Facts
The facts about Big Finance and climate chaos
Reports, FAQs, and case studies detailing how BlackRock and the financial industry are fuelling a global crisis – and how they can lead change.
SLOW BURN: The asset managers betting against the planet
Reclaim Finance's new scorecard on leading asset managers’ climate commitments, focusing on their approach to the coal sector. Produced with four partner NGOs from across Europe and North America, the report compares 29 asset managers, with a focus on the European market. The authors reveal that despite 16 asset managers holding long-term climate commitments, nearly all are failing to take the first step to making them a reality: exiting coal.
BlackRock’s Net-Zero Commitment Put To The Test
A new report from Reclaim Finance shows that BlackRock, the world’s largest asset manager, holds over $75 billion in thirty major tar sands production companies, all of which plan to develop new reserves of the world’s dirtiest form of oil. BlackRock also holds $3.7 billion in three pipeline companies engaged in the construction of controversial pipelines transporting tar sands oil from Alberta Canada, including Line 3.
One Year On: BlackRock Still Addicted to Fossil Fuels
One year after BlackRock’s CEO promised sustainability would be at the heart of investment decisions, a report by NGOs Reclaim Finance and Urgewald has revealed that BlackRock remains a massive investor in coal companies, even in those with expansion plans related to coal. The analysis unveils huge gaps in BlackRock’s policy, both in its coal policy and in the complete absence of a policy on other fossil fuels.
Fossil Fuel Lobbyists Are Dominating Climate Policies During COVID-19
New research from InfluenceMap shows the oil and gas sector to have dominated climate-related policy battles throughout COVID-19 crisis. Interventions from the industry seeking deregulation and support for fossil fuels in recovery packages have drowned out pro-climate interventions from the non-fossil corporate sector.
The New Money Trust: How Large Money Managers Control Our Economy and What We Can Do About It
This paper will discuss the concerns that the outsized growth of the fund industry, especially its three largest participants, poses for corporate governance, competition, and financial market stability. It then explores some policy solutions to address the financial risks and anticompetitiveimpacts of large asset managers.
How Dodd Frank Can Address Wall Street’s Role In The Climate Crisis
In this paper, Graham Steele argues that a sustainable shift to green energy requires a significant reallocation of this capital and that the Dodd-Frank Act provides the regulatory tools to require financial institutions to internalize the financial risks associated with lending and investments that drive climate change.
What can BlackRock really do, given that it works with client money?
Larry Fink has said that climate change is a major threat to clients’ investments, so continuing to support the companies driving climate change makes BlackRock part of that threat. There is an inherent conflict between the long-term survival of companies whose core business model is based on fossil fuels or deforestation and the long-term existence of life as we know it. Continuing to hold fossil fuel companies in a portfolio is an abdication of long-term fiduciary responsibility. Until it pursues action that aims to materially reduce greenhouse gas emissions, BlackRock is trying to have its cake and eat it, too.
What does Fiduciary Duty mean for BlackRock’s ability to act on climate?
Climate change poses an enormous systemic risk to our economy. So much so that Larry Fink himself said that climate change will reshape finance. Given the systematic threat of climate change, the only way a financial firm can fulfill its long-term fiduciary duty to its clients is by proactively acting to mitigate the climate crisis. Financial firms that do not take the climate impact of their investments into account are not acting in the best interest of their clients or our economy.
Do you expect BlackRock or the economy to change overnight?
Of course not. Change takes time, but we need bold and visionary leadership right now – while we still have a chance to avoid the worst impacts of the climate crisis. We can’t rely on incrementalism while the world burns. Larry Fink says coal won’t disappear tomorrow, but science says we need to stop burning coal as quickly as possible, so funnelling dollars into the industry just pushes us closer to the brink. This all comes down to one simple truth: humanity must avoid catastrophic climate change. Asset managers who publicly acknowledge this truth while propping up companies that drive us toward catastrophe are not leaders or visionaries, and they are certainly not putting sustainability at the center of their investment decisions.
If BlackRock stops investing in fossil fuels and other climate-harming companies, will another investor just step in?
