The state of Florida is pulling $2 billion worth of assets from BlackRock in what has been dubbed the largest ‘anti-ESG divestment.’
ESG, which stands for “Environmental, social, and governance”, is a framework designed to understand how organizations navigate matters of sustainability.
And as of late, ESG has become an especially ‘hot topic’ with the political left saying that more investments are required to support it, while the right believes that far too much is being invested already.
The world’s largest money manager, BlackRock, has been criticized not only by Florida for its ESG investment policies and has just come under fire from the republicans, who are lashing out against ‘woke’ corporations.
The main argument is that ESG investing strategies (currently a $40 trillion business) are being used to promote an ideological agenda that would be voted down come election day.
Florida’s treasury announced it will freeze around $1.43 billion worth of long-term securities and will remove another $600 million worth of short-term investments from BlackRock’s management.
These investments will be given to other money managing firms as early as in the beginning of 2023, according to the statement of Jimmy Patronis, Florida Chief Financial Officer.
“I need partners within the financial services industry who are as committed to the bottom line as we are – and I don’t trust BlackRock’s ability to deliver,” he said in a statement.
Patronis also added that he believes it to be ‘undecomatric’ for giant asset managers to try and influence societal outcomes and went on to call BlackRock’s ESG investing a ‘social-engineering project.’
Another key figure in the opposition against ‘woke’ ESG investing is Florida Gov. Ron DeSantis, who is widely expected to run against Donald Trump for presidential nominee in 2024.
DeSantis started making calls on Florida to stop supporting ESG already in August.