The worldwide manager of trillions of dollars worth of assets announced future cuts to its workforce on Tuesday.
BlackRock, an American multinational investment company, will lay off roughly 600 employees, or about 3% of its workforce. The announcement on January 9 comes ahead of the company reporting its Q4 2023 results, which is scheduled for January 12. BlackRock posted a drop in assets under management from $9.4 trillion in Q2 2023 to $9.1 trillion in Q3 2023.
The company has found itself not only targeted in an investigation by Congress for allegedly enabling U.S. investment into prohibited Chinese companies but also embroiled in controversy after its CEO Larry Fink touted his company’s investment strategy based on a philosophy of environmental, social, and governance (ESG) investing that favors renewable energy investments and advancing leftist social policies, as reported previously in The Dallas Express.
Approximately $6 billion in assets were taken from BlackRock’s hands after states such as Louisiana, Missouri, and Florida pulled their investments over ESG policies. Detractors claim that ESG directs funds based on political agendas rather than pragmatic business decisions, which is to the detriment of stakeholders.
Fink would eventually backtrack regarding his support of ESG while speaking at the Aspen Ideas Festival. He claimed that rather than intending his ESG stance to be a political statement, he had sought to wield the philosophy “to identify longterm issues to our longterm investors,” as covered in The Dallas Express.
BlackRock’s upcoming layoffs are reportedly affecting its ESG division most of all, but this has yet to be confirmed by the company’s leadership. Fox Business reported that ESG guidelines have nonetheless been pulled back considerably at the firm, with U.S. portfolio managers no longer required to use ESG metrics.
As The Dallas Express reported, the City of Dallas will include ESG in its deliberation of how to allocate funds in the upcoming $1.1 billion bond package, as well as ESG metrics in its public reports on the bond issuance. Ultimately, Dallas residents will vote on the city council’s finalized bond program.
In Texas, lawmakers deliberated on several anti-ESG laws last year but passed just one, which bars insurance providers from considering ESG criteria when establishing rates.
