BlackRock, Which Manages Over $10 Trillion, Strikes Back at ESG Critics (axios.com) 114
Investment giant BlackRock is rebutting Republican politicians over its ESG investment policies, arguing that its critics are wrong on both the science and the cents. Axios: Private equity and other investment fund managers should pay close attention, because they could be next in the line of fire. Last month, 18 state attorneys general sent a letter to BlackRock, essentially arguing that its goal of moving toward a net-zero economy is in conflict with its fiduciary duty. Two states, Texas and West Virginia, also banned state entities from doing business with BlackRock, arguing (incorrectly) that the firm boycotts fossil fuel company investments.
Axios' Alayna Treene reports that the BlackRock blowback is part of a coordinated lobbying effort, writing: "The crusade against ESG investments is something many conservatives feel deeply about -- they view these companies as cultural enemies who are misusing investment funds to promote pro-climate policies... House Republicans plan to make an assault on ESG a central part of their legislative and investigative agenda if they take back the majority in November's midterms." BlackRock yesterday responded to the AG's letter, with a 10-page letter of its own. After again disputing the "boycott" accusations, the firm wrote: "We believe investors and companies that take a forward-looking position with respect to climate risk and its implications for the energy transition will generate better long-term financial outcomes." BlackRock is the world's largest asset manager, and its CEO Larry Fink has been very outspoken about ESG initiatives (with declining emphasis as the acronym progresses). In other words, it's a juicy target.
Axios' Alayna Treene reports that the BlackRock blowback is part of a coordinated lobbying effort, writing: "The crusade against ESG investments is something many conservatives feel deeply about -- they view these companies as cultural enemies who are misusing investment funds to promote pro-climate policies... House Republicans plan to make an assault on ESG a central part of their legislative and investigative agenda if they take back the majority in November's midterms." BlackRock yesterday responded to the AG's letter, with a 10-page letter of its own. After again disputing the "boycott" accusations, the firm wrote: "We believe investors and companies that take a forward-looking position with respect to climate risk and its implications for the energy transition will generate better long-term financial outcomes." BlackRock is the world's largest asset manager, and its CEO Larry Fink has been very outspoken about ESG initiatives (with declining emphasis as the acronym progresses). In other words, it's a juicy target.
Boycott investments in buggy-whip manufacturers (Score:5, Funny)
Pretty much Re:Boycott investments in buggy-whip (Score:1)
Yeah, if you set the clock back to before "peak buggy-whip" but after the handwriting was on the wall and responsible people knew "peak buggy-whip" was coming soon and invested accordingly.
Back then, the only good excuse for making long-term investments in buggy whips was if you were sincerely wrong about your long-term outlook on buggy whips. I'm sure a few financial investors who overall made good decisions for their clients fell into that category.
Re:Boycott investments in buggy-whip manufacturers (Score:4, Insightful)
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You know that gasoline/petroleum products are used for things other than cars right? Anything made of plastic uses petroleum. fertilizers, a host of industrial chemicals, etc, etc, etc. Li-ion batteries aren't going to replace that. To even maintain our current standard of living in the West we will need petroleum decades from now, unless someone invents a Star-Trek replicator.
So to go back to the horse and buggy analogy it would be like investing in a company that wanted to replace horse and buggies with r
Re:Boycott investments in buggy-whip manufacturers (Score:4, Insightful)
In your example, maybe one petroleum company is spending money on expanding refinery capacity to make more diesel fuel. Another petroleum company is investing in making plastics more efficiently. The investors would look at this and say that, even if the stocks have similar returns today, the one investing in plastic capacity is a better long-term investment.
The point of the investment thesis is that companies that are planning their business around where the world will be in a decade or two are better investments than those planning their business around where the world will be in a year or two.
The *objection* here is that many companies have positioned their businesses to thrive in a more environmentally-friendly world. That bothers some people whose personal agenda does not involve a better environment. But when BlackRock makes an investment, they are essentially saying that they agree in part with the company's predictions. Therefore there is anger directed at BlackRock
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>Have most correctly assessed future petroleum needs"
The danger here is in who decides what the correct determination is. Some would say zero, others, something else.
