Texas is threatening to bar BlackRock and 9 other financial firms from doing business in the Lone Star state because of ESG policies they deem unfriendly to the energy industry. Texas Comptroller Glenn Hegar published a list that calls out BlackRock and firms like Credit Suisse for ESG policies that effectively boycott energy firms. Some financial firms disagree with their placement on the list, as BlackRock notes that it holds fossil fuel stocks.
The list includes 350 individual funds and comes on the heels of a Texas law passed last year that requires state agencies not to do business with companies that it deems are anti-energy industry. Texas state funds like the $200 billion Teacher Retirement System are required under the new law to reveal what funds are tied to BlackRock and other “anti-energy” firms on the state’s blacklist.
The move by Texas is part of a broader anti-ESG backlash growing nationwide, including in states like Oklahoma and West Virginia. Texas’ new laws, Senate Bills 13 and 19, are intended to protect the state’s oil and gas companies and firearms companies. Commercial real estate firms like Boston Properties and Brookfield Asset Management with ESG policies could also get caught up in the ESG backlash, but the move could backfire for states like Texas. A report by the Wharton School at the University of Pennsylvania says the new laws in Texas could cost Texas cities up to $532 million in interest on $32 billion in bonds.