Blackrock and The Amazon
As fires rage across the Amazon, a report released on Friday (30 August) reveals that BlackRock, the world’s largest institutional investor with $6.5 trillion in assets, is deeply invested in the sectors most responsible for tropical forest destruction in the Amazon and around the world.
BlackRock’s Big Deforestation Problem, released by Friends of the Earth U.S., Amazon Watch and Profundo, a Dutch financial research firm, tracked financial data between 2014 and 2018.
FINANCING FOREST DESTRUCTION
The findings reveal that BlackRock is among the top three shareholders in 25 of the world’s largest publicly listed ‘deforestation-risk’ companies – companies active in producing and trading soy, beef, palm oil, pulp and paper, rubber and timber – and among the top 10 shareholders in 50 more of the world’s largest deforestation-risk companies.
The data also reveal that BlackRock’s holdings in these sectors has increased by more than half a billion dollars since 2014.
‘The data is clear: from the Amazon to the great forests of Africa and Southeast Asia, BlackRock is a global leader in financing forest destruction.
‘As long as this financial behemoth continues to unconditionally back the world’s most destructive agribusiness companies, the forests of the world, and consequently the climate and the rights of forest-dwelling people, will continue to go up in flames. BlackRock is literally reaping profits as the world’s jungles burn.’
Lead author and senior international forest program manager with Friends of the Earth U.S.
ARE BLACKROCK’S HANDS TIED?
The report also shows that the vast majority of BlackRock’s deforestation-linked commodity holdings are made through index funds – passively managed funds that track the global marketplace.
‘BlackRock claims that its hands are tied by index funds. It is wrong. BlackRock can follow the lead of other global asset managers and make change for the good of the rainforest, the climate, and of its customers by shifting investments out of companies wrecking the planet, and applying maximum pressure to change company behaviour.
‘The fires currently raging in the Amazon clearly demonstrate the risk that agribusiness expansion poses for the Amazon rainforest, indigenous peoples and the global climate. By expanding investments in the very industries complicit in that destruction, BlackRock is emboldening right-wing President Jair Bolsonaro to continue his quest to raze the Amazon for profit-making’
Finance campaign director of Amazon Watch
A MATERIAL INVESTMENT RISK
Earlier this month the Intergovernmental Panel on Climate Change (IPCC) reported that deforestation and destructive land use practices are responsible for nearly a quarter of greenhouse gas emissions.
Some global investors like the Norwegian Government Pension Fund have blacklisted many of the companies in BlackRock’s portfolios and urged others to address the Amazon fires. Leading pension funds like CalPERS have also recognised deforestation as a material investment risk.
Rather than taking action to address the risks of catastrophic climate change, BlackRock’s investments in deforestation have been on the rise, the new report reveals.
This is despite public statements by BlackRock founder CEO Larry Fink that companies need to have a ‘social purpose’.