{"id":1552145,"date":"2022-07-13T08:01:58","date_gmt":"2022-07-13T12:01:58","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1552145"},"modified":"2022-07-13T09:49:40","modified_gmt":"2022-07-13T13:49:40","slug":"startup-backed-by-billionaire-investors-on-crusade-against-climate-investing","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/startup-backed-by-billionaire-investors-on-crusade-against-climate-investing\/","title":{"rendered":"Startup Backed by Billionaire Investors on Crusade Against \u201cClimate Investing\u201d"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">20<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fstartup-backed-by-billionaire-investors-on-crusade-against-climate-investing%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1552145&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>A few years ago, it would have been <a href=\"https:\/\/corpgov.law.harvard.edu\/2021\/07\/05\/why-exxonmobils-proxy-contest-loss-is-a-wakeup-call-for-all-boards\/\" target=\"_blank\" rel=\"noopener\">hard to imagine<\/a> an activist hedge fund gaining three board seats at America\u2019s largest oil and gas company. A fledgling fund called Engine No. 1 with just 0.02 percent ownership in <a href=\"https:\/\/www.theepochtimes.com\/t-exxonmobil\">ExxonMobil<\/a>, voted out three board members at the oil giant in 2021, <a href=\"https:\/\/knowledge.wharton.upenn.edu\/article\/engine-no-1s-victory-wake-up-call-for-exxonmobil-and-others\/\" target=\"_blank\" rel=\"noopener\">scoring a victory<\/a> for the climate change movement.<\/p>\n<p>The fund had backing from \u201cbig three\u201d institutional investment firms BlackRock, Vanguard, and State Street.<\/p>\n<p>Exxon wasn\u2019t the only target of shareholder activism. The world\u2019s largest oil producers, such as Shell, Chevron, and BP, have all faced shareholder revolts from activist investors who urged them to address climate change.<\/p>\n<p>However, actions of these investors have crippled the U.S. oil and gas production, contributing to the current energy crisis, according to Vivek Ramaswamy and Anson Frericks, co-founders of Strive, an Ohio-based asset management firm.<\/p>\n<p>Launched in May, Strive says it wants to replace the voices of large investment firms in the American economy with those of everyday citizens.<\/p>\n<p>The founders claim that large fund managers breach their fiduciary duties by placing too much emphasis on climate change and \u201c<a href=\"https:\/\/www.theepochtimes.com\/t-stakeholder-capitalism\">stakeholder capitalism<\/a>\u201d rather than higher returns.<\/p>\n<p>Among Strive\u2019s notable backers are billionaire investors Bill Ackman and Peter Thiel.<\/p>\n<h2>US Energy Crisis<\/h2>\n<p>On Independence Day, the startup announced that it launched a \u201cfive-week national education campaign to draw attention to the American energy crisis and how U.S. citizens are unknowingly contributing to the problem through their investment accounts.\u201d<\/p>\n<p>\u201cAmericans do not just vote in November at the polls, they vote every day with how they choose to allocate their investment dollars. Today their money is often used by large asset managers to erode U.S. energy independence and increase their own energy bills,\u201d the company stated in a\u00a0<a href=\"https:\/\/www.businesswire.com\/news\/home\/20220705005089\/en\/Strive-Asset-Management-Launches-National-Education-Campaign-on-U.S.-Energy-Independence\" target=\"_blank\" rel=\"noopener\">press release<\/a>.<\/p>\n<p>The founders of the firm believe that every day firefighters, police officers, teachers, doctors, and small business owners funnel their money into these large asset managers through their retirement funds. But, the shareholder voting and engagement behaviors of these investment funds in the last few years, they contend, have pressured U.S. energy companies to produce less oil and natural gas in the United States, causing high energy prices.<\/p>\n<p>\u201cOur expectation from this campaign is to make the energy sector more successful in the United States,\u201d Frericks told The Epoch Times.<\/p>\n<p>He criticized BlackRock, Vanguard, and State Street for <a href=\"https:\/\/www.theepochtimes.com\/t-investing\">investing<\/a> based on <a href=\"https:\/\/www.theepochtimes.com\/t-esg\">ESG<\/a> (environmental, social, and governance) standards that may be in conflict with the interests of their clients.