These companies are:
- black rock
- BNP Paribas
- Credit Suisse Group
- Danske Bank
- Jupiter Fund Management
- Nordea Bank
- Schroders PLC
- Svenska Handelsbanken
- UBS Group
Nearly 350 investment funds from various companies were listed in the second appendix to the controller’s report listing and will also be subject to the assignment order.
“The environmental, social and corporate governance (ESG) movement has produced an opaque and perverse system in which some financial companies no longer make decisions in the best interests of their shareholders or customers, but instead use their financial clout to push a social and political agenda shrouded in secrecy,” Comptroller Glenn Hegar said in a statement.
“Our review focused on the boycott of energy companies, rather than the entire ESG movement. This research revealed a systemic lack of transparency that should concern every American, regardless of political persuasion, particularly the use of doublespeak by some financial institutions as they publicly engage in anti-oil and gas rhetoric, while telling a much different story behind closed doors.
The list will be a running tally that can add or remove entities as developments occur as frequently as quarterly.
“State government entities subject to the law’s investment prohibitions and divestment requirements include: Texas Employees’ Retirement System, Texas Teachers’ Retirement System, Texas Municipal Retirement System, the Texas County and District Retirement System, the Texas Emergency Services Retirement System, and the Continuing School Fund,” the statement read.
State entities have 30 days to inform the comptroller of their stakes in each offending company.
The process of reducing a list of offenders was launched last November when Hegar joined 14 other state tax officials in a letter to US banks, threatening to withdraw dollars from states if they refuse funding for the fossil fuel industry.
In March, the comptroller published a preliminary list of 19 companies that fall into the category of fossil fuel divestment policies. Letters have been sent to these companies asking for clarification; half of these entities were on the final list.
His office sent a letter to 150 other companies about individual funds being offered that reject fossil fuel investments.
The directive derives from Senate Bill 13, passed by the legislature last year, which tasks the comptroller with identifying companies that boycott fossil fuels and removing any public investment from their portfolios. The other part of SB 13, which has been in effect since its adoption, is that state entities are prohibited from signing new or renewed contracts with any company that does not certify that it is not “boycotted”. .[ing] energy companies.
In January, Lieutenant Governor Dan Patrick call for BlackRock will be placed “at the top of the list” of companies boycotting fossil fuels after CEO Larry Fink’s statements about “decarbonizing[ing] the economy.”
BlackRock has repeatedly refuse accusations of fossil fuel divestment, but the comptroller’s investigation decided otherwise.
“We do not agree with the controller’s opinion. It is not a judgment based on facts,” said BlackRock The Texan in a report. “BlackRock is not boycotting fossil fuels – investing over $100 billion in Texas energy companies on behalf of our customers proves it.”
“Elected and appointed public officials have a duty to act in the best interests of the people they serve. Politicizing public pension funds, restricting access to investments and having an impact on the financial returns of retirees, is not in line with this obligation. Texans deserve access to the full range of asset managers and investment opportunities that can help them achieve their retirement goals. We are proud to play our part.
While Hegar’s announcement targets only one aspect of the broader ESG movement to sanction and divest from fossil fuel producers, state officials have more and more placed in his crosshairs.
State Representative Steve Toth (R-The Woodlands) announcement in May that he will introduce a bill prohibiting banks operating in Texas from denying financing to fossil fuel companies based on the product they create. Similar legislation was passed last year with the same concept but for firearms manufacturers.
Texas Attorney General Ken Paxton also announcement an investigation, in conjunction with other state attorneys general, of BlackRock over statements about ESG and the transition to a net-zero energy future. BlackRock – along with State Street, Vanguard and Institutional Shareholder Services – is being investigation by the Texas Senate Committee on State Affairs on similar grounds.
Earlier this year, the Texas Employee Retirement System proxy vote in favor of various corporate proposals at US banks banning new fossil fuel financing. The pension fund said it was a communication error by the entity’s proxy service, Institutional Shareholder Services. The pension later said it would fix the problem.
“My greatest concern is the false narrative that has been created by environmental crusaders in Washington, D.C. and Wall Street that our economy can completely move away from fossil fuels, when in fact they will be part of our daily lives for the foreseeable future,” Hegar said.
“A complete divestment from the industry is not only impractical and illogical, but is counter to the economic well-being of Texas and our citizens.”