DeSantis Hits Wall Street Where It Hurts, Pulls $2 Billion of State Assets from BlackRock over ‘Woke’ ESG

Florida’s Republican Governor Ron DeSantis has hit Wall Street where it hurts by terminating a $2 billion contract with Larry Fink’s BlackRock over its “woke” ESG policies.

Environmental, Social, and Governance standard (ESG) refers to non-financial standards used by asset managers in financial decision-making and is often referred to as social or corporate credit rating.

Florida Chief Financial Officer (CFO) Jimmy Patronis announced that the Florida Treasury will begin divesting $2 billion worth of assets currently under management by BlackRock.

The State Treasury will immediately have Florida’s custody bank freeze approximately $1.43 billion worth of long-term securities and remove them as the manager of approximately $600 million worth of short-term overnight investments.

CFO Jimmy Patronis said, “As Florida’s Chief Financial Officer, it’s my responsibility to get the best returns possible for taxpayers.

“The more effective we are in investing dollars to generate a return, the more effective we’ll be in funding priorities like schools, hospitals and roads.

“As major banking institutions and economists predict a recession in the coming year, and as the Fed increases interest rates to combat the inflation crisis, 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.

“BlackRock CEO Larry Fink is on a campaign to change the world.

“In an open letter to CEOs, he’s championed ‘stakeholder capitalism’ and believes that ‘capitalism has the power to shape society.’

“To meet this end, the asset management company has leaned heavily into Environmental, Social, and Governance standards – known as ESG – to help police who should, and who should not gain access to capital.

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“Whether stakeholder capitalism, or ESG standards, are being pushed by BlackRock for ideological reasons, or to develop social credit ratings, the effect is to avoid dealing with the messiness of democracy. I think it’s undemocratic of major asset managers to use their power to influence societal outcomes.

“If Larry, or his friends on Wall Street, want to change the world – run for office. Start a non-profit. Donate to the causes you care about.

“Using our cash, however, to fund BlackRock’s social-engineering project isn’t something Florida ever signed up for.

“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.

“As Larry Fink stated to CEOs ‘[A]ccess to capital is not a right. It is a privilege.’

“As Florida’s CFO I agree wholeheartedly, so we’ll be taking Larry up on his offer,” he said.

“There’s no lack of companies who will invest on our behalf, so the Florida Treasury will be taking its business elsewhere.”

BlackRock said in a statement:

“We are surprised by the Florida CFO’s decision given the strong returns BlackRock has delivered to Florida taxpayers over the last five years.

“Neither the CFO nor his staff have raised any performance concerns.

“We are disturbed by the emerging trend of political initiatives like this that sacrifice access to high-quality investments and thereby jeopardize returns, which will ultimately hurt Florida’s citizens.

“Fiduciaries should always value performance over politics,” the statement said.

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By David Hawkins

David Hawkins is a writer who specializes in political commentary and world affairs. He's been writing professionally since 2014.

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