My concern is that such an arbitrary, non-fiduciary delineator can become the basis of approving or denying loans. It's not a stretch of the imagination that if you don't subscribe to the Diversity, Inclusion and Equity (DIE) or whatever else then you're not going to be able to borrow money no matter what your credit score is.
Allowing one se
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fiduciary duty requires environmental awareness (Score:3)
Your second sentence kinda sounds like it conflicts with third sentence. At least, to me it seems like it could use some clarification.
The fiduciary duty essentially requires that the officers seek the goals that the shareholders want them to, putting the interests of the investors above their own interests.
The most OBVIOUS example is that an officer can't have the fund spend $1 million buying a 100 pens from his brother. That's putting his own interest above the interest of the client, which is what the fi
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Fiduciary duty very much does NOT mean the fiduciary must seek to maximize monetary returns above all else. They'd only have to do so if that was the stated goal of the fund, corporation, trust, etc.
Adding to this point, even if there were a fiduciary duty to maximize monetary returns above all else, there typically isn't any time scale specified for that return. A long-term investment that is expected to eventually return more than some other option with higher short-term gains, is still a valid investment based on fiduciary duty.
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Once again, we have an article on slashdot, that does not help at all by spelling out WTF another acronym like "ESG" stands for?!?!
I get the feeling it is important to understand the article....and hell, I even went to the link to read it and unless I missed something, it assumed you knew what ESG stood for.
*SIGH*
Re:Boycott investments in buggy-whip manufacturers (Score:5, Informative)
ESG stands for environmental, social, and corporate governance. It's basically a social credit score for companies. If you and your employees go along with their political viewpoints, vote and donate to their candidates, implement their policies, then you get a good score and companies like Blackrock and Vanguard will invest pension funds etc with those companies even if other companies are more profitable.
This is where Blackrock is running headlong into the law since Blackrock supposedly has a fiduciary duty to make profits, not become an extension of a political party. Blackrock obviously disagrees, they believe that the people that own the pension funds etc have no say in the matter.
Re:Boycott investments in buggy-whip manufacturers (Score:5, Informative)
Wrong. Blackrock has a fiduciary duty to follow the investment strategy that it purports to follow, not to maximize profits above all else. If it were otherwise, then every sector fund, contrarian fund, and other special purpose fund could equally be accused of violating their "fiduciary duty" because they've, as a matter of judgment, excluded certain investments from the scope of what the fund will invest in.
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I don't want my investments made along political lines...I want to make money, plain, clear and simple.
That's my retirement we're talking about....I'll vote and send money set aside for political support, but I don't want politics fucking around with my investments for my after work life.
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Therefore, even outside of an ESG fund, companies that are being proactive about their environment impact are better positioned for the future. Th
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a fiduciary duty to make profits
Within the remit of other stated goals. It is allowable for a company to say it will not invest in companies with names in the last half of the alphabet provided this is made clear and it seeks to do its fiduciary duty in the first half. The idea that it must be profits above all else, within the law, is false.
WTF (Score:5, Insightful)
is ESG?
Would it kill you to say in TFS?
Even TFA doesn't define it (Score:3, Insightful)
TFA does say "ESG began as a marketing buzzword for many investment firms, but since has become an integral part of investment strategy."
For the uninitiated - that is, most non-finance-people - ESG means "Environmental, Social, and Governance" factors that are taken into account in investing.
Urbandictionary.com [urbandictionary.com] has some other possible meanings. Enjoy.
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So in other words, invest by ideology?
Yes and no Re:Even TFA doesn't define it (Score:1)
So in other words, invest by ideology?
On an individual-investor level, you are probably right - ideology is one of many factors that an individual might consider when making investments.
For funds who are investing to maximize long-term returns, it's more like "what impact will other investors' ideologies have on the market-value of our portfolio."
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Re:Even TFA doesn't define it (Score:5, Insightful)
So in other words, invest by ideology?
Only in the sense, and to the extent, that ideology and other "soft" factors often drive markets.
You may or may not believe that AGW is real. You may personally feel that companies' planning and acting according to social and governance concerns won't give them a competitive edge nor improve their market share. But if you're an investment firm and your trend analyses indicates that climate and social concerns are already starting to drive markets and policies, then your fiduciary duty is to inform your clients of this and advise them accordingly.
