Texas School Fund Pulls $8.5 Billion Investment From BlackRock

Texas is divesting $8.5 billion from BlackRock Inc. due to the investment company’s fossil fuel policies, according to a statement from the chairman of the State Board of Education.

Aaron Kinsey, the Republican chairman of board, said that the $53 billion Texas Permanent School Fund on Tuesday delivered an official notice to BlackRock “terminating its financial management of approximately $8.5 billion in Texas’ assets.”

Kinsey said that the leadership of the fund decided to do so in order to comply with a 2021 law that restricts investments with companies that engage in so-called boycotts of the fossil fuels industry. BlackRock is on a list of companies that State Comptroller Glenn Hegar considers to engage in a boycott of the industry.

BlackRock has always maintained it does not engage in any boycott. “BlackRock is helping millions of Texans invest and save for retirement,” the company said in a statement Tuesday. “On behalf of our clients, we’ve invested more than $300 billion in Texas-based companies, infrastructure and municipalities, including $125 billion invested in the energy sector, including $550 million a joint venture with Occidental.”

Read more: Why Texas Is Banning Banks Over Their ESG Policies: QuickTake

In February, Texas Lieutenant Governor Dan Patrick, a Republican, took the stage with BlackRock Chief Executive Officer Larry Fink at an industry event in Houston. That led to speculation that the state’s tensions with BlackRock may have cooled. But this latest announcement shows the state’s fight with BlackRock isn’t going away anytime soon.

A spokesperson for the Permanent School Fund did not respond to a request for comment. Created in 1845, the fund helps finance schools in Texas.

Kinsey is the chief executive officer of American Patrols, an aviation oilfield services company in Midland, according to a biography on the state BOE website.

Read more: Texas Lauds BlackRock’s ‘King of Wall Street’ in Change of Tune

“Today represents a major step forward for the Texas PSF and our state as a whole,” Kinsey said in the statement. “The PSF will not stand idle as our financial future is attacked by Wall Street. This bold action helps ensure our PSF remains in fact permanent and will continue to support bright futures and opportunities for generations of Texas students.”

To contact the reporters on this story:
Amanda Albright in New York at aalbright4@bloomberg.net;
Saijel Kishan in New York at skishan@bloomberg.net

To contact the editors responsible for this story:
Danielle Moran at dmoran21@bloomberg.net

Michael B. Marois

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