A Texas school fund told BlackRock on Tuesday it was terminating its contract to manage around $8.5 billion of state money, accusing the investment giant of boycotting fossil fuel energy producers, who represent a large part of the state’s industry.

BlackRock has denied it is engaged in any boycott, saying the money pulled is a tiny sliver of the $10 trillion in assets that it manages.
The move by the Texas Permanent School Fund, however, highlights how BlackRock and other asset managers continue to attract controversy in some Republican-run states over environmental, social and corporate governance (ESG) investing.
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Texas State Board of Education Chair Aaron Kinsey, who administers the fund, said its relationship with BlackRock breached state law against investing with companies accused of boycotting energy companies.
Kinsey told Reuters that the fund was complying with a 2021 Texas law obliging state agencies to divest from fund managers like BlackRock that shed investments to reduce greenhouse gas emissions.

Source: Reuters

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