I never thought I'd find myself defending an investment company FFS - read my sig. But I read BlackRock's letter to the AG's, and it seems pretty much on point. The AG's are coming off as dinosaur-defending paid shills, which they probably are.
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"Believe" in AGW? Belief is not necessary, facts - supported by corroborated data, without refutation - are. But more importantly, you'd need to show corroboration of models with reality.
So far - over the theory's 80+ year lifespan - that's been in short supply.
Re: Even TFA doesn't define it (Score:1)
Re: Even TFA doesn't define it (Score:4, Informative)
Only to the extent that Trumplicans have become ideologically opposed to the environment, society and free government.
There might be other factors driving this. The biggest one I can think of are the pension funds of each state. See those pension deals were mostly setup in the 70s when a 6% annualized return was realistic from fixed income (bonds). This was the case because inflation was much higher back then. Then the last 35 years happened with low inflation and low rates of return from bonds. Compound that with the fact that later generations were smaller so there were less teachers paying into the system and you have a system that is in a death spiral. So we have these huge pension funds which are going to be insolvent in the future. Now this is the fault of everyone involved, the public sector unions and the politicians. The unions refused to reform the system to make it solvent and they politicians ignored the problem by throwing money at it. However as time passes, the amount of money you have to throw at the problem grows faster than government revenue. So eventually we reach a point where the state needs to choose between paying working teachers and paying the pensions of retired teachers.
So we have this huge multi-trillion dollar mess that can't be fixed by just throwing money at the problem. And nobody wants to get the blame when the pension funds inevitably fail. So this move seems like a way to shift blame to wall street. Now the firms that advised the pension funds do bear some responsibility but hindsight is 20/20 and pension funds need to invest conservatively as they have constant payouts to make. This hurts returns. Expecting firms to consistently return more than the market average while avoiding the dips by investing conservatively is unreasonable. Add this ESG stuff into the mix and you are giving the politicians and unions a scapegoat that they will gladly use. And all of this is before we start talking about if the ESG ratings are really valid (as in are the companies rated highly actually helping in the way folks think). They rate 1000s of companies and there are plenty of questionable ratings that are given. The debt ratings agencies (e.g. S&P) aren't exactly known for their accuracy and they are only rating credit worthiness. Now change that from measurable investment returns to some nebulous concept of "goodness", judged by someone who perhaps has some political bias and how well did we think this would go?
Re: Even TFA doesn't define it (Score:3)
It's not meant to mean that, and BlackRock are stone cold hard capitalists.
It's meant to mean invest in things that going to keep making money, because investing in things that self-destruct isn't a sensible long term plan.
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is ESG?
Would it kill you to say in TFS?
I wasted three minutes of my life to find out because I too wanted to know. "Environmental, Social, and Governance". Ugh.
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It literally might, as copy-pasting the article summary seems to be the way now on slashdot, actually editing requires minimal effort.
Wikipedia came up with these:
Dr. Luis MarÃa Argaña International Airport (IATA code: ESG), an airport serving Mariscal Estigarribia in Paraguay
E.S.G. (rapper) (born 1973), American rapper from Houston, Texas
Elektroniksystem- und Logistik-GmbH, a limited liability company founded in 1967 in Munich
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ESG => Environmental, Social, and Governance
Environmental => Reducing contributions to climate change and being prepared for climate change.
Social => A bit broad: seems to be about being fair to workers, customers, community. Can include fair wages, workers' rights, and diversity.
Governance => Also somewhat broad: having transparent and well-defined policies about how the company is run. E.g., policies about executive compensation, political lobbying, and hiring.
Why are Republicans attacking it?
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Millennials are the existing work force and now entering into their 30s and 40s. The emerging work force is the next generation, which is a lot more conservative by all available data than millennials, so now parents and empty nesters are trying to preserve their cushy government handouts before their kids outvote them.
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It's your social credit score.
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Look up DEI (Diversity, Equity, Inclusion) while you look up ESG. It's part of the same financial/cultural push which, quite strangely, started just when the covid virus uh "escaped" from the labs in China where they'd role played that exact scenario, several months prior.
