JACKSON, Miss. – Secretary of State Michael Watson announced today a resolution of his landmark cease and desist order related to BlackRock, Inc.’s Environmental, Social, and Governance (ESG) practices.

On March 26, 2024, Secretary Watson entered Administrative Order LS-24-6726 (the “Administrative Order”) that summarily ordered BlackRock to cease and desist from alleged violations of Miss. Code Ann. §§ 75-71-501(2), 75-71-501(3) & 75-71-502(a)(2).

“By bringing this action, I have now assured that the money Mississippians invest with BlackRock is managed consistent with their objectives,” said Secretary Watson. “I’ve had concerns about BlackRock’s ESG practices, and I am pleased to announce we have resolved our outstanding issues. Thanks to the work of the Securities team at the Office of the Secretary of State on behalf of the people of Mississippi, BlackRock has committed to spend $1,000,000 to enhance financial literacy efforts in the state.”

In response to requests from Secretary Watson, BlackRock provided substantial information concerning matters relevant to the allegations contained in the Administrative Order, including the following:

• BlackRock has withdrawn from Climate Action 100+ and Net Zero Asset Managers (NZAM)
• BlackRock’s Investment Stewardship team will continue to:
  • (a) pursue engagement activities with portfolio companies solely to further the financial interest of investors absent contrary disclosure;
  • (b) independently cast proxy votes; and
  • (c) disclose each quarter a record of proxy votes and rationales for any votes against management’s recommendations on environmental or social shareholder proposals or against any board members’ election based on an ESG factor.
• BlackRock has removed sustainability characteristics, or ESG ratings, from the product pages of a number of BlackRock funds.
• BlackRock will continue to provide, through its voting choice program, certain investors with the right to direct BlackRock in the voting of proxies for securities in which the investors hold a direct or indirect interest, ensuring votes are cast in line with the preferences and directions of investors.
• BlackRock has enhanced disclosures on its website, including the addition of a landing page that includes information on its participation in industry related to sustainability.

As part of the resolution, the Office of the Secretary of State has withdrawn the Administrative Order, reserving the right to issue a new order should BlackRock fail to continue along its course correcting measures.