Top U.S. asset managers hesitant to join climate initiative due to regulatory concerns
From Investing.com: 2024-12-13 18:30:57
Top U.S. asset managers were hesitant to join a climate initiative for fear of appearing too collaborative and attracting regulatory attention, a report from a Republican-led U.S. congressional committee revealed. The report suggests fund firms and activists are part of a “climate cartel” colluding through shareholder organizations to cut emissions, a claim dismissed by Democrats.
BlackRock and State Street expressed concerns about “collusion” and “perception of engaging or voting as a block” if they joined the Climate Action 100+ initiative to press companies to reduce emissions. Despite these worries, both firms ultimately joined the initiative before stepping back earlier this year over independence concerns.
Republican officials, particularly from oil and gas producing states, have criticized investors coordinating to push corporate management on climate issues, arguing it could hamper corporate growth and returns. Last month, Republican attorneys general from 11 states sued BlackRock, State Street, and Vanguard for their climate activism, alleging it reduced coal production and raised energy prices. The firms collectively manage $26 trillion.
U.S. President-elect Donald Trump campaigned against President Joe Biden’s climate change initiatives and pledged to support U.S. oil and gas production. The Trump administration could potentially act on the congressional committee’s findings. A spokesperson for the committee declined to comment on any discussions with current or future administrations.
A section of the committee’s report details how top fund firms helped elect dissident directors at Exxon in 2021 under pressure from activists, including Ceres. In response, Ceres stated that the claims in the report are false and that Climate Action 100+ does not control shareholder votes. The dissident directors have been consistently reelected since, contradicting claims of hostility.
Read more at Investing.com: US House panel finds BlackRock, other asset managers wary of joining climate initiative By Reuters