It's not some grand conspiracy theory, it's been well documented and is being pushed by the World Economic Forum (WEF). https://www.facebook.com/dan.bongino/videos/klaus-schwab-lays-out-entire-globalist-plan-in-under-60-seconds/16827311454
WTF is an ESG? (Score:3)
FFS editors. Do your job.(1)
The summary is a copy and past of the article. And the article doesn't define what an ESG is. Apparently as an engineer I'm supposed to know what an ESG is. The only way for me to know is google.
----
1. Yeah I know. This is /.
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Snap!! (or "jinx" for Americans)
Nope. (Score:2)
Actually producing summaries that include definitions for relevant terms requires time and effort. It is much cheaper and easier to just copy the first few paragraphs and move on. Furthermore, actual summaries tend to inhibit click-through, since you "get the goods" without clicking through.
So, this cheaper more click-baity process of copying the first few paragraphs is clearly what Slashdot is incited to do. I don't like it either, but, I use slashdot for free so I don't think I have much room to whine.
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Complaining about the "editors" on /. is a tradition. Just like in Soviet Russia Natalie Portman has Cowboy Neal's hot grits. Although Netcraft may be confirming that this process is dying.
Um, nope Re:Nope. (Score:1)
In Soviet Russia, CowboyNeal's grits heat YOU!
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Just for the record, ESG (Environmental, Social, and Governance) investment is about investing in presumably more environmentally or socially responsible companies. I guess it lets people make money without all the associated guilt of doing so.
Yeah, I had to look it up too. No, I have no idea what this article is doing on slashdot.
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Same old thing... (Score:2)
People who are paid to look at risk are investing based on researched risk.
People who don't research risk or listen to those who do are complaining.
The world turns.
Political risk is still risk (Score:1)
I happen to agree with the science, but whether the science is right or not, there is still political risk on both sides of this.
I'm not talking international politics here, I'm talking boycotts - both formal and informal.
If enough people - or rather, people controlling enough money - decide they want to either throw their money behind investments that match their politics or boycott investments that run counter to them, the price of the investment will be influenced by the politics.
If you are a fiduciary,
Re:Political risk is still risk (Score:5, Informative)
Imagine you have two retailers. One installs solar panels on their roof because it makes financial sense and electric car charging in their parking lot to attract customers.
Another retailer prohibits electric vehicles from parking in their parking lots and only stocks goods made in slave-wage factories in environmentally hazardous ways.
As an investor, maybe you hate the environment and roll coal on your way to work. Still you might decide that the former retailer has better long-term prospects than the latter and do your job as a fiduciary and steer more of your clients' money toward the former even if you do your own shopping at the latter.
That's essentially what BlackRock has done. And they've done it based on what they believe are the most thorough evaluations. Some people absolutely hate it because, well, they are fragile and it goes against their preferred world view. Other people hate it because they need the fragile people's votes.
Until... Re:Political risk is still risk (Score:1)
Until a few states start banning electric cars and solar panels and a few other states start requiring them, and the investment community is trying to out-guess each other as to which side will "win" knowing that investing in the "winner" will make money for their clients.
OK, I exaggerate - even "red states" have huge investments in the "green economy" for this example to be realistic. But when it comes to other "environmental, social, governance" concerns, we could wind up with companies having to "pick a
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Re:Political risk is still risk (Score:5, Insightful)
And this fiduciary has concluded that companies who have done this risk evaluation are going to perform better EDIT: LONG-TERM than companies that have not done such a risk evaluation or who have done it in a flawed way.
You missed one hyphenated word, but it's a crucial one.
Long-term is no longer seen by a large number of big money movers as a valid target for investment. They want return, and they want return NOW. Next quarter if you must, but this quarter would be better. Anything past that is, as far as they are concerned, unnecessary, unconfirmed, unsubstantiated, and completely irrelevant. Fast returns. If it burns the entire world in the process? Don't care. I need those dolla dolla dolla bills y'awl. NOW NOW NOW!
This type of short-term thinking is destroying not just us as a people, but us as a country and as a viable species. People need to stop listening to MBA analysis of next-quarter-only markets and taking that mentality to the extreme or we're all as screwed as the short-term-profit-only venture capitalist killed companies.
