Seventeen U.S. state officials are urging BlackRock, State Street, and others to stay committed to ESG investing. The letter warns against abandoning long-term sustainability goals due to political pressure.
“We expect you to act in the best interest of long-term investors,” the officials wrote.
Who’s Involved?
- BlackRock
- State Street Global Advisors
- JPMorgan Asset Management
- Vanguard (mentioned but not directly addressed)
These firms manage trillions in assets. Their ESG policies affect pension funds, endowments, and sovereign wealth portfolios.
What’s the Pressure?
1. Political Backlash
Some states oppose ESG investing. They claim it prioritizes ideology over returns. Others argue ESG is essential for long-term risk management.
“ESG is not politics. It’s prudent investing,” said Illinois Treasurer Michael Frerichs.
2. Market Volatility
2025 has seen mixed ESG fund performance. Some funds underperformed. Others outpaced benchmarks. This creates confusion for retail and institutional investors.
3. Legal Threats
States like Texas and Florida have proposed anti-ESG legislation. These laws could limit public fund access to ESG-aligned managers.
📊 What’s at Stake?
| Asset Manager | ESG AUM (2025) | States Challenging |
| BlackRock | $2.3 trillion | TX, FL, MO, LA |
| State Street | $1.1 trillion | KY, GA, OK |
| JPMorgan | $900 billion | AL, MS, SC |
Source: Morningstar ESG Tracker
Why You Should Care
- Pension Funds rely on ESG screens to reduce long-term risk.
- Youth-focused campaigns often align with ESG values.
- Corporate CSR strategies are built around ESG metrics.
If asset managers retreat, climate, diversity, and governance goals may suffer.
“We need capital to support sustainable growth,” said ESG strategist Priya Desai.
What Industry is Gossiping?
- Michael Posner, NYU Stern: “BlackRock’s ESG retreat is a mistake. It weakens investor trust.”
- Semafor Editorial Board: “Asset managers must balance fiduciary duty with social responsibility.”
- ESG Today Panel: “The backlash is loud, but the data still supports ESG.”
In conclusion
ESG investment pressure is rising. Asset managers must decide whether to stand firm or retreat. The stakes are high. Investor trust, climate goals, and social equity depend on these decisions.“This is not just about returns. It’s about responsibility,” said Frerichs.
