Not just ESG: because Bluebell wants to oust Fink from the BlackRock giant
The small activist fund Bluebell accuses the giant BlackRock of hypocrisy on ESG and calls for the removal of the long-time CEO Larry Fink. All the details
Small activist fund Bluebell Capital Partners has asked New York-based BlackRock – the world's largest investment firm – to remove CEO Larry Fink, accusing him of still being too focused on fossil fuels despite the global trend towards decarbonization.
WHAT BLUEBELL CAPITAL PARTNERS DOES
Bluebell Capital Partners is a fund based in London, focused on the European market and on ESG, those sustainability factors that evaluate the environmental ( environmental ), social ( social ) and managerial ( governance ) impact of an investment. It was founded in 2019 by two Italians, Giuseppe Bivona and Marco Taricco, both with a long career behind them in large investment banks such as Goldman Sachs and Morgan Stanley.
Despite its size, Bluebell has waged battles against large companies such as Swiss financial group Richemont ( it aimed to have Francesco Trapani on the board of directors) or French telecommunications group Vivendi (to get better dividends from the Universal Music Group spin-off).
Bluebell is a shareholder of BlackRock with a minimum stake of 0.01 percent.
THE (OPPOSITE) CRITICISM OF BLACKROCK IN THE UNITED STATES
In the United States BlackRock is indeed receiving a lot of criticism, but of a contrary nature: Republican politicians (above all) accuse the company of pursuing an investment policy focused more on the principles of sustainability than on actual economic returns.
According to Bluebell, however, Fink's attention to ESG factors is not reflected in practice, because BlackRock continues to invest in assets related to fossil fuels – it is a shareholder of the main American companies that export liquefied gas , for example -, including coal, the most polluting of all.
The state of Florida last week announced the withdrawal of approximately $2 billion from BlackRock funds in protest of its ESG policies. By October , Louisiana had withdrawn nearly $800 million. And in late August, the Texas public accountant accused BlackRock of carrying out a boycott of energy companies, prohibiting local Texan agencies and governments from signing contracts with them.
WHAT THE BLUEBELL LETTER SAYS
In a long, 15-page letter sent Nov. 10 to BlackRock's board of directors, Bluebell says she, as a shareholder, is "increasingly concerned about reputational risk (including greenwashing risk) to which you have unreasonably exposed the company, potentially fueling a gap between 'saying' and 'doing' on ESG investing.
The fund accuses BlackRock – among other things – of not having put pressure on the Belgian chemical company Solvay regarding the spilling of waste from the Rosignano plant into the Mediterranean and of not having supported the initiative to remove Alessandro Profumo as CEO di Leonardo following his conviction for false accounting.
Bluebell has asked the BlackRock board to carry out a strategic review of the company's ESG policy to resolve and eliminate the inconsistencies. The fund also wants Larry Fink removed as chief executive officer, while he could retain that of chairman.
BLACKROCK'S ANSWER
In a statement, BlackRock said that, over the past 18 months, Bluebell has carried out a series of activist campaigns to promote its climate and governance agenda. The New York company specified that it did not support them "because we did not consider them to be in the economic interest of our customers".
Fink is 70 and co-founded BlackRock in 1998 and has held the position of CEO ever since. Since 2000, the company's shares have averaged annual gains of 22 percent, much higher than the average of +7.5 percent of the S&P 500 index, which tracks the performance of the five hundred largest US companies.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/non-solo-esg-perche-bluebell-vuole-cacciare-fink-dal-colosso-blackrock/ on Wed, 07 Dec 2022 14:34:36 +0000.