Blackrock has been slammed after increasing its stake in Glencore despite a previous pledge to scale down investment in coal producers.
Two years ago, Blackrock chief executive, Larry Fink, promised to put sustainability at the heart of investment decisions at the world’s largest asset manager.
His firm highlighted coal producers as a concern because they are ‘carbon intensive, becoming less and less economically viable, and highly exposed to regulation because of environmental impacts’.
Broken pledge: Two years ago, Blackrock chief executive Larry Fink promised to put sustainability at the heart of investment decisions at the world’s largest asset manager
But Glencore’s company records show that Blackrock’s holding has grown by more than 300million shares since January 2020.
This is an increase in value of £1.5billion given the latest share price, prompting calls of climate hypocrisy.
Blackrock now holds more than 1billion shares in Glencore, around 8 per cent, worth £5billion. That makes it the second-biggest shareholder. Only Glencore’s former chief, Ivan Glasenberg, now has a larger holding.
Glencore is a major global player in coal with 26 mines in Australia, Colombia and South Africa. In 2020, Blackrock said it would reduce assets in firms that generate more than 25 per cent of their revenues from coal.
Insiders say Glencore’s £8.7billion revenue from coal last year was less than a quarter of its turnover. But last Thursday Glencore was attacked as almost 24pc of shareholders voted against its climate progress report at the annual shareholder meeting.
Giuseppe Bivona, of activist investor Bluebell Capital, urged Blackrock to support the protest vote, which he believes it failed to do, he told The Mail on Sunday. Bivona said he was ‘sick and tired’ of Blackrock’s lack of action.
He added: ‘If you are preaching about sustainability and do the opposite then some serious questions need to be asked. What they do matters and what they don’t do matters even more.’
Glencore bought a coal mine in Colombia last year, which is set to boost its coal production by 17pc in 2022.
Bivona said: ‘Glencore needs to come to the realisation that we need to get coal out of this business. The Glencore board doesn’t understand where the right side of history is.’
Blackrock declined to comment when asked about the annual meeting.
A Glencore spokesperson said: ‘We will continue to engage with shareholders on our climate transition action plan so as to ensure their views are fully understood.’
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