ESG Can’t Square With Fiduciary Duty (Score:4, Interesting)
"ESG Can’t Square With Fiduciary Duty" https://www.wsj.com/articles/e... [wsj.com]
"Nineteen state attorneys general wrote a letter last month to BlackRock CEO Laurence D. Fink. They warned that BlackRock’s environmental, social and governance investment policies appear to involve “rampant violations” of the sole interest rule, a well-established legal principle. The sole interest rule requires investment fiduciaries to act to maximize financial returns, not to promote social or political objectives. Last week Attorneys General Jeff Landry and Todd Rokita of Louisiana and Indiana, respectively, went further. Each issued a letter warning his state pension board that ESG investing is likely a violation of fiduciary duty."
Re:ESG Can’t Square With Fiduciary Duty (Score:4, Interesting)
IANAL and I didn't RTFA...especially one which is paywalled. But a quick perusal seems to indicate that the 'sole interest rule' is about conflicts of interest versus the 'maximize shareholder value' type thing.
That latter bit is neither codified law nor legal doctrine, it was the opinion of economist Milton Friedman back in the 1970's. Not saying it is right or wrong, but not a legal thing. Though again, IANAL.
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IANAL and I didn't RTFA...especially one which is paywalled. But a quick perusal seems to indicate that the 'sole interest rule' is about conflicts of interest versus the 'maximize shareholder value' type thing.
That latter bit is neither codified law nor legal doctrine, it was the opinion of economist Milton Friedman back in the 1970's. Not saying it is right or wrong, but not a legal thing. Though again, IANAL.
The WSJ link I provided should be a free permalink
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-- Joe Biden
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Corporations are bound to follow their charters. If Blackrock's corporate charter states its intent as squeezing every nickel whether it makes sense or not, then they're in trouble. Maybe you can find new york state document 150402010052, which is their articles of incorporation. I got bored trying.
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. If Blackrock's corporate charter states its intent as squeezing every nickel whether it makes sense or not, then they're in trouble.
I doubt any charter says that because that intent enforces a methodology that cannot be changed. Sometimes even the most risk taking capitalists have to turn down an investment as being too risky or unwise for the company. For example that charter would have dictated they go heavy into markets that collapsed like junk bonds in the 1980s, dotcoms in the late 1990s, housing in 2008, and crypto this past year and somehow survive all of them.
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Well, that's kind of my point. For example, intelligent cloud resources inc. [sec.gov] of NV (clearly you can find this stuff on edgar, I just didn't look hard enough — not sure why there couldn't just be a link from the view I did find, though, except the usual government incompetence) put "ANY LEGAL PURPOSE" on their filing. But then there are typically other charters presented to shareholders, like the charter of the board...
Oh the irony (Score:1)
By coming out and saying it's likely a violation of fiduciary duty, it may get even more investors to demand certain ESG policies, thereby validating the fiduciary obligation to have such policies.
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They warned that BlackRock’s environmental, social and governance investment policies appear to involve “rampant violations” of the sole interest rule, a well-established legal principle.
By their logic, any fund that invests in highly risky ventures would be violating that rule. For example, hedge funds that bet heavily on shorts like Melvin Capital which tried to short GameStop and got squeezed out for billions in losses. Those arguments seem to be against free market capitalism.
Re:ESG Can’t Square With Fiduciary Duty (Score:4, Informative)
They warned that BlackRock’s environmental, social and governance investment policies appear to involve “rampant violations” of the sole interest rule, a well-established legal principle.
By their logic, any fund that invests in highly risky ventures would be violating that rule. For example, hedge funds that bet heavily on shorts like Melvin Capital which tried to short GameStop and got squeezed out for billions in losses. Those arguments seem to be against free market capitalism.
There's nothing unusual about a "highly risky" portfolio. High risk can translate to high returns - and big losses.
All that is required is
- The portfolio risk level is honestly communicated and is consistent with client expectations
- The investment strategy is executed legally and competently.
WRT this ESG issue, have a look at https://www.in.gov/attorneygen... [in.gov]
Excerpt:
"ESG investments focused on social or board quotas issues fare no better. For example, the state of California was unable to find academic studies to substantiate its contention that there is “a causal connection between women on corporate boards and corporate governance,” leading to a court finding the state’s gender mandate unconstitutional.
