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BlackRock announced that it has decided to leave the Net Zero Asset Managers (NZAM) initiative, […]]
BlackRock Exits Net Zero Coalition, Says Move Won’t Change How it Manages Investments – ESG Today
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BlackRock Exits Net Zero Coalition, Says Move Won’t Change How it Manages Investments
Mark Segal
January 10, 2025
BlackRock announced that it has decided to leave the Net Zero Asset Managers (NZAM) initiative, a major multi-trillion dollar group of investment managers committed to supporting the goal of net zero greenhouse gas emissions by 2050, marking a significant symbolic victory for anti-ESG politicians who had been threatening the investment giant over its participation in the coalition.
Despite exiting the group, however, in the letter, signed by BlackRock Vice Chairman Philipp Hildebrand and Global Head of Sustainable and Transition Solutions Helen Lees-Jones, the firm said that the “departure doesn’t change the way we develop products and solutions for clients or how we manage their portfolios.”
NZAM was launched in December 2020 with a group of 30 asset managers representing approximately $9 trillion of assets under management (AUM), and now includes more than 325 signatories and over $57 trillion in AUM. Signatories to NZAM agree to a series of commitments, including working with asset owner clients on decarbonization goals, setting and reviewing interim targets for a proportion of assets to be managed in line with net zero by 2050, tracking portfolio emissions, prioritizing the achievement of emissions reductions in the sectors and companies in which they invest, and implementing a stewardship and engagement strategy – including a voting policy – consistent with a net zero by 2050 portfolio goal, among others.
BlackRock, as the largest global investment management company, and a leading voice in the investment community on climate and energy transition-related investment themes, has often found itself at the center of focus of the anti-ESG movement by Republican politicians in the U.S.
Most recently, BlackRock, alongside its peers Vanguard and State Street was the target of a Texas-led multistate lawsuit, accusing the asset managers of using their positions in climate-focused investment initiatives to manipulate coal markets and drive up the cost of energy, which included participation in NZAM as evidence.
In its letter to clients, BlackRock reiterated that “participation in NZAM didn’t impact the way we managed client portfolios,” but noted that its membership in the group “caused confusion regarding BlackRock’s practices and subjected us to legal inquiries from various public officials.”
The letter also highlighted BlackRock’s climate investing credentials, noting that the firm manages more than $1 trillion in sustainable and transition investment strategies. Climate-focused investing has been a key focus for BlackRock over the past few years, with the firm stating as recently as in its January 2025 Benchmark Policies for investment stewardship that it in its view “the transition to a low-carbon economy is one of several mega forces reshaping markets.” Notably, the stewardship policy document also reiterated that BlackRock “cannot – and does not try to – direct a company’s strategy or its implementation. Setting, implementing and overseeing strategy are the responsibility of management and the board.”
BlackRock’s announcement marks the latest in a rapid series of high-profile departures by U.S.-based financial services firms from net zero groups ahead of the inauguration of Donald Trump later this month, with all major banks – including JPMorgan, Citi, BofA, Morgan Stanley, Goldman Sachs and Wells Fargo – exiting the Net-Zero Banking Association (NZBA) over the past few weeks. Despite leaving the group, however, each of the banks have maintained their individual financed emissions reduction commitments.
Mark founded ESG Today following a 20 year career in investment management and research. Prior to founding ESG Today, Mark worked at Delaney Capital Management (DCM) in Toronto, Canada, most recently as the firm’s head of U.S. equities. While at DCM, Mark was part of the firm’s ESG team, responsible for evaluating and tracking the sustainability factors impacting portfolio companies, and assessing the suitability of companies for portfolio inclusion. Mark also spent several years in the sell-side research industry, covering the technology and services sectors. Mark holds an MBA from Columbia University in New York, a BBA from the Schulich School of Business at York University in Toronto, and is a CFA charterholder.
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