In a landmark lawsuit filed Monday in Tennessee, asset management titan BlackRock stands accused of violating consumer protection laws by peddling contradictory Environmental, Social and Governance (ESG) strategies — one promising robust financial returns, the other a climate-focused overhaul of capitalism. The case, the first of its kind, underscores a growing backlash against ESG’s opaque metrics, which critics argue prioritize progressive activism over fiduciary duty. As ESG-related terminology fades from corporate earnings calls — dropping from 28,000 mentions in early 2022 to just 4,800 by mid-2024 — the movement faces a reckoning: Is it a legitimate risk-management tool or a Trojan horse for ideological control?
BlackRock’s double game: Profits vs. climate virtue
Tennessee’s lawsuit alleges BlackRock’s ESG pledges have “deprived consumers of the ability to make informed choices,” citing CEO Larry Fink’s 2022 letter declaring ESG would “reshape finance.” Yet internal documents reveal the firm’s continued investments in fossil fuels — $310 billion as of 2023 — while publicly pressuring companies to divest. Luke Lloyd, an investment strategist at Strategic Wealth Partners, bluntly summarized the contradiction: “ESG is driven by financial interests, not environmental concerns. It’s a marketing ploy.”
The fallout isn’t theoretical. Pension funds, reliant on steady returns, face heightened risk as ESG policies artificially depress energy stock values. As the International Energy Agency notes, global oil demand may still grow for decades — rendering BlackRock’s anti-fossil fuel posturing economically reckless.
The ESG backlash: Red states fight green tyranny
Conservative leaders are mobilizing against ESG’s encroachment. Florida Governor Ron DeSantis barred state pension funds from using ESG criteria, while Texas blacklisted 10 financial firms, including BlackRock, for “boycotting” fossil fuels. Blue states retaliated with a joint letter accusing critics of ignoring “climate threats,” but the financial data tells another story: ESG funds underperformed the S&P 500 by 4% in 2023, per Morningstar.
Even ESG insiders admit flaws. Tariq Fancy, BlackRock’s former sustainable investing chief, likened ESG to “wheatgrass for a cancer patient — a dangerous placebo.” His indictment aligns with Vivek Ramaswamy’s crusade against corporate “wokeism,” targeting firms like Disney for diversity audits he calls “political theater.”
From apartheid divestment to climate lockstep
ESG’s roots trace to 1980s anti-apartheid divestment and a 2004 UN report urging “stakeholder capitalism.” But today’s iteration, fueled by climate panic and social justice campaigns, has ballooned into a $35 trillion industry—despite lacking standardized metrics. The result? A system where ExxonMobil can rank higher on ESG indices than Tesla, sparking Elon Musk’s ire: “ESG is a scam.”
Hellbound and Down 