Tennessee Attorney General Jonathan Skrmetti on Friday celebrated a legal settlement between the State of Tennessee and BlackRock, Inc., which resulted in the company changing its policies related to Environment, Social, and Governance investing.
“Tennessee beats ESG,” wrote Skrmetti in a post to the social media platform X containing a link to the settlement. “BlackRock’s stringent obligations under this settlement ensure Tennesseans will not see their retirement funds used to support radical ideologies they oppose.”
The attorney general wrote, “Transparency and accountability guarantee customers an informed choice.”
Tennessee beats ESG!
BlackRock's stringent obligations under this settlement ensure Tennesseans will not see their retirement funds used to support radical ideologies they oppose.
Transparency and accountability guarantee consumers an informed choice.… pic.twitter.com/x49nE5BFFO
— TN Attorney General (@AGTennessee) January 17, 2025
In the nine-page settlement, BlackRock agreed to disclose which of its funds are explicitly focused on ESG, remove ESG ratings and sustainability data from certain funds, conduct independent audits regarding its ESG initiatives, disclose its membership in climate change organizations, among other concessions to Tennessee.
Skrmetti’s office, in a press release, said the settlement will give “investors greater insights into decision-making rationales,” and highlighted BlackRock’s commitment to strengthen its consideration of their investors’ financial gains when making decisions for funds that solely have financial objectives.
The attorney general sued BlackRock last year, when he told Michael Patrick Leahy, the editor-in-chief of The Tennessee Star, that the lawsuit was “a simple consumer protection case,” as the company, “both said that they were going to maximize return on investment and they said that they were going to use every asset under their management, they have about nine trillion dollars under management, to advance environmental causes.”
He added, “You can’t do both,” stating, “You’re either looking at nothing but return on investment or you’re mixing that with some other preference and consumers need to know which philosophy will manage their assets.”
At the time, Skrmetti predicted BlackRock’s “very expensive attorneys” would present “a fight” for the attorney general.
A BlackRock spokesman told The Star the company is “pleased to resolve this matter,” and said it “has consistently acted in the interests of our clients.” In a nod to the audits agreed to in the settlement, the spokesman said BlackRock looks look forward to demonstrating “that fact through even greater transparency about our practices.”
Skrmetti celebrated another legal victory late last year when the Biden-Harris administration voluntarily withdrew its changes to Title IX that would have required schools to allow biological men who identify as transgender men to compete alongside biological women.
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Tom Pappert is the lead reporter for The Tennessee Star, and also reports for The Pennsylvania Daily Star and The Arizona Sun Times. Follow Tom on X/Twitter. Email tips to [email protected].
Photo “Jonathan Skrmetti” by Tennessee Attorney General. Background Photo “Exterior of BlackRock” by Americasroof. CC BY-SA 3.0.
Editor’s note: This article was updated to include a comment by a BlackRock, Inc. spokesperson about the settlement with the state of Tennessee.
