Ginny Roscamp, Senior Press Secretary, Federal Communications, Sierra Club, ginny.roscamp@sierraclub.org
WASHINGTON, DC — On Tuesday, July 29, the State Financial Officers Foundation (SFOF) — a right-wing group pushing a costly anti-climate and anti-sustainable investing campaign — sent a letter to major asset managers, including BlackRock, asking them not to comply to sustainability reporting laws like the EU’s Corporate Sustainability Reporting Directive (CSRD). The Sierra Club’s Sustainable Finance campaign called the move “serious overreach” of a democratically approved law.
“This move by SFOF to pressure asset managers into undermining EU laws is a troubling new low. Pushing global financial institutions to contravene a democratically adopted regulatory framework from political allies is both highly problematic and a serious overreach,” said Jessye Waxman, Senior Advisor in the Sierra Club’s Sustainable Finance campaign. “The financial ideology espoused by SFOF in its letter fundamentally fails to grasp the nature of fiduciary duty, which evolves in response to changing markets. Prudent investors are increasingly focused on mitigating systemic risks like climate change, which have serious financial implications. Leading asset managers like BlackRock should be intensifying their efforts in this area, not retreating from them.”
The CSRD is designed to enhance transparency by providing investors with more accurate, comparable information on how companies interact with and impact the broader market and society. Improved disclosure is a cornerstone of sound investing, and if Republican leaders in the U.S. are opposing such measures, it raises a serious concern that they lack an understanding of the fundamentals of modern investment strategy.
BACKGROUND
BlackRock and its peers risk losing substantial amounts of business if they bow to pressure from SFOF.
The Sierra Club Foundation recently moved its business from BlackRock to other asset managers following BlackRock’s refusal to address the systemic financial implications of the climate crisis in its investment and stewardship decisions. New York City’s pension funds, representing $300 billion in assets, also put BlackRock and other asset managers on notice to submit net-zero plans that meet the pensions’ standards, stating the pensions would otherwise look elsewhere to manage their investments. California, a state with a $4.1 trillion GDP, has already passed a climate disclosure law, meaning major asset managers will need to comply if they want to do business in the fourth-largest economy in the world.
European pension funds have already pulled billions out of State Street, and asset owners across seven countries — including the $65 billion Dutch pension fund PME — have threatened to move their money from BlackRock as well. If American asset managers don’t do better, this could mean a wholesale loss of European business.
About the Sierra Club
The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.