BlackRock and Vanguard drastically scale back support of ESG projects like 'racial equity' and 'reproductive rights'

The Vanguard Group has joined fellow investment giant BlackRock in drastically reducing the number of projects it plans to fund that are under the environmental, social, and corporate governance umbrella.

BlackRock, the world's largest money manager, reported a massive scale-back in ESG-related backings in late August 2023, according to the Epoch Times.

The group said that it has recently backed about 7% of ESG proposals at company meetings the last 12 months leading up to June 2023. In 2022, that number was 22%, and in 2021 the company reportedly voted in favor of nearly half of all ESG proposals.

For better or for worse, BlackRock CEO Larry Fink said in June 2023 that he would no longer use the term "ESG" because it has been "weaponized by the far left and the far right."

"I don't use the word ESG anymore, because it has been entirely weaponized," Fink stated.

"I'm a big believer that you have to focus on all your stakeholders," he added. "But I'm not going to use the word ESG because it has been misused."

BlackRock denied attacks that it was succumbing to right-wing pressure and said it was "solely to advance the financial interests of our clients."

Vanguard made similar moves and chose to back only 2% of ESG proposals at meetings across the United States, despite a large increase in the number of ESG-related proposals that were pitched.

Vanguard stated that shareholders submitted 359 ESG proposals for 2023 and 290 in 2022.

"The funds supported just 2 percent of such proposals in the 2023 proxy year, down from 12 percent in the 2022 proxy year," the investment advisors said.

The company reported that 274 proposals were related to social issues such as "racial equity, reproductive rights, and pay gaps, with several notable proposals in the sector concerning unionization and worker safety."

Vanguard also chose to leave a coalition of Net Zero Asset Managers in December 2022, which was reportedly seen as a result of 13 Republican states asking the FERC to block them from buying publicly traded shares from electricity providers.

Attorney generals from Alabama, Arkansas, Indiana, Kentucky, Louisiana, Mississippi, Montana, Nebraska, Ohio, South Carolina, South Dakota, Texas, and Utah were in the mix.

"After a considerable period of review, we have decided to withdraw," Vanguard said. The move was allegedly to "provide the clarity our investors desire about the role of index funds and about how we think about material risks, including climate-related risks."

There is no doubt that this shift will be seen as a temporary victory for right-leaning politicians and supporters, even as the Biden administration continues its own funding of climate initiatives.

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