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BlackRock

In a striking development, the Texas Permanent School Fund (PSF) is cutting ties with BlackRock, marking a significant moment in the ongoing debate over Environmental, Social, and Governance (ESG) investing. This decision to withdraw $8.5 billion managed by BlackRock stems from a disagreement regarding ESG practices, which the Texas State Board of Education perceives as potentially detrimental to the state’s vital oil and gas sector. This move raises concerns about prioritizing political ideologies over financial outcomes, particularly for Texas taxpayers and the educational institutions reliant on the PSF. BlackRock counters the allegations, highlighting its substantial investments in the Texas energy sector, which exceed $120 billion, suggesting that the fund’s long-term financial performance could suffer as a result of this divestment. This episode is emblematic of the broader national discourse on the role of ESG investing, especially in states with economies heavily reliant on fossil fuels. It underscores the tension between fostering sustainable investment strategies and supporting traditional industries, with potential implications for the financial stability of public funds like the PSF and the entities they support.

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