Dive Brief:
- BlackRock shareholders appointed Saudi Aramco CEO Amin Nasser to the firm’s independent board of directors at the asset manager’s annual board meeting Wednesday.
- BlackRock, the nation’s largest asset management firm, did not disclose individual vote tallies for board members, but said during the meeting that its entire slate of directors received “well over a majority” of support and were elected or re-elected. Final tallies are expected to be released within four business days of the meeting.
- Nasser was first appointed to the board last July, but this week’s board election was the first opportunity for shareholders to weigh in. The New York City Comptroller’s Office had urged shareholders to oppose Nasser’s re-appointment earlier this month in a securities filing, arguing Nasser’s Aramco ties — and BlackRock’s investments in the oil company — compromise his ability to serve independently.
Dive Insight:
The election affirms a full-year term for Nasser, chief executive of the world’s largest oil and gas producer, as a member of BlackRock’s 16-member board of directors. He joins 14 other independent board members, board chair and BlackRock CEO Larry Fink and the firm’s president Robert Kapito.
In proxy materials, BlackRock said Nasser’s election will give the board access to his “extensive expertise and insight into corporate operations, risk management and the energy transition, as well as an experienced outlook on international business strategy.”
BlackRock also faced a shareholder resolution proposed by Mercy Investment Services to review both its 2023 proxy voting record and its climate change-related proxy voting policies, given its steep decline in support for environmental proposals between 2022 and 2023.
BlackRock supported just 7% of environmental shareholder proposals at portfolio companies last year, down from the 28% it supported in 2022. Sustainable investment experts have blamed the firm’s shift in voting patterns — along with Vanguard, as the nation’s two largest asset managers — as a driver of declining ESG proposal support.
The firm announced that Mercy Investment’s resolution received just 8% of shareholders’ support. BlackRock said 87% of outstanding shares were present at the board meeting.
Jessye Waxman, a senior strategist with Sierra Club’s Fossil-Free Finance campaign, said in a release that shareholders’ votes on climate-related matters were “concerning.” Waxman said shareholders “appear timid about encouraging BlackRock to take this issue seriously – whether through its proxy voting or choice of directors.”
“Climate risk management is not a political issue, it’s a responsible investment practice,” Waxman said. “Financially material climate-related risks are growing, but can be mitigated through better corporate governance and investment decisions.”
NYC Comptroller Brad Lander argued in an exempt solicitation filed with the Securities and Exchange Commission on May 1 that Nasser’s oil and gas ties will compromise his ability to serve in an independent oversight capacity. Lander was specifically concerned with Nasser’s ability to be impartial with respect to the firm’s decarbonization strategy.
“Nasser has a vested interest in — and is an outspoken vocal advocate for — the expansion of fossil fuels,” Lander wrote in the filing. “Such positions directly conflict with BlackRock’s publicly stated commitment to ‘supporting the goal of net zero greenhouse gas emissions by 2050 or sooner.’”
Nasser told attendees at S&P Global’s CERAWeek energy conference in March that “We should abandon the fantasy of phasing out oil and gas, and instead invest in them adequately, reflecting realistic demand assumptions, as long as essential,” Reuters reported.
Lander also called into question BlackRock’s relationship with Aramco, pointing to a 2022 transaction where a group co-led by the investment firm purchased a 49% equity stake in Aramco for $15.5 billion. At the time, Fink called it a “landmark transaction” that would deepen the partnership between the two companies and left open the possibility of “future collaborations.”
