➞ As the financial world wakes up to the climate crisis, it should understand that addressing the crisis is as much a human rights issue as an environmental one.
➞ Following sustained pressure from activists, BlackRock CEO Larry Fink announced last month that his firm would place climate at the center of its investment strategy. The declaration, which included a decision to divest from coal in $1.8 trillion of actively managed funds, sent shockwaves through the investment world.
➞ The move conveys a clear message that business as usual is no longer viable. But climate justice is as much about defending basic human rights as it is about protecting the planet — and BlackRock’s record on either isn’t very convincing.
Commentary by Gaurav Madan on 26 February 2020
A forest in Brazil is set on fire to make way for soy plantations. An oil pipeline leak in South Dakota threatens the drinking water of local communities. A Honduran family seeking a better life is tracked by immigration agents and locked up in a detention center.
A common denominator in these frightening realities of our brave new world? They are all financed by Wall Street investors — including the biggest, BlackRock.
Following sustained pressure from activists, last month, Larry Fink, CEO of Wall Street giant BlackRock, announced that his firm would place climate at the center of its investment strategy. The declaration, which included a decision to divest from coal in $1.8 trillion of actively managed funds, sent shockwaves through the investment world. The move conveys a clear message that business as usual is no longer viable.
But, as the financial world wakes up to the climate crisis, it should understand that addressing the crisis is as much a human rights issue as an environmental one.
Despite its resounding announcement on coal, which ultimately covers less than 20% of the industry, BlackRock remains the largest investor in fossil fuels and deforestation — the two biggest contributors to climate crisis. We are already witnessing how global warming-induced droughts and crop failures are driving increased migration. As temperatures rise and extreme weather events intensify, how the world responds to climate migration will be one of the defining human rights issues of our time.
Following its January announcement on climate, BlackRock released a new statement on its engagement with agribusiness — the industry destroying the world’s last standing forests and fueling widespread violence against local, often indigenous, communities. Notably, BlackRock is one of the largest investors in palm oil, soy, cattle, and pulp and paper, the commodities that are responsible for 80 percent of deforestation worldwide, as well as a global epidemic of violence against land defenders from Brazil to Borneo. On average, three land and environmental defenders are killed every week, with agribusiness ranked as the second deadliest sector. While BlackRock recognizes the inherent risks posed by agribusiness, its new statement falls short in elucidating how it will hold companies accountable for the myriad social and environmental violations stemming from the sector, including deforestation, land grabbing, and human rights abuses.
To date, BlackRock has failed to acknowledge its role in bankrolling companies that are complicit in cutting down the world’s remaining forests, assassinating indigenous leaders, or detaining and deporting refugees and asylum seekers.
Climate justice is as much about defending basic human rights as it is about protecting the planet — and BlackRock’s record on either isn’t very convincing.
In 2019, BlackRock voted against all U.S. shareholder proposals backed by the Climate Action 100+ investor coalition and supported 99 percent of management-nominated directors at U.S. fossil fuel companies. Its shareholder voting record on human rights was even worse. Friends of Earth’s review of BlackRock’s human rights votes indicates that BlackRock systematically voted against 100 percent of human rights resolutions ranging from prison labor to hate speech to sexual harassment.
Investors often claim that engagement with companies must remain confidential; yet when it comes to issues of climate and human rights, there is often very little to show for their efforts. If BlackRock is pushing companies to be better on human rights, why doesn’t it disclose this information and share the human rights standards it uses to evaluate companies?
BlackRock’s regressive record on human rights isn’t limited to its votes. The Wall Street giant is a direct investor in Palantir — a private data analytics firm that provides software to the US’s Immigration and Customs Enforcement (ICE) agency to facilitate the mass detention and deportation of immigrants. Palantir has enabled the Trump administration’s human rights violations and anti-immigrant agenda by weaponizing its data systems to conduct mass raids, separate families, and terrorize immigrant communities.
Essentially, BlackRock is fueling climate crisis and migration, and then, through its investments in companies like Palantir, is reaping profits from migrant detention.
As the climate justice movement sharpens its focus on financial institutions, sustained pressure has succeeded in pushing BlackRock to assess its own social purpose. Now BlackRock says it’s reshaping its financial model to reckon with climate risk. If it’s serious, it will need to examine the human rights implications of the climate crisis. An entire movement is watching to see what it does to clean up its act on fossil fuels, deforestation, and human rights.
Gaurav Madan is Senior Forests and Lands Campaigner at Friends of the Earth US.