According to Larry Fink, CEO of BlackRock, the climate crisis will fundamentally change the financial world, according to an article by Citywire. As a result, BlackRock has announced that in the future it will focus more on sustainability, both in portfolio construction and risk management. For example, BlackRock will divest investments that pose a sustainability risk, such as a coal producer.
All active managers are to integrate ESG criteria within this year. This includes a number of initiatives such as joining the Climate Action 100+ initiative, new sustainable active investment strategies, working with index providers to develop new sustainable indices, doubling the range of sustainable ETFs, simplifying and expanding the range of ESG ETFs and, finally, excluding companies that mine metallurgical and thermal coal.
To set standards for sustainability reports, Fink relies on the Sustainability Accounting Standards Board. Larry Fink emphasizes that future transparency in sustainability issues will increasingly determine whether a company can raise the necessary capital.
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