BlackRock will more than double the number of companies it engages with over climate-change concerns next year, meaning more of the biggest polluters face voting action from the world’s largest asset manager if they fail to take action.
In its stewardship expectations for 2021 report, published on 10 December, BlackRock said it will increase the number of carbon-intensive companies it engages with to more than 1,000 next year. That is an increase from the 440 companies BlackRock said in January it would take tougher action against over climate-risk failures.
The US-headquartered investor earlier this year put 191 companies “on watch” for their failure to address climate risks. BlackRock warned management they could face consequences if they fail to make progress on reducing carbon emissions and moving towards more sustainable business models.
Companies within its expanded scope operate in sectors including communication services, consumer discretionary, consumer staples, energy, financials, healthcare, industrials, information technology, materials, real estate and utilities.
The firms represent 90% of so-called global scope 1 and 2 emissions, which originate directly from a company, or indirectly from the consumption of electricity or gas.
“We communicated our position throughout the past year and expect companies to demonstrate how climate and sustainability-related risks are considered and integrated into their strategy,” BlackRock said in its report. “If a company does not provide adequate public disclosures for us to assess how material risks are addressed, we will conclude that those issues are not appropriately managed and mitigated.”
BlackRock, which oversees $7.8tn of assets, is not the only fund manager to intensify pressure on major polluters.
In October, Legal & General Investment Management said it would publish its climate ratings for 1,000 companies on its website.
The UK’s largest investment manager, which has more than £1tn in assets, said it was broadening its climate-impact pledge to track more than 1,000 companies with the aim of achieving net-zero carbon emissions globally by 2050. The revised list marks a more than 10-fold increase in the number of companies covered.
Read more on: Financial News London