A focus on risk-return for investments must be grounded in a reasonable, objectively-based investigation that carefully considers material economic conditions, including factors such as inflation, energy prices, geo-political conflict, and the opportunistic purchase of non-net zero compliant assets when doing so increases returns. Broad and potentially speculative predictions of future environmental impacts or governance policies (especially those that have been repeatedly rejected or disregarded) does not form an adequate basis for prudent investment decisions. A truly return-focused investment strategy cannot categorically exclude investment or assets for lack of alignment with net-zero emissions or the Paris Agreement, or force businesses to alter their operations to achieve those goals.58
Unless amended by our citizens through their elected representatives, the only commitment an Investment Manager can make with pension funds under Indiana law is to focus on financial return, not whether the underlying asset is dirty, clean, popular, or unpopular. Similarly, other ESG commitments are not made solely in the financial interests of plan beneficiaries. Under the sole interest standard, there can be no commitments or directives to follow ESG principles. Fiduciaries cannot use pension funds to accelerate the net zero transition, impose board quotas, or force companies to take action on climate change, or commit to any course of action except making a profit for beneficiaries. ESG commitments are invariably couched in language about reducing carbon emissions, and meeting Paris Climate Accord goals, or fostering equity and a “just transition.” All of these are motivations other than acting in the financial interests of beneficiaries. As one recent academic paper plainly put it, “a trustee’s use of ESG factors, if motivated by the trustee’s own sense of ethics or to obtain collateral benefits for third parties, violates the duty of loyalty.”59"
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There's nothing unusual about a "highly risky" portfolio. High risk can translate to high returns - and big losses.
And my point is not every single investment company chooses high risk portfolios for a reason. That logic means all these companies would be violating single interest rule as they are not maximizing their investors' money especially in the short tem.
"ESG investments focused on social or board quotas issues fare no better. For example, the state of California was unable to find academic studies to substantiate its contention that there is “a causal connection between women on corporate boards and corporate governance,” leading to a court finding the state’s gender mandate unconstitutional.
And the point is? California mandated something on gender as a matter of law that was found to be unconstitutional. Blackrock's strategy has been to invest in more ESG investments. If publicly traded BlackRock chooses a strategy that is unprofitable for their in
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If publicly traded BlackRock ....
This ignores the fact that BlackRock is a publicly traded company...
That last statement ignores choice and freedom of a publicly traded company...
Again BlackRock is making a profit and governments imposing their own politics on to publicly traded companies...
You have fixated on "publicly traded" like it grants a company some special dispensation to operate as it sees fit. It does not.
Public or private, BlackRock is engaging in a heavily regulated business.
The lawsuit alleges they are violating the law. BlackRock disagrees. We'll see how the lawsuit gets resolved.
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You have fixated on "publicly traded" like it grants a company some special dispensation to operate as it sees fit. It does not.
No I am pointing out that the structure of a publicly traded company HAS rules on how to change governance and thus strategy. The investors of any publicly traded company wishing to change business decisions have options.
Public or private, BlackRock is engaging in a heavily regulated business.
And what part of the regulations dictate which investments BlackRock must invest? By that logic, Warren Buffett should have been sued into oblivion by the states for not investing in dotcoms and crypto. On the other end, Melvin Capital should have been sued by states for failing to short Ga
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The sole interest rule requires investment fiduciaries to act to maximize financial returns
If this specious horseshit was true, it would ban hedge funds, because they're an investment vehicle that is actually expected to lose money overall, but provide liquidity during a downturn.
Luckily for the investment class, that's not the rule. The rule is they have to maximize whatever they said they're maximizing, which is often "value" that is well-known to include things like societal concerns, or the future of the species, etc., as the company wants to define it.
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The sole interest rule requires investment fiduciaries to act to maximize financial returns
If this specious horseshit was true, it would ban hedge funds, because they're an investment vehicle that is actually expected to lose money overall, but provide liquidity during a downturn.
Luckily for the investment class, that's not the rule. The rule is they have to maximize whatever they said they're maximizing, which is often "value" that is well-known to include things like societal concerns, or the future of the species, etc., as the company wants to define it.