<\/p>\n<p>Most big European and American oil companies have <a href=\"https:\/\/www.spglobal.com\/marketintelligence\/en\/news-insights\/latest-news-headlines\/activist-investors-turning-up-heat-on-oil-majors-in-proxy-voting-season-69438831\" target=\"_blank\" rel=\"noopener\">net-zero targets<\/a> for 2050, as well as interim emissions-reduction goals. However, activist investors find these proposals unambitious. Thus, they use their voting powers to push corporations to adopt more stringent climate change goals in line with the Paris Agreement.<\/p>\n<p>Since losing board seats to activist investors, Exxon cut long-term production plans, maintaining oil output at its lowest level in two decades, according to Strive\u2019s founders.<\/p>\n<p>\u201cThe same large asset managers who pressure U.S. companies to adopt climate change strategies by reducing oil and gas production stay notably silent as their Chinese portfolio companies behave in the opposite manner,\u201d Ramaswamy said in the press release. \u201cAmerican citizens are left holding the bag twice, both as investors and as consumers at the pump.\u201d<\/p>\n<figure id=\"attachment_4323885\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/img.theepochtimes.com\/assets\/uploads\/2022\/03\/08\/Vivek-Ramaswamy-3-2-1200x675.jpg\"><figcaption class=\"wp-caption-text\"><noscript><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-4323885 size-large\" src=\"https:\/\/img.theepochtimes.com\/assets\/uploads\/2022\/03\/08\/Vivek-Ramaswamy-3-2-1200x675.jpg\" alt=\"Epoch Times Photo\" width=\"640\" height=\"360\" \/><\/noscript><\/figcaption><\/a> Vivek Ramaswamy, co-founder of Strive during an interview in Orlando, Fla., on March 8, 2022. (Tal Atzmon\/The Epoch Times)<\/figure>\n<p>In coming weeks, Strive plans to promote a series of digital videos to raise awareness of the domestic energy crisis. As part of the education campaign, Ramaswamy will also tour the United States for the next five weeks speaking to Americans about the significance of regaining energy independence.<\/p>\n<h2>\u2018Depoliticized\u2019 Investment<\/h2>\n<p>The big three asset managers, which hold nearly 20 percent of the outstanding shares of the S&#038;P 500, have made substantial climate pledges during the last few years, according to an <a href=\"https:\/\/corpgov.law.harvard.edu\/2021\/07\/05\/why-exxonmobils-proxy-contest-loss-is-a-wakeup-call-for-all-boards\/\">article<\/a> by Harvard Law School Forum on Corporate Governance.<\/p>\n<p>They manage collectively about $20 trillion worth of assets and wield enormous power on corporate boards due to their voting rights, Frericks says.<\/p>\n<p>This is problematic, he argues, since these three asset managers are all promoting the same ideology, namely stakeholder capitalism and ESG.<\/p>\n<p>The World Economic Forum promotes <a href=\"https:\/\/www.weforum.org\/agenda\/2021\/01\/klaus-schwab-on-what-is-stakeholder-capitalism-history-relevance\/\">stakeholder capitalism<\/a> as a better system in which corporations seek long-term value creation by considering the requirements of all its stakeholders and society at large.<\/p>\n<p>Opponents, however, criticize these trends, stating that they\u2019re politicizing investment decisions and creating an expensive deviation from basic financial investing principles.<\/p>\n<p>\u201cWe try to bring new ideas, diversity of thought, diversity of opinion, because we think there are 100 to 150 million American investors who want a depoliticized asset management company,\u201d Frericks said. \u201cOur mission is to advance excellence over politics in boardrooms across America.\u201d<\/p>\n<p>As part of the education campaign, Ramaswamy will also present shareholder resolutions at the <a href=\"https:\/\/enercomdenver.com\/\" target=\"_blank\" rel=\"noopener\">EnerCom Denver<\/a>, a major energy investment conference in August, with the goal of \u201crectifying damage inflicted\u201d on the oil and gas sector by large asset managers.<\/p>\n<p>Strive has raised $20 million from venture capitalists to help hire staff and build investment products. The first fund of the company will be launched in the third quarter of this year.<\/p>\n<p>Similar to those offered by Blackrock, State Street, and Vanguard, the business is developing large, predominantly passive investment products,\u00a0Frericks said.<\/p>\n<p>\u201cWe\u2019ve been incredibly humbled by the outpouring of support we\u2019ve received\u201d from investors and prospective employees, he added.<\/p>\n<p>Vanguard and State Street did not respond to a comment request from The Epoch Times.