News Analysis

World’s biggest investor values quality boards and ESG

by Stephen Conmy on Mar 27, 2023

BlackRock, the world’s largest asset manager and investor, said it would continue to invest in companies with ‘quality boards’ and good environmental, social and governance (ESG).

BlackRock Inc, the world’s largest asset manager and investor, will continue to ask companies about their ESG standards and how they treat ‘material’ climate-related risks.

BlackRock has recently come under fire in the US for what Republican’s called their move towards ‘woke capitalism’.

Republicans say BlackRock focuses too much on environmental, social and governance (ESG) factors.

However, some shareholder activists and investors say BlackRock – which has $8.6 trillion in assets to invest – should challenge companies to do more to address climate change.

Read more: A simple guide to ESG

Board quality is vital

BlackRock said in a statement that while it has ‘refined’ its language around ESG, its investment framework has remained the same. It said it would continue to focus on topics like:

  • Board quality and effectiveness; 
  • A company’s strategy, purpose and financial resilience; 
  • Executive incentives; 
  • Climate-related risks;
  • Natural capital; 
  • And a company’s impact on people, particularly its workers. 

BlackRock CEO Larry Fink said while the investment firm has been vocal and told portfolio companies what it likes to see in practice, “it’s not our place to be telling companies what to do.”

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