JPMorgan, BlackRock drop out of massive UN climate alliance in stunning move

[D. Schlenk]

https://nypost.com/2024/02/15/business/jpmorgan-blackrock-drop-out-of-massive-un-climate-alliance-in-stunning-move


JPMorgan, BlackRock drop out of massive UN climate alliance
in stunning move


By Thomas Catenacci, Fox Business

Published Feb. 15, 2024


Originally Published by: Fox Business

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JPMorgan Chase and institutional investors BlackRock and
State Street Global Advisors announced Thursday that they
are quitting or, in the case of BlackRock, substantially
scaling back involvement in a massive United Nations climate
alliance formed to combat global warming through corporate
sustainability agreements.

In a statement, the New York-based Jamie Dimon’s JPMorgan
explained that it would exit the so-called Climate Action
100+ investor group because of the expansion of its in-house
sustainability team and the establishment of its climate
risk framework in recent years.

Larry Fink’s BlackRock and State Street, which both manage
trillions of dollars in assets, said the alliance’s climate
initiatives had gone too far, expressing concern about
potential legal issues as well.

The stunning announcements come as the largest financial
institutions in the US and worldwide face an onslaught of
pressure from consumer advocates and Republican states over
their environmental, social and governance (ESG) priorities.

“The firm has built a team of 40 dedicated sustainable
investing professionals, including investment stewardship
specialists who also leverage one of the largest buy side
research teams in the industry,” the bank said in a
statement shared with FOX Business. “Given these strengths
and the evolution of its own stewardship capabilities, JPMAM
has determined that it will no longer participate in Climate
Action 100+ engagements.”

JPMorgan CEO Jamie Dimon
https://nypost.com/wp-content/uploads/sites/2/2024/02/jpmorgan-chase-ceo-chairman-jamie-75489386.jpg?resize=1024,683&quality=75&strip=all
Jamie Dimon’s JPMorgan said the bank’s expansion of its
in-house sustainability team and the establishment of its
climate risk framework in recent years was the reason for
the pullout. REUTERS

BlackRock, meanwhile, withdrew its US business from Climate
Action 100+, shifting involvement in the alliance to
BlackRock’s smaller international entity where a majority of
clients are pursuing decarbonization goals, the Financial
Times first reported Thursday. A spokesperson for BlackRock
confirmed to FOX Business that the move had been made in
recent weeks.

And State Street said its exit from the alliance was made
because Climate Action 100+’s “phase 2” commitments
conflicted with the firm’s internal investing policies.

“SSGA has concluded the enhanced Climate Action 100+ phase 2
requirements for signatories are not consistent with our
independent approach to proxy voting and portfolio company
engagement,” State Street said in a statement, according to
the Financial Times.

https://nypost.com/wp-content/uploads/sites/2/2024/02/climate-activists-protest-outside-headquarters-39269926.jpg?resize=1024,683&quality=75&strip=all
Climate activists protest outside the headquarters of
BlackRock in September. REUTERS

Climate Action 100+ was formally established in December
2017 at the UN as a way of aligning the world’s largest
private sector financiers of greenhouse gas producers. Since
the association was created, it has grown to include more
than 700 financial institutions that are collectively
responsible for a staggering $68 trillion in assets under
management.

The group — which is overseen by a nongovernmental steering
committee comprised of ESG activists — calls for members to
engage companies on “improving climate change governance,”
curbing carbon emissions and strengthening climate-related
financial disclosure policies. Its actions have largely
taken aim at investments benefiting the oil and gas
industry, while boosting green energy investment strategies.

The Climate Action 100+ “phase 2” strategy, which was set to
be implemented later this year, calls for member investors
to actively engage with companies to reduce their carbon
footprint.

BlackRock CEO Larry Fink
https://nypost.com/wp-content/uploads/sites/2/2024/02/larry-fink-chairman-ceo-blackrock-76056982.jpg?resize=1024,683&quality=75&strip=all
The alliance’s climate initiatives had gone too far, Larry
Fink’s BlackRock said. REUTERS

“More than 700 investors are committed to managing climate
risk and preserving shareholder value through their
participation in the initiative,” a spokesperson for Climate
Action 100+ told FOX Business on Thursday. “Since its
inception, Climate Action 100+ has experienced remarkable
growth — and that has only continued.”

“The initiative has recently entered its second phase, which
offers more ways investor signatories can participate,” the
spokesperson continued. “Last Autumn alone, more than 60 new
signatories joined, and we expect interest to continue
growing.”

Climate Action 100+, in addition to other global climate
alliances and investor networks, has drawn the ire of
Republican states and lawmakers who have argued their
activities may infringe on government policymaking. They
have also warned such associations are harming domestic
energy companies which employ thousands of Americans and
ensure low consumer prices.

In June, House Judiciary Chairman Jim Jordan, R-Ohio, issued
a subpoena to Ceres, a nonprofit advocacy organization that
helps to oversee Climate Action 100+, alleging the group may
be facilitating collusion through its climate-focused
initiatives in violation of US antitrust law.

Climate activists demonstrate at BlackRock
https://nypost.com/wp-content/uploads/sites/2/2024/02/climate-activists-demonstrate-blackrock-east-21542753.jpg?resize=1024,695&quality=75&strip=all
Since Climate Action 100+ was formed in 2017, it has grown
to include more than 700 financial institutions that are
collectively responsible for a staggering $68 trillion in
assets under management.
James Messerschmidt

“Today’s decisions by JPMorgan and State Street are big wins
for freedom and the American economy, and we hope more
financial institutions follow suit in abandoning collusive
ESG actions,” Jordan wrote in a social media post on X on
Thursday.

Additionally, state attorneys general, financial officers
and agriculture commissioners have banded together in recent
months to threaten legal action related to banks’
involvement in climate alliances.

What do you think? Post a comment.

“JPMorgan, State Street, and BlackRock’s departure is a
necessary step in the right direction, but consumers should
wait to trust these companies again,” said Consumers
Research executive director Will Hild. “By leaving the
Climate Action 100+ climate cartel, they are signaling that
the actions of millions of consumers and dozens of elected
officials are having an effect.”

“These asset management firms are clearly afraid of the bad
press and legal actions taken against their destructive net
zero push,” Hild added.