Asset Managers Drop Out of Climate Pact

JPMorgan Chase’s asset management arm and State Street Global Advisors withdrew from a climate pact.

The pact, called Climate Action 100+, is an “investor-led initiative to ensure the world’s largest corporate greenhouse gas emitters take necessary action on climate change.”

“Over 700 investors, responsible for $68 trillion in assets under management, are engaging companies on improving climate change governance, cutting emissions and strengthening climate-related financial disclosures, in order to create long-term shareholder value,” a description of the pact reads.

“CA100+ will seek to ensure equality, diversity and inclusion are reflected in the composition of the Steering Committee,” it adds. “Where practical, investor representatives will be invited to join taking into consideration their level of engagement in the initiative and endeavouring to maintain a Steering Committee that encompasses a sufficient mix of relevant skills, competence, and diversity of perspectives; including but not limited to geographical diversity of signatory representation and diversity of geographical origin, types of investment institution, ethnicity, language, culture, and gender.”

Representative Jim Jordan (R-OH) wrote on X that the asset managers’ decision to withdraw from the pact was a “big win.”

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. https://t.co/PT3LlDjMSa

— Rep. Jim Jordan (@Jim_Jordan) February 15, 2024

Last year, 21 attorneys general criticized asset managers for prioritizing political goals over Americans’ financial interests.

“Simply put, you are not the same as political or social activists and you should not be allowing the vast savings entrusted to you to be commandeered by activists to advance non-financial goals,” the letter said, adding, “Many asset managers, however, have made commitments that cast doubt on their adherence to fiduciary requirements, representations to consumers about their services, and compliance with antitrust laws.”

In June, Larry Fink, the CEO of BlackRock, publically expressed his discomfort with the ongoing political tug-of-war over ESG (environmental, social, and governance) factors in investment.

“I’m not going to use the word ESG because it’s been misused by the far left and the far right,” he remarked, instead suggesting replacing the term with phrases related to specific issues like “decarbonization,” “governance,” and “social issues” which are the same components of “ESG.”