Critics of ESG argue that such investment policies are often arbitrary and can hurt a company’s bottom line. They also claim that ESG measures can be manipulated. For instance, companies such as Tesla have received a high ESG score under one metric while they rate poorly on another.
"Rather than being a spectator betting on the game, BlackRock appears to have put on a quarterback jersey and actively taken the field," the AGs wrote. "As a firm, Blackrock has committed to implementing an ESG engagement and voting strategy across all assets under management."
For instance, BlackRock joined the Net Zero Managers Alliance (NZAM), which directs members to “acknowledge that there is an urgent need to accelerate the transition towards global net zero emissions and for asset managers to play our part to help deliver the goals of the Paris Agreement,” the AGs noted.
“Under our state laws, the desired 'dialogue' regarding any potential energy transition would be how to maximize financial returns, which would potentially include the opportunistic purchasing of fossil fuel assets discarded by companies seeking to meet net zero commitments,” the AGs said.