We're taking action against investment company BlackRock for greenwashing

What is BlackRock?

With a portfolio of US $9 trillion, BlackRock is the world’s largest asset management company. Private individuals, pension funds, banks and others entrust BlackRock to manage their savings and in turn BlackRock invests this money on their behalf in companies around the world.

A significant amount of those investments go into fossil fuel companies, the vast majority of which are developing new projects or capacity. To date, BlackRock is the second largest institutional investor in fossil fuels overall with $400 billion worth of investments in the industry.

Why did we take action? 

BlackRock manages hundreds of investment funds in its portfolio, and a segment of these are marketed as “sustainable”. However, many of these so-called “sustainable” funds have invested over a billion in fossil fuel companies, the vast majority of which are developing new projects or capacity. This includes the likes of TotalEnergies, Shell, BP, Chevron, Conoco Phillips and Equinor.

We believe that this means BlackRock is greenwashing by calling these funds “sustainable”, and investors and the public need to know.  

We know that investors in France and elsewhere want to take sustainability into account in their investment choices – including fossil fuel expanders in ‘sustainable funds’ stops them doing that and undermines the integrity of the market for sustainable financial products.

What is greenwashing?

Greenwashing is where a company uses labelling, marketing and public messaging to try to appear to be environmentally sustainable and green – greener than it really is. It’s also a technique used by certain companies to distract consumers from the fact that their business model and activities actually do a lot of environmental harm.

What exactly was the action we took? 

In October 2024, we filed a letter of complaint to the French financial regulator - the Autorité des marchés financiers (AMF), to flag BlackRock’s greenwashing practices.  

Building on analysis from French organisation Reclaim Finance, we identified 18 actively managed retail investment funds marketed in France with ‘sustainable’ in their names, which collectively hold more than US$1 billion of fossil fuel investment, the majority of which represents fossil fuel expansion. This is why we filed the complaint to the French regulators. 

This action was to test what is actually meant by 'sustainable' in investment fund marketing for the first time. If we were to have had an encouraging result, it could have set a new standard for investment funds when it comes to both fossil fuel financing and sustainable finance. 

Read the full complaint here

What have BlackRock said in response?

In response to the filing of the complaint, a BlackRock spokesperson said:

“BlackRock funds are managed in accordance with their investment objectives, which are clearly stated in each fund's prospectus and on the website.”

They also said they comply with all regulations on sustainable investment.  

Since the complaint was filed, BlackRock announced changes to many of its funds previously labelled as ‘sustainable’ or ‘ESG’. This includes 17 of the 18 ‘sustainable’ funds that we covered in our complaint.

• 14 of the 18 funds will drop ‘sustainable’ from their names
• 3 of the 18 funds will still be called ‘sustainable’, but will apply new fossil fuel investment exclusions
• 4 funds have replaced ‘sustainable’ with ‘ESG’ and will apply new fossil fuel investment exclusions

BlackRock explained that these changes are to comply with ESMA’s new fund naming guidelines. But we maintain that regulators should act where investors have been misled.

What outcome were we hoping for? 

We wanted to see three main things as a result of this complaint: 

1. Enforcement from the financial regulator to ensure investment firm funds labelled ‘sustainable’ are actually so. 
2. For BlackRock itself to either change the language it uses when marketing its investments, or to reallocate its 'sustainable' fund portfolios so that its investments are consistent with how it presents these funds to the public.  
3. This is a systemic issue. We want other investment managers to heed the warning of this complaint against BlackRock, and for regulators around the world to pay attention to how investment companies are marketing their own 'sustainable' funds. 

This would give the public clarity on what the word “sustainable” means when it comes to investments and help stop the misallocation of investment to some of the least sustainable companies in the world – which could have impact far beyond this complaint.  

What’s the next step?  

Now the complaint has been filed, it’s up to the regulator (AMF) to take it forward or not. We’ll be keeping up public pressure on BlackRock and we will also be notifying the European financial regulator (ESMA) of the action we’re taking.