<\/p>\n<figure id=\"attachment_3390809\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/img.theepochtimes.com\/assets\/uploads\/2020\/06\/16\/BlackRock_Fink-1200x800.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"lazy wp-image-3390809 size-medium\" src=\"https:\/\/www.theepochtimes.com\/assets\/themes\/eet\/images\/white.png\" data-src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/07\/BlackRock_Fink-600x400-1.jpg\" alt=\"Larry Fink\" width=\"600\" height=\"400\" \/><figcaption class=\"wp-caption-text\"><noscript><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-3390809 size-medium\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/07\/BlackRock_Fink-600x400-1.jpg\" alt=\"Larry Fink\" width=\"600\" height=\"400\" \/><\/noscript><\/figcaption><\/a> BlackRock CEO Larry Fink attends a session at the World Economic Forum annual meeting in Davos on Jan. 23, 2020. (Fabrice Coffrini\/AFP via Getty Images)<\/figure>\n<p>BlackRock, the world\u2019s biggest investment manager with more than $10 trillion in assets, declined to comment but referred to its proxy vote bulletin for Exxon that explained the asset manager\u2019s position at last year\u2019s annual meeting.<\/p>\n<p>\u201cOver the past several years, we have intensified our focus with the company on its long-term strategy and Exxon\u2019s underperformance relative to both its peers and the S&#038;P 500 over the last five years,\u201d the fund manager explained.<\/p>\n<p>\u201cIn our vote bulletin explaining our vote at last year\u2019s annual meeting, we emphasized our prevailing view that the risks of climate change and the transition to a lower carbon economy present material regulatory, reputational, and legal risks to companies that may significantly impair their financial position and ability to remain competitive going forward.\u201d<\/p>\n<h2>Rising Backlash<\/h2>\n<p>The energy crisis is fueling a backlash against big asset management firms.<\/p>\n<p>In February, the Wall Street Journal Editorial Board <a href=\"https:\/\/www.wsj.com\/articles\/calling-out-emperor-larry-fink-charlie-munger-financial-markets-berkshire-hathaway-11645136040\" target=\"_blank\" rel=\"noopener\">criticized<\/a> Larry Fink, CEO of BlackRock for pressuring public companies and their executives.<\/p>\n<p>\u201cAs Americans have poured savings into exchange-traded and mutual funds, index providers have become the de facto largest shareholders of public companies,\u201d the editorial board wrote.<\/p>\n<p>The publisher criticized the investment firm for using its market power for political purposes.<\/p>\n<p>Fink has repeatedly said \u201cclimate risk is investment risk.\u201d<\/p>\n<p>\u201cEvery company and every industry will be transformed by the transition to a net zero world,\u201d he wrote in his most <a href=\"https:\/\/www.blackrock.com\/corporate\/investor-relations\/larry-fink-ceo-letter?cid=ppc:blk:ll:na:ol:goog:na:sl1:bhv:tl&#038;gclid=CjwKCAjwq5-WBhB7EiwAl-HEkgf7CTR6sOYEd1uj3aamNbG3sfAvbfHOQ-B6CwaFAc2V-q-1CAyr4BoCGggQAvD_BwE&#038;gclsrc=aw.ds\" target=\"_blank\" rel=\"noopener\">recent letter<\/a> to company CEOs.<\/p>\n<p>\u201cThe question is, will you lead, or will you be led?\u201d<\/p>\n<div class=\"author_wrapper\">\n<div class=\"one_author_block round\">\n<div class=\"top_row\">\n\t\t\t\t\t<a href=\"https:\/\/www.theepochtimes.com\/author-emel-akan\"><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/07\/15ef0812da90bd74_ttl7dayCNO_WEB_EmelAkan-1.jpg\" alt=\"Emel Akan\" \/><\/a><\/p>\n<p>Follow<\/p>\n<\/div>\n<p>Emel Akan writes about business and economics. Previously she worked in the financial sector as an investment banker at JPMorgan. She graduated with a master\u2019s degree in business administration from Georgetown University.<\/p>\n<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>A few years ago, it would have been hard to imagine an activist hedge fund gaining three board seats at America\u2019s largest oil and gas company. A fledgling fund called<\/p>\n","protected":false},"author":1,"featured_media":2315279,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1552145","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1552145","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1552145"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1552145\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1552145"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1552145"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1552145"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}