BlackRock has announced plans to leave the Net Zero Asset Managers Initiative (NZAMI), a collective aimed at cutting emissions to net zero by 2050.
In a statement issued to Reuters, BlackRock said that its membership in the group had caused confusion about the firm’s practices and subjected it to legal inquiries from public officials.
It added that its planned departure ‘does not change the way we develop products and solutions for clients or how we manage their portfolios’, with its portfolio managers continuing to ‘assess material climate-related risks’.
Net Zero Asset Managers Initiative
Launched in 2020, the Net Zero Asset Managers Initiative is an international group of asset managers committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner. According to the NZAMI website, the group includes more than 325 signatories, and $57.5 trillion in assets under management.
The loss of BlackRock, which boasts some $11.5 trillion in assets, is an undoubted setback for the initiative.
‘Climate risk is financial risk. NZAMI exists to help investors mitigate these risks and to realise the benefits of the economic transition to net zero,’ a statement issued by the group noted.
‘Investment risk’
A statement on BlackRock’s website, from 2022, echoes this sentiment, stating, ‘At BlackRock, we believe that climate risk is investment risk, and we strive to help our clients make the most informed choices to improve their investment outcomes. We believe investors and issuers 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 had previously stated its intention that at least 75% of corporate and sovereign assets managed on behalf of clients will be invested in issuers with science-based targets or equivalent, by 2030.
Its decision to leave NZAMI, however, raises questions about its medium- to long-term climate commitments.
Elsewhere, Republican leaders, like Judiciary Committee Chairman Jim Jordan, hailed BlackRock’s exit as a win for American prosperity, describing climate-related investor groups as harmful ‘woke capital’ movements, Reuters reported. Read more here.
