Major Financial Corporations Exit Climate Investment Coalition

Written by Nick Pope on February 20, 2024. Posted in Current News

Several of the largest asset managers in the U.S. are withdrawing from a major coalition of companies focused on advancing ‘green’ investment strategies and climate-sensitive corporate management

JPMorgan Asset Management (JMAM) and State Street Global Advisors will not be renewing membership in Climate Action 100+, a coalition of investors and asset managers with a combined $68 trillion under management that pushes corporations to reduce emissions and adopt climate risk disclosure practices, according to Financial Times.

BlackRock — the largest asset manager in the world — is scaling back its involvement with Climate Action 100+, withdrawing from the coalition as a corporate member but staying involved through its smaller international arm.

Climate Action 100+ and Ceres — a ‘green’ shareholder activist group that co-founded the coalition — are currently under investigation by the House Judiciary Committee, which is alleging that the coalition’s advancement of progressive Environmental, Social and Corporate Governance (ESG) policies may constitute non-competitive activity in violation of U.S. antitrust law.

JPMAM has about $3.1 trillion under management, according to Financial News, while State Street controlled about $3.7 trillion in assets as of September 2023 and BlackRock manages assets worth about $9 trillion. All three firms joined Climate Action 100+ in 2020.

“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,” House Judiciary Committee Chairman Jim Jordan wrote of the withdrawals in a statement posted to X, formerly Twitter.

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

JPMAM has built up a team of about 40 professionals who specialize in ‘sustainable’ investing, providing it the ability to pursue its own climate-oriented strategies, a JPMAM spokesperson told Financial News.

“Given these strengths and the evolution of its own stewardship capabilities, JPMAM has determined that it will no longer participate in Climate Action 100+ engagements,” the spokesperson told Financial News.

JPMAM and State Street are the latest major Western firms to drop out of climate-oriented corporate initiatives.

Vanguard, another massive asset manager, withdrew from the Net Zero Asset Management initiative in 2022, while major insurers including Lloyd’s of London, Allianz, and Axa all pulled out of the Net-Zero Insurance Alliance in 2023, according to Reuters.

“After careful review, State Street Global Advisors has concluded the enhanced Climate Action 100+ Phase 2 requirements for signatories will not be consistent with our independent approach to proxy voting and portfolio company engagement,” a spokesperson for State Street told the Daily Caller News Foundation.

“As a result, we have decided to withdraw from Climate Action 100+.”

See more here climatechangedispatch

Header image: The Financial Times

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