That's not what a hedge fund is. Here, a simple description from "Investopedia": https://www.investopedia.com/a... [investopedia.com]
KEY TAKEAWAYS
- Hedge funds are financial partnerships that use pooled funds and employ different strategies to earn active returns for their investors.
- These funds may be managed aggressively or make use of derivatives and leverage to generate higher returns.
- Hedge fund strategies include long-short equity, market neutral, volatility arbitrage, and merger arbitrage.
- They are generally only a
If only... (Score:5, Insightful)
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The teensy weensy smallish problem there being that those investors are actually perfectly happy with what Blackrock is doing.
It's the politicians who are hopping mad that Blackrock makes sound investments in things they don't like.
Re:If only... (Score:5, Insightful)
The teensy weensy smallish problem there being that those investors are actually perfectly happy with what Blackrock is doing.
It's the politicians who are hopping mad that Blackrock makes sound investments in things they don't like.
In this case it's the pension fund managers who like ESG, the politicians and state attorney generals are telling the pension fund managers that they need to stop investing politically and maximize returns for their state employees. That seems like a very reasonable stance that pools of investor money that aren't self-directed need to maximize returns. If/when these ESG companies become the optimal return on investment the pension funds can pivot into those companies.
The reason this is an issue is because an ESG activist company used the California pension fund votes a couple years ago to shake up the Exxon board, there's really no reason private activists should be dictating the voting shares for pools of government employee money to make political changes at targeted companies. If a private activist investor wants to buy a big share of Exxon in a bid to make them change course that's one thing, but using pooled investor money that wasn't intended for that purpose is pretty sketchy imo.
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> stop investing politically
They aren't investing politically, in the sense that it's any more political than any other investment. They (Blackrock) seem to be doing their due diligence and selecting investments with the best outlooks. If it happens that the investments with the best outlooks are also aligned with environmental and social issues - or even if they appear to be good investments because they are so aligned - that does not make the investments "political."
> If/when these ESG companies bec
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It's about power (Score:1, Troll)
As usual. People with money use it to influence and shape society. Whether it's the military industrial complex that controls Washington, D.C., or currency manipulators like George Soros, or Klaus Schwab at the World Economic Forum, or the SJWs at BlackRock... People with money use it to impose their will on the rest of us.
ESG is an umbrella term describing programs used to exert control under the guise of morality, and nothing more.
In other words, cancel culture (Score:5, Insightful)
Remember folks, big government Republicans have your best interests in mind. Only government knows what's best. Government is your friend.
This is all just for show (Score:5, Interesting)
It's never about politics. It's always about money. This is Blackrock. They're currently engaged in a massive market manipulation scheme to drive up the cost of single family homes in America. They are not nice people. They do not care about anything but cash in hand.
Why "ESG" then? Good optics. Nobody looks past the headline to find out that their claims are bullshit. They are investing in wind and solar, but so is everybody else. It's the most profitable form of electricity now, even without the subsidies. And with those subsidies it's free money.
Companies have been running these kind of optics scams since the 90s. The right wing shouted about PC then and they're shouting about it now. What's next, are we gonna bring back Senate hearings about Mortal Kombat?
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Here's a crazy idea (Score:5, Informative)
And you're ignoring all the *apartment* blocks they're buying. Every single apartment in 30 miles of me is owned by 1 company. My rent went up 115% in the last 10 years. That's 11.5% annual inflation. That is not an accident.
This isn't going to end well for anyone. Keep boxing people into a corner and they'll get violent. Then they'll install a dictator. Just like they did in China & the USSR.
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That sucks. However, if your rent went up 115% in 10 years, that is 2.15^(1/10) = 1.0796, or about 8% annual inflation. Which is pretty bad considering that for 9 of those years inflation was very low, sometimes non-existent.
Re:This is all just for show (Score:5, Informative)
| This is Blackrock. They're currently engaged in a massive market manipulation scheme to drive up the cost of single family homes in America
There are two giant companies with almost identical names but very different strategies: Blackrock and Blackstone. Not a joke.