Fewer institutional investors are buying energy stocks, and, for many companies, institutional investors are reducing the size of their fossil fuel holdings. The energy transition, in which global economic growth is increasingly decoupled from fossil fuel use, is underway. As energy stocks have become less relevant, other sectors are moving forward.
What can BlackRock do about its passive investments in companies driving the climate crisis?
True climate leadership must include taking responsibility for avoiding systemic impacts to the financial system and economy overall. BlackRock’s existing portfolio, unchecked, is driving runaway climate change. The notion that passive funds are derived through objective analyses of the market is simply not true, in reality index funds are “passive in name only.” Selection criteria are created by fund managers, and their methodologies shift regularly. It is past time for fund managers to think seriously about how climate change is a crucial criterion.
How are Indigenous rights connected to deforestation and climate change mitigation?
Studies have shown that Indigenous peoples are the best protectors of forests, and that when Indigenous peoples’ rights to autonomy and self-determination are respected, the territories they control remain biodiverse and intact. Given that deforestation is the second largest driver of climate change worldwide following fossil fuel extraction, prioritizing Indigenous rights is a crucial part of protecting the world’s rainforests, which are some of the most important strongholds for climate change mitigation.
Just as BIPOC people have been challenging the white supremacist legacy of slavery in the United States for centuries, Indigenous peoples in the Amazon have been fighting for centuries to defend their ancestral territories from colonialist exploitation and invasion. The exploitation of the Amazon today continues this pattern of colonialism and environmental racism. Almost all of the crude oil and agribusiness industries currently operating in the Amazon are owned and financed by European or U.S. corporations. This is why our work to get major financial institutions like BlackRock to stop financing the destruction of the Amazon is anti-colonialist and anti-racist work.
12 Projects Wrecking Paris
Banks and investors like BlackRock continue to pour billions into the fossil fuel companies developing large-scale, contested coal, oil, and gas expansion projects. In December 2020, on the fifth anniversary of the Paris Climate Agreement, a new report highlighted 12 mega projects that alone will use up 75% of our global carbon budget if we are to limit warming to 1.5 degrees Celsius. BlackRock is the top investor in the report’s coal, oil, and gas companies.
Global Coal
Coal is the world’s deadliest fossil fuel, damaging people’s health, destroying local ecosystems, and acting as the number-one driver of climate change worldwide. All scenarios aiming to keep the world at a safe temperature – including the Paris Agreement – involve rapidly phasing out coal.
Amazon deforestation
The Amazon is the world’s largest rainforest. It’s critical for biodiversity and climate regulation, because it ‘pumps’ water into the air (like a heart) to produce rain and cool the earth. The Amazon is the world’s largest carbon sink, storing an estimated 150-200 billion tons of carbon. It also houses at least 10% of the planet’s known biodiversity, and is home to over 400 distinct groups of Indigenous peoples, who have protected this crucial ecosystem for centuries.
Pipeline: TC Energy and Keystone XL
TC Energy, formerly known as TransCanada, has been attempting to build the Keystone XL tar sands pipeline since 2008. For over a decade, Indigenous leaders, water protectors, environmentalists, ranchers, and lawyers have been resisting the project, engaging in direct actions, and waging a series of legal battles challenging the construction of the controversial pipeline.
Pipeline: Enbridge and Line 3
Enbridge Inc. has a track record of oil spills and Indigenous rights violations. The company has been pushing to replace its existing Line 3 pipeline with a larger pipe that would carry 760,000 barrels of tar sands oil per day from Edmonton, Alberta, to Superior, Wisconsin. In November 2020, Enbridge secured final permits for Line 3 from Minnesota and the federal government and began construction in December, despite COVID risks, legal challenges, and sustained Indigenous-led opposition to the project. When construction started, BlackRock had $336 million invested in Enbridge.
Tar Sands & Pipelines
The Northern Alberta tar sands are the third-largest fossil fuel reserve on earth. Tar sands oil is fused within underground soil deposits, making its extraction extremely destructive by digging through kilometers of boreal forest, and water and energy-intensive by separating the oil from the soil using steam injected underground. BlackRock has billions of dollars invested in tar sands companies.