Introduction

BlackRock, the world’s largest asset manager, announced on Monday that Amin Nasser, the CEO of Saudi Aramco, the world’s largest oil company, will be joining its board of directors. This move underscores BlackRock’s long-term strategy and focus on the Middle East.

BlackRock’s Perspective

With over $8 trillion in client assets under management as of 2022, BlackRock believes that Amin Nasser’s extensive career at Aramco, spanning more than four decades, provides him with a unique perspective on crucial issues facing the firm and its clients. Larry Fink, chairman and CEO of BlackRock, expressed confidence that Nasser’s leadership experience, understanding of the global energy industry, knowledge of the Middle East region, and insights into the shift towards a low carbon economy will contribute significantly to the board’s discussions.

Amin Nasser’s Background

Amin Nasser has served as the CEO of Aramco since 2015 and played a key role in the company’s public listing in 2019. In 2021, Aramco announced its commitment to achieving net-zero gas emissions by 2050.

BlackRock’s ESG Approach

BlackRock has been a leader in adopting environmental, social, and corporate governance (ESG) guidelines and strategies within the financial industry. Despite facing criticism from both Democrats and Republicans for its fossil fuel investments, BlackRock has continued to offer a range of “sustainable” funds. The firm’s fiduciary duty is to provide investors with access to comprehensive information, including climate data, to make informed financial investment decisions.

Challenges Faced by BlackRock

BlackRock has faced challenges related to its ESG policies. In August 2022, Texas Comptroller Glenn Hegar included BlackRock on a list of financial companies that “boycott energy companies.” Additionally, Florida’s chief financial officer Jimmy Patronis announced in December that the state’s treasury would divest $2 billion of assets managed by BlackRock, criticizing the firm’s social-engineering project and stating that it contradicts the role of an asset manager.

BlackRock’s Stance on Environmental Issues

BlackRock’s CEO, Larry Fink, has consistently emphasized that asset managers are not the environmental police. Instead, he believes it is the responsibility of governments to enact policies and legislation related to environmental issues. However, BlackRock acknowledges its fiduciary duty to provide investors with the best available information, including climate data, to facilitate their investment decisions.

ESG Exchange-Traded Funds

One of BlackRock’s popular ESG exchange-traded funds, iShares ESG Aware MSCI USA ETF, currently manages nearly $15 billion in assets.