ESG proponents adopt new language for investment considerations (2024)
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BlackRock—the world’s largest asset manager, with roughly $10 trillion in assets under management—announced last week that it will focus on supporting what the firm calls financial resilience as it relates to mitigating risks related to environmental, social, and governance factors. The announcement signaled a further move away from terms like ESG and sustainability in the company’s public communications. BlackRock CEO Larry Fink previously said last year the firm would stop using the term ESG to refer to environmental, social, and governance considerations.
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BlackRock will stress 'financial resilience' in its talks with companies this year as the $10tn asset manager puts less emphasis on climate concerns amid a political backlash to environmental, social and governance investing. With artificial intelligence and high interest rates rattling companies globally, BlackRock wants to know how they are managing these risks to ensure they deliver long-term financial returns, the asset manager said on Thursday as it detailed its engagement priorities for 2024. … While BlackRock’s overall priorities rarely change, the 2024 report dropped references to 'global warming' that had been included in previous years, including a reference to companies adapting to a world 'in which global warming is limited to well below 2C'.[1] |
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Meanwhile, at the annual gathering of the World Economic Forum in Davos, Switzerland, participants also discussed ways to change how ESG factors are discussed:
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Their discussions this week might involve companies trading tricks for how to 'evolve' their language on ESG practices. Just as DEI departments are suddenly 'disappearing' from Corporate America by losing the D, E, and I, ESG is also suffering serious rechristenings. Business watchdogs monitoring the changes have noted the substitution of forgettably average-sounding terms like 'responsible business' and 'climate risk integration,' that convey their point without raising eyebrows. Coca-Cola recently stripped “ESG” from corporate reports and committee names, the Wall Street Journal reported last week. The goal is now 'to be more precise and to set goals that can be achieved,' the story noted. 'Saying as little as possible is recommended.' This tracks with the strategy Wall Street has quietly turned to, too. A survey published last August by Bloomberg found that financial analysts 'loathe' the acronym ESG, but say they’ll 'continue to incorporate environmental, social, and governance metrics in their business' nonetheless.[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
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