflect a broader commitment to align with Texas’ interests. BlackRock was previously targeted by conservative activists who argued that the firm was influencing corporate America through its support for environmental, social, and governance (ESG) initiatives. Some Republican officials had withdrawn funds from BlackRock, claiming its policies were detrimental to fossil fuel-producing states like Texas.
In 2022, BlackRock and other financial firms were added to Texas’ blacklist under a law aimed at restricting business with companies perceived as hostile to the energy sector. Since then, the push for ESG initiatives has lessened, partly due to backlash from Republican leaders.
Hegar, who is set to become the next chancellor of the Texas A&M University System, stated that his office reviews the blacklist regularly. He expressed hope that companies would take steps to remove themselves from the list, which BlackRock has now achieved. This change marks a significant shift in the relationship between Texas and one of the largest investment firms in the world.