Mississippi has acted against BlackRock Inc., the world’s largest asset manager, alleging widespread fraud in the marketing of the firm’s investment funds that do not carry an ESG (Environmental, Social, and Governance) label. The order specifies two primary categories of allegedly misleading statements by BlackRock, including those related to funds marketed by the investment manager as non-ESG funds, and those marketed as ESG funds. For the non-ESG funds, the order says that investors are led to believe that the funds are managed without regard to ESG criteria, while for the ESG-funds, the order states that BlackRock has made “deceptive statements” that “ESG benefits companies’ long-term financial prospects...” are untrue because “consideration of ESG factors does not provide an indication of better financial returns.”

Source: ESG Today