JP Morgan Chase Institutional investors BlackRock and State Street Global Advisors announced Thursday that they will end their participation in the massive United Nations Climate Change Alliance formed to combat global warming through corporate sustainability agreements. announced that participation would be significantly reduced in the event of
New York-based J.P. Morgan, led by Jamie Dimon, said in a statement that it has been selected from the so-called “Climate Action 100+” group of investors, citing the expansion of its internal sustainability team and the establishment of its climate risk framework in recent years. He explained that he was withdrawing.
Larry Fink’s BlackRock and State Street, which both manage trillions of dollars in assets, say the coalition’s efforts to combat climate change go too far and worry about potential legal issues. expressed.
The surprising announcement comes as the largest financial institutions in the United States and around the world face an onslaught of attacks from consumer advocacy groups and Republican states. Environmental, social and governance (ESG) priorities.
“The bank has built a team of 40 experts focused on sustainable investing, including investment stewardship experts who also leverage one of the largest buy-side research teams in the industry,” the bank shared with FOX Business. said in a statement. “Given these strengths and the evolution of our own management capabilities, JPMAM has decided to no longer participate in the Climate Action 100+ initiative.”
Meanwhile, BlackRock has withdrawn its U.S. operations from Climate Action 100+, shifting involvement in the partnership to BlackRock’s smaller international operations, where the majority of its clients are pursuing decarbonization goals. , first reported by the Financial Times on Thursday. A BlackRock spokesperson confirmed to FOX Business that the move was made in recent weeks.
And State Street said it pulled out of the partnership because Climate Action 100+’s “Phase 2” efforts were inconsistent with the company’s internal investment policies.
“SSGA believes that the enhanced Climate Action 100+ Phase 2 requirements for signatories are inconsistent with our independent approach to proxy voting and portfolio company engagement,” State Street said in a statement, according to the Financial Times. concluded,” the statement said.
Climate Action 100+ was formally established at the United Nations in December 2017 as a way to bring together the world’s largest private financiers of greenhouse gas producers. Since its founding, the association has grown to include more than 700 financial institutions, collectively responsible for managing a staggering $68 trillion in assets.
The group, overseen by a non-governmental steering committee made up of ESG activists, calls on its members to engage with companies on “improving climate governance.” Reducing carbon dioxide emissions Strengthen climate-related financial disclosure policies. Its actions are primarily aimed at investments that benefit the oil and gas industry while promoting green energy investment strategies.
The Climate Action 100+’s ‘Phase 2’ strategy, due to be implemented later this year, calls on member investors to actively engage with companies to reduce their carbon footprint.
“More than 700 investors are committed to managing climate risk and preserving shareholder value through their participation in this initiative,” a Climate Action 100+ spokesperson told FOX Business on Thursday. “Since its inception, Climate Action 100+ has experienced impressive growth and continues to do so.”
“This initiative recently entered its second phase, with more ways for investor signatories to participate,” the spokesperson continued. “Over 60 new signatories joined last fall alone, and we expect interest to continue to grow.”
Climate Action 100+, in addition to other global climate alliances and investor networks, drew the ire of state Republicans. Some lawmakers also argue that their activities could interfere with government policy decisions. They also warned that these groups are harming the nation’s energy companies, which employ thousands of Americans and ensure low consumer prices.
In June, House Judiciary Chairman Jim Jordan (R-Ohio) accused Ceres, a nonprofit advocacy group that helps oversee the Climate 100+, that the group violated U.S. antitrust laws and They issued subpoenas alleging that they may be facilitating collusion through efforts focused on fluctuations. Law.
“Today’s decision by JPMorgan and State Street is a major victory for freedom and the American economy, and we hope more financial institutions will follow suit and abandon collusive ESG behavior,” Jordan said. he said in a social media post on Thursday.
In addition, the State Attorney General, Treasurer and Agriculture Commissioner They have banded together in recent months to threaten legal action related to banks’ involvement in the Climate Alliance.
“The exits of JPMorgan, State Street and BlackRock are a necessary step in the right direction, but consumers should wait until they trust these companies again,” said Will Hild, executive director of Consumers Research. ” he said. “By leaving the Climate Action 100+ climate cartel, they are demonstrating that the actions of millions of consumers and dozens of elected officials are having an impact.”
“These asset managers are clearly afraid of bad press and legal action for their disruptive net-zero drive,” Hild added.