Blackrock is an enormous financial fund manager, many of the funds are index funds, iShares, and is the primary index fund competitor to Vanguard.
Blackstone is a private equity investment partnership & fund family heavily into direct real estate ownership. Blackstone is the one buying houses.
followup with link. (Score:2)
https://www.blackrock.com/us/i... [blackrock.com]
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Why "ESG" then? Good optics. Nobody looks past the headline to find out that their claims are bullshit. They are investing in wind and solar, but so is everybody else. It's the most profitable form of electricity now, even without the subsidies. And with those subsidies it's free money.
Your own sentences contradict each other.
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Woke was originally a left wing term coined in the 30's as stay woke and resurrected by BLM (and Antifa) to mean waking up to their agenda.
It became a meme and a mockery the way the Summer of Love made a mockery out of their message.
Sure Blackrock and other greed corporations love ESG as they feel it gives them the moral high ground when abandoning fiscal responsibility.
ESG is Conservative (Score:1)
Back before the republican party became fascist and abandoned all conservative principles, republicans would argue against regulations and talk about how consumers should be controlling issues like this via the market. Which is fair.
Now that ESG is becoming a legitimately big deal and it is interfering with the companies which pay republicans bribes to represent their interests in congress, all of a sudden they are willing to throw the market right in the garbage and implement their own regulations.
There w
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Interesting, its surprising that I hadn't heard of it through some groups I participate in.
If there is a regulatory requirement to complete this then I'm sure it will be fit for purpose in context. It's certainly very detailed and specific.
In other contexts in which ESG may need to be assessed/addressed this is...perhaps not what it needs to be yet. I appreciate the heads up, though, this may become my next nightmare.
Goals? (Score:1)
Never forget (Score:2)
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It's not about the size, but what the government can and can't do.
But it is of the interest of many people in all sides that the whole discussion turn into a size slider, so things like "i want a small government that is focused on keeping corporations in check" are not even discussed.
Dilbert (Score:2, Informative)
The legal precedent is that if it appears in Dilbert it's held to be common knowledge (which ESG has). Not that an extra sentence would have hurt!
Anyway, Blackrock is the company buying up all the single family homes above market value to make sure that everybody is renting. It's killed home-ownership in many markets.
"You will own nothing and be happy" is part of the ESG-associated ethos and there is a strong difference of opinion among the populous about whether corporate ownership of all resources is th
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The legal precedent is that if it appears in Dilbert it's held to be common knowledge (which ESG has). Not that an extra sentence would have hurt!
Anyway, Blackrock is the company buying up all the single family homes above market value to make sure that everybody is renting. It's killed home-ownership in many markets.
"You will own nothing and be happy" is part of the ESG-associated ethos and there is a strong difference of opinion among the populous about whether corporate ownership of all resources is the right way to go. The Authoritarian Left is real big on the idea and believes it's "the only way to save the planet". Pretty much everybody else disagrees, but the politicians and legacy media are mostly onboard. Even Axios.
You're mixing up BlackRock and Blackstone. Don't do that.
What do you think the context in which "You will own nothing and be happy" was said? Do you think it was said seriously? Perhaps you can tell us who said it, and in which context, and why anyone should care about it.
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“You Will Own Nothing and Be Happy,” said Klaus Schwab, Founder and Executive Chairman of the World Economic Forum.
From here [americaoutloud.com]. It was said in earnest and by someone with plenty of power. As for why you should care, I will leave that to others but it sounds like the plot of a dystopian sci-fi movie to me.
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“You Will Own Nothing and Be Happy,” said Klaus Schwab, Founder and Executive Chairman of the World Economic Forum.
From here [americaoutloud.com]. It was said in earnest and by someone with plenty of power. As for why you should care, I will leave that to others but it sounds like the plot of a dystopian sci-fi movie to me.
Nope. You need to do your homework /much/ more carefully than that.
Concern with ESG isn't over climate change... (Score:1)
The ESG score concerns involve the so called "Woke Agenda" where equity (rather than equality) is the order of the day and your race is considered to be more important than your skill set.
Corporations disregarding merit in hiring decisions in order to garner a higher ESG score causes long term harm both to internal operations and to a companies ability to compete globally.
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Stupid people ... (Score:2)