BlackRock ramps up ESG offering to navigate clients to net zero

The world’s biggest asset manager BlackRock is planning to ramp up the amount of products and services it offers to help investors “navigate, drive and invent” the transition to net zero.

BlackRock told investors in a letter that markets were beginning to price in the effects of climate transition on asset prices which was creating a “significant opportunity for our clients”, according to multiple media reports.

The firm is now planning to create the BlackRock Transition Scenario to forecast how the shift from a fossil fuel economy to impact technologies, sectors and regions.

There are plant to additionally launch more active and passively managed products to help clients access “climate-aware” strategies, bosses told investors, and the firm will expand its iShares strategies to include climate benchmarks, and roll out climate analytics with its consulting services.

ESG outperforms

The opportunity for investors in ESG played out last year as 70 per cent of a selection of ESG indices out-performed their non ESG counterparts, with average outperformance of over 100 points, BlackRock said.

The plans follow a robust defence of “stakeholder capitalism” laid out by boss Larry Fink in a letter to CEOs.

Fink said that firms that do not plan for the transition to a carbon-free future risked being left behind.

“Stakeholder capitalism is not about politics. It is not a social or ideological agenda," he wrote.

“We focus on sustainability not because we’re environmentalists, but because we are capitalists and fiduciaries to our clients.”