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CV NEWS FEED // Texas has ended a $8.5 billion education contract with New York City-based investment giant BlackRock over the firm’s embrace of left-wing environmental, social, and governance (ESG) policies.
Texas State Board of Education Chairman Aaron Kinsey explained the Texas Permanent School Fund’s (PSF) decision in a Tuesday statement to FOX Business.
“[PSF] 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,” Kinsey stated. “Terminating BlackRock’s contract ensures PSF’s full compliance with Texas law.”
FOX Business explained that Kinsey was referring to a “2021 state law that seeks to distance the state and its large public purse from financial institutions boycotting the oil and gas sector.”
Texas is the state with by far the largest oil and gas industry. In 2022, the Lone Star State accounted for 42.5% of the country’s crude oil production – more than three times the share of second-place New Mexico.
The same year, Texas produced about a quarter of the nation’s natural gas – also the most of any state.
Kinsey continued:
BlackRock’s dominant and persistent leadership in the ESG movement immeasurably damages our state’s oil [and] 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.
Republican Texas Gov. Greg Abbott appointed Kinsey, also a Republican, to his position in December.
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In a statement emailed to Bloomberg, a BlackRock spokesperson blasted Texas’ decision:
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.
Bloomberg reported that “BlackRock has always maintained it does not engage in any boycott.”
According to FOX Business, “[t]he ESG movement, which has picked up steam in recent years, calls for investments to be pulled from traditional energy industries and diverted to green energy industries in the fight against global warming.”
Last year, BlackRock co-founder and CEO Larry Fink told FOX Business that he “[doesn’t] say [the term ‘ESG’] anymore.” He said the acronym has been “weaponized by the far left and weaponized by the far right.”
“And we lose the conversation,” Fink said.
Fink is a Democrat, although he has donated large sums of money to both Democratic and Republican political candidates. He sits on the Board of Trustees of the controversial World Economic Forum (WEF).
