By Brooke Mallory
3:56 PM – Monday, June 26, 2023
The debate over ecological, social, and governance (ESG) investment criteria has reportedly made BlackRock CEO Larry Fink feel “ashamed,” as he claimed that the term is being “misused by the far-left and far-right.”
“I’m ashamed of being part of this conversation,” Fink said, according to Axios.
Fink revealed to the outlet during a talk at the Aspen Ideas Festival on Sunday that Florida Governor Ron DeSantis’ decision to withdraw $2 billion in assets from Blackrock in 2022 had harmed his business.
“When I write these [investment] letters, it was never meant to be a political statement. … They were written to identify longterm issues to our longterm investors,” Fink asserted on Sunday.
When questioned about his previous remarks, Fink replied, saying he was not “ashamed” of ESG but rather the conversations revolving around it.
“I never said I was ashamed [of ESG],” he said, according to Axios. “I’m not ashamed. I do believe in conscientious capitalism.”
“I’m not going to use the word ESG because it’s been misused by the far-left and the far-right,” he continued. “We talk a lot about decarbonization, we talk a lot about governance … or social issues, if that’s something we need to address,” Fink’s response came off as deflective and vague.
Opponents , notably Republican legislators, have contended that ESG investment criteria violate firms’ fiduciary responsibility to their shareholders by forsaking the company’s fundamental financial objectives for a “woke agenda” and also not doing what shareholders desire.
Fink, one of corporate America’s most vocal proponents of ESG, reacted to critics of it in a letter to CEOs back in 2022.
The ESG trend “is not about politics. It is not a social or ideological agenda. It is not ‘woke,’” Fink claimed.
“It is capitalism, driven by mutually beneficial relationships between you and the employees, customers, suppliers, and communities your company relies on to prosper … Make no mistake, the fair pursuit of profit is still what animates markets, and long-term profitability is the measure by which markets will ultimately determine your company’s success,” He concluded.
In February, notable GOP leaders on the House Financial Services Committee formed a task group to plan a response to ESG investing guidelines.
“Progressives are trying to do with American businesses what they already did to our public education system—using our institutions to force their far-left ideology on the American people,” Financial Services Committee Chairman Patrick McHenry said in a statement. “Their latest tool in these efforts is environmental, social, and governance proposals. This is why I am creating a Republican ESG working group led by Oversight & Investigations Subcommittee Chair Bill Huizenga.”
“This group will develop a comprehensive approach to ESG that protects the financial interests of everyday investors and ensures our capital markets remain the envy of the world,” he continued. “Financial Services Committee Republicans as a whole will continue our work to expand capital formation, hold Biden’s rogue regulators accountable, and support American job creators.”