New York City Comptroller Brad Lander is advocating for city pension fund officials to re-bid $42.3 billion currently managed by BlackRock, citing concerns that the asset manager has deprioritised climate considerations. This move is significant as it represents a prominent Democratic official countering the pressure exerted on financial institutions by Republican allies within the fossil fuel industry. Lander’s recommendation, announced Wednesday and preceding the end of his term on December 31, places added scrutiny on Mayor-elect Zohran Mamdani, who will assume office in roughly five weeks.
BlackRock, headquartered in New York, is the world’s largest asset manager and the city’s largest manager of retirement assets. The company has expressed its intent to retain the business. BlackRock indicated in February that it would not use discussions with executives to try to control companies. Lander, in response, stated that this change represented “an abdication of financial duty and renders them unable to meet our expectations for responsible investing.”
In addition to BlackRock, Lander recommended discontinuing deals with Fidelity Investments and PanAgora, citing their insufficient pressure on companies regarding environmental issues. Conversely, he advised that the three pension systems continue using State Street to manage $8 billion in equity index assets. Several Republicans have withdrawn funds from BlackRock and other money managers over concerns of investment decisions being influenced by social or environmental factors. New York City’s action would be among the first large U.S. pension funds to take a similar action from the Democratic perspective.
Lander highlighted that his review indicated 46 out of 49 fund managers for the city have plans aligning with his expectations for encouraging corporations to decarbonise. While Lander’s recommendation requires approval from pension boards, traditionally influenced by the comptroller’s office, it remains to be seen how Mamdani’s appointees will navigate this decision. BlackRock’s head of Americas institutional business, Armando Senra, stated that the comptroller’s claims “are another instance of the politicization of public pension funds, which undermines the retirement security of hardworking New Yorkers.”
