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Texas Fund Manager: BlackRock "Misusing Funds" to Push ESG Agenda

  • Texas terminated its $8.5 billion investment with BlackRock due to concerns about BlackRock's environmental, social, and governance (ESG) investing practices.
  • Texas accuses BlackRock of harming the state's oil and gas industry while managing funds that rely on revenue from that industry.
  • Texas' divestment is the largest since states began cutting ties with BlackRock over ESG standards.

The examples of the ESG fraud imploding over the last 6 months simply aren't stopping.

The latest has come from Texas, where the state is now terminating an $8.5 billion investment with BlackRock due to the investment manager's boycott of energy companies, according to a report from Fox News

Texas State Board of Education Chairman Aaron Kinsey said this week that the Texas Permanent School Fund notified BlackRock this week that it would be terminating the investment. 

Kinsey told Fox News this week: "The Texas Permanent School Fund has a fiduciary duty to protect Texas schools by safeguarding and growing the approximately $1 billion in annual oil and gas royalties managed by the Texas General Land Office. Terminating BlackRock’s contract ensures PSF’s full compliance with Texas law."

Kinsey added: "BlackRock’s dominant and persistent leadership in the ESG movement immeasurably damages our state’s oil & gas economy and the very companies that generate revenues for our PSF. Texas and the PSF have worked hard to grow this fund to build Texas’ schools."

"BlackRock’s destructive approach toward the energy companies that this state and our world depend on is incompatible with our fiduciary duty to Texans," he said. 

Texas has made a significant move by divesting a considerable portion of its $53 billion Permanent School Fund (PSF), originally established in the 19th century to support public education. This step marks the largest divestment since GOP-led states began cutting financial relations with BlackRock and similar firms over their adoption of ESG standards. 

In response to such opposition, Texas enacted Senate Bill 13 in 2021, mandating the state's comptroller to identify and list financial entities boycotting fossil fuel businesses. Following this, Texas Comptroller Glenn Hegar updated this list in October to include BlackRock among others, urging the Texas PSF and five state pension funds to cut off from the investment company.

Kinsey concluded: "Today represents a major step forward for the Texas PSF and our state as a whole. The PSF will not stand idle as our financial future is attacked by Wall Street. This bold action helps ensure our PSF remains in fact permanent and will continue to support bright futures and opportunities for generations of Texas students."

Blackrock responded: "Today’s unilateral and arbitrary decision by Board of Education Chair Aaron Kinsey jeopardizes Texas schools and the families who have benefited from BlackRock’s consistent long-term outperformance for the Texas Permanent School Fund." 

"The decision ignores our $120 billion investment in Texas public energy companies and defies expert advice. As a fiduciary, politics should never outweigh performance, especially for taxpayers," they added. 

But Derek Kreifels, the CEO of the State Financial Officers Foundation, felt differently, offering support for the termination: "Today’s bold step by Aaron Kinsey and the Permanent School Fund of Texas, in accordance with state law, is a massive blow against the scam of ESG."

"Under Larry Fink's leadership, BlackRock has been misusing client funds to push a political agenda for years. Nowhere was that more egregious than in Texas, where BlackRock was simultaneously trying to destroy the domestic oil and gas industry while managing funds that depended on royalties derived from that very same industry," added Will Hild, the executive director of Consumers' Research.

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He said it was a "clear message" to "Wall Street elites that people can no longer be bullied into complying with ESG's destructive ideology."

By Zerohedge.com 

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