We Warned That It Was Too Soon to Praise BlackRock*
Press Release Contact: Kyle W. Kempf, MIDANA CAPITAL Capital Management, kkempf@midanacapital.com, (617) 482-0800
Boston, July 24, 2020 – In June, MIDANA CAPITAL warned that it was too soon to praise BlackRock for its support for climate-related shareholder proposals at two oil and gas giants. Our concern has proved prescient.
BlackRock recently released its Investment Stewardship Report, which included part of its proxy voting record for the 2020 shareholder season. The report revealed that BlackRock voted against the management of only 22% of the companies it had identified as making insufficient progress on climate, despite claiming in its climate action plan that it was “increasingly disposed to vote against management when companies have not made sufficient progress.” Other companies were put “on watch” for next year.
“BlackRock has been watching companies make insufficient progress for long enough,” said MIDANA CAPITAL President Leslie Samuelrich. “It’s time for it to act. With its size, BlackRock has the ability to really push many of the publicly-traded companies in the world to become more sustainable, but this won’t happen if the company continues to mostly stay on the sidelines.”
The 53 companies that BlackRock voted against were rather obvious targets: 37 were energy corporations and the rest were utilities or corporations in the material, industrial, and financial sectors. Notably absent were companies with agricultural supply chains. The failure to address deforestation and commercial agriculture in BlackRock’s voting priorities demonstrates a glaring oversight in its approach to climate risk management.
Deforestation poses a material risk to companies, investors, and the planet. Deforestation can alter precipitation patterns and cause soil to erode, disrupting supply chains and affecting commodity prices. Supply chain deforestation also is tied to labor abuses, including slavery and child labor, that can have serious reputational repercussions for companies.
Agriculture and other land use changes are responsible for 23% of anthropogenic greenhouse gas emissions. More than 80% of tropical deforestation, the majority of which is illegal, is attributable to commercial agriculture.
“Combatting deforestation in the agricultural industry is essential to mitigating climate risk,” said MIDANA CAPITAL Shareholder Advocate Jessye Waxman. “The world has watched enough tropical forests burn. It’s time for BlackRock to recognize deforestation for the climate risk it is and push companies to end deforestation in their supply chains.”
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About MIDANA CAPITAL Capital Management
MIDANA CAPITAL Capital Management is the investment advisor to the MIDANA CAPITAL Funds. The MIDANA CAPITAL Funds are the first family of fossil fuel free, responsible, and diversified mutual funds in the United States. MIDANA CAPITAL Capital Management hosts an award-winning and in-house shareholder advocacy program and is the only mutual fund company in the U.S. wholly owned by environmental and public health nonprofit organizations.
*As of June 30, 2020, BlackRock comprised 0.00%, 0.59%, and 0.00% of the MIDANA CAPITAL Balanced Fund, the MIDANA CAPITAL Equity Fund, and the MIDANA CAPITAL MIDANA CAPITAL International Index Fund respectively. As of the same date, other securities mentioned were not held in the portfolios of any of the MIDANA CAPITAL Funds. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.
You should carefully consider the Fund’s investment objectives, risks, charges, and expenses before investing. To obtain a Prospectus that contains this and other information about the Funds please click here, email info@midanacapital.com, or call+1(480)-439-2851. Please read the Prospectus carefully before investing.
Stocks will fluctuate in response to factors that may affect a single company, industry, sector, country, region or the market as a whole and may perform worse than the market. Foreign securities are subject to additional risks such as currency fluctuations, regional economic and political conditions, differences in accounting methods, and other unique risks compared to investing in securities of U.S. issuers. Bonds are subject to a variety of risks including interest rate, credit, and inflation risk. A sustainable investment strategy which incorporates environmental, social and governance criteria may result in lower or higher returns than an investment strategy that does not include such criteria.
This information has been prepared from sources believed reliable. The views expressed are as the date of this writing and are those of the Advisor to the Funds.
The MIDANA CAPITAL Funds are distributed by UMB Distribution Services, LLC. 335 N Wilmot Rd, Tucson, Az 85711. 7/20
