TALLAHASSEE -- The state of Florida is pulling $2 billion from the world's largest asset management firm, over the use of "Envinronmental, Social and Governance" standards (ESG).
CFO Jimmy Patronis says the state is freezing more than $1.4 billion in long term and $600 million in short term investments managed by BlackRock. The firm manages about $8 trillion.
Patronis says CEO Larry Fink is "on a campaign to change the world." He accuses Fink of trying to "avoid dealing with the messiness of democracy."
ESG ratings of companies can involve a wide range of issues such as climate change, carbon emissions, product safety, racial inequality and supply-chain labor standards. They'e been targeted by Republicans in several states and are likely to face scrutiny once the GOP assumes control of the U.S. House of Representatives.
Fink insists companies using the standards are "performing better" than their peers. He says "stakeholder capitalism" is not about politics or being 'woke' but "driven by mutually beneficial relationships" involving employees, customers, suppliers and communities. BlackRock says it's "surprised" by the decision "given the strong returns BlackRock has delivered to Florida taxpayers over the last five years." The company says neither Patronis nor his staff have raised performance concerns.
BlackRock says it has invested more than $65 billion into Florida's economy and it looks forward to continuing to invest and serve clients in Florida.
Information from the News Service of Florida was used in this report.