Florida to Pull $2B of Assets From BlackRock

What You Need to Know

It’s the latest move in a fight led by Governor Ron DeSantis against firms embracing environmental, social and corporate governance values.

Florida will pull $2 billion worth of state assets managed by BlackRock Inc., accelerating Republicans’ fight with the world’s largest money manager over its ESG investing practices.

The state treasury will immediately have Florida’s custody bank freeze about $1.43 billion worth of long-term securities and remove BlackRock as the manager of approximately $600 million worth of short-term overnight investments, Florida Chief Financial Officer Jimmy Patronis said in a statement on Thursday.

The pullback is the latest step in a broader fight led by Republican Governor Ron DeSantis against corporations that embrace environmental, social and corporate governance values.

“I need partners within the financial services industry who are as committed to the bottom line as we are – and I don’t trust BlackRock’s ability to deliver,” Patronis said in the statement.

“Using our cash, however, to fund BlackRock’s social-engineering project isn’t something Florida ever signed up for,” he said. “It’s got nothing to do with maximizing returns and is the opposite of what an asset manager is paid to do. Florida’s Treasury Division is divesting from BlackRock because they have openly stated they’ve got other goals than producing returns.”

Reuters reported Florida’s planned divestiture earlier. The Florida Department of Financial Services manages approximately $60 billion in taxpayer money.

Ed Sweeney, a spokesperson for New York-based BlackRock, said the firm is “surprised” by the decision given the strong returns the company has delivered for Florida the last five years.

ESG Trigger

Republicans are ratcheting up attacks on environmental, social and governance investing this year.

BlackRock, which oversees $8 trillion globally, is a major proponent of the strategy and has been a prime target for the GOP. Louisiana and Missouri have pulled a combined $1.3 billion from BlackRock this year. And in August, Texas included the firm on a list of those it says boycott the energy industry.