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. (RELATED: EXCLUSIVE: Jim Jordan, House Republicans Launch Investigation Into BlackRock, Vanguard, Others Over ESG Practices)
🚨EXCLUSIVE🚨 via @henryrodgersdc
House Judiciary Chairman Rep. @Jim_Jordan , @RepDanBishop Threaten Subpoena Of ESG ‘Cartel’
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“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.
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+.”
BlackRock, which did not fully withdraw from the coalition as JPMAM and State Street did, had arrived at the decision to change its level of engagement with Climate Action 100+ a few weeks ago, a spokesperson for the company told the DCNF.
“BlackRock has also changed its relationship with Climate Action 100+ as a result of changes Climate Action 100+ has made to its strategy. BlackRock became a signatory to Climate Action 100+ in Q1 2020, at a time when Climate Action 100+ was focused on corporate disclosure,” a note from BlackRock regarding the change of its relationship with Climate Action 100+ reads. “In June 2023, Climate Action 100+ published its phase 2 strategy which comes into effect in June 2024. This new strategy will require signatories to make an overarching commitment to use client assets to pursue emissions reductions in investee companies through stewardship engagement. In our judgment, making this new commitment across our assets under management would raise legal considerations, particularly in the U.S.”
Climate Action 100+ does not comment on the circumstances surrounding individual departures from its ranks, a spokesperson told the DCNF.
JPMAM did not respond immediately to a request for comment.
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