Blackrock departs net zero initiative, joining other firms in mass exodus from net zero groups

Blackrock Inc. has announced Thursday that it has decided to leave the Net-Zero Asset Managers initiative. This marks the seventh financial firm to quit the group in the last month. 

Blackrock, which has over $11 trillion in assets under management, said in a letter to clients that its membership in the group “caused confusion regarding BlackRock’s practices and subjected us to legal inquiries from various public officials,” Bloomberg reported. 

The company was among the asset managers named in a lawsuit led by Texas, alleging violations of antitrust laws in pursuing net zero goals for coal companies. Blackrock was also the target of a House Judiciary Committee investigation, Bloomberg noted, into anticompetitive behavior on the part of the financial industry pursuing environment, social and governance initiatives. 

"The news of BlackRock's exit from the Net Zero Asset Managers Initiative is a historic win for consumers and a decent start for BlackRock rolling back its destructive influence on America's economy. Now, BlackRock must work to fully repair the damage it has caused by ending the harmful incentives it put in place for executives via ESG, beyond net zero targets, including racial and sex-based discrimination in hiring and promotion," Will Hild, executive director of Consumers' Research, a consumer advocacy group, said in a statement.

The Net-Zero Asset Managers initiative is a group of roughly 325 asset managers, overseeing about $50 trillion, that are committed to achieving net zero alignment by 2050. Six of the largest U.S. banks have abandoned the Net Zero Banking Alliance, which is a similar coalition for lenders. Citigroup, Bank of America, Goldman Sachs, and Wells Fargo left in December, and this was followed by Morgan Stanley and JP Morgan in January, The Center Square reported. 

The NZBA, according to its website, is a bank-led and United Nations-convened organization coordinating their lending, investment and capital markets activities to be in line with net-zero emissions by 2050.