Treasurer pulls Louisiana investments out of BlackRock

Schroder says firm is breaking Louisiana law with its environmental focus

By: - October 5, 2022 7:48 pm
Aerial view of Louisiana State Capitol building

(Photo credit: Wesley Muller/Louisiana Illuminator)

Louisiana State Treasurer John Schroder said Wednesday he is divesting all state treasury funds from BlackRock Inc., the world’s largest asset manager, accusing the company of violating state law with respect to its fiduciary duty.

In a press release, Schroder said his action is in response to recent reports that BlackRock has urged companies to embrace environmental, social and governance (ESG) investment strategies. Schroder believes such strategies would harm Louisiana’s fossil fuel industries and violate state law.

“ESG investing violates Louisiana law on the fiduciary duties which require a sole focus on financial returns for the beneficiaries of state funds,” Schroder wrote. “A focus on political or social goals or placing those goals above the duty to enhance investors’ returns is unacceptable under Louisiana law.”

BlackRock, which has 70 offices in 30 different countries, came under fire last year when billionaire investor George Soros criticized the firm for its investments in China. 

In a Wall Street Journal op-ed, Soros wrote that BlackRock’s initiative in China would “damage the national security interests of the U.S. and other democracies.”

In response, the company told CNBC that its investment activity would “contribute to the economic interconnectedness of the world’s two largest economies.”

Schroder did not mention BlackRock’s China initiative in his announcement Wednesday.

There was no immediate response from BlackRock on the decision from Schroder, who is considering a run for Louisiana governor.

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Wesley Muller
Wesley Muller

Wes Muller traces his journalism roots back to 1997 when, at age 13, he built and launched a hyper-local news website for his New Orleans neighborhood. In the years since then, he has freelanced for the Times-Picayune in New Orleans and worked on staff at the Sun Herald in Biloxi, WAFB-9News CBS in Baton Rouge, and the Enterprise-Journal in McComb, Mississippi. He also taught English as an adjunct instructor at Baton Rouge Community College. Among his recognitions are McClatchy's National President's Award, the Associated Press Freedom of Information Award, and the Daniel M. Phillips Freedom of Information Award from the Mississippi Press Association. Muller is an alumnus of Jesuit High School and the University of New Orleans and is a veteran U.S. Army paratrooper. He lives in Louisiana with his wife and two sons.

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