Netherlands-based pension fund pension fund manager PME Pensioenfonds announced a decision to end its relationship with BlackRock as a manager for its equity portfolio, following an ESG-focused review of its external asset managers.
The announcement marks the second significant ESG-related mandate loss for BlackRock from a Dutch pension fund, following a decision earlier this year by pension fund PFZW to pull approximately €14 billion from the firm as part of a shift towards a more sustainability-focused investment policy.
PME manages approximately €59 billion in assets for pensioners in the metal and technology sector, with BlackRock’s equity mandate reportedly accounting for around €5 billion (USD$5.9 billion). Other managers for PME’s equity portfolio include MN and UBS Global Asset Management.
According to PME, the decision follows the launch of its ESG framework in 2022, which it used to construct its “Portfolio of Tomorrow”, described by the pension manager as “an equity portfolio in which every company is selected based on deliberate choices aimed at achieving solid returns and supporting a livable world.
The firm said that it evaluated BlackRock as part of its process managing its ESG index portfolio, and while acknowledging that “BlackRock has provided PME with high-quality services for many years in managing part of our equity portfolio,” it said that it decided to end its relationship with BlackRock, adding that it “considers which external managers best align with our vision and the principles of the Portfolio of Tomorrow.”
The mandate losses highlight the tensions faced by global asset managers dealing with increasingly disparate views over the role of ESG considerations in investment decision making, with some political pressure in the U.S. leading some asset owners and funds to exclude managers with a sustainability focus and anti-ESG politicians even warning asset managers against considering sustainability factors, while European funds often require a more active sustainability focus in their mandate considerations. These tensions have emerged even within the U.S., with BlackRock recently at the center of anti-ESG moves by Republican politicians, while also facing a call from New York City’s Comptroller to drop the asset manager’s $42 billion mandate with the city over its climate risk management plans.
In a statement provided to ES Today, a BlackRock spokesperson said:
“BlackRock has been entrusted by clients in the Netherlands and around the world to manage more sustainable and transition assets than any other asset manager. These clients see us as their partner of choice for achieving their investment goals, including their net zero objectives. We manage more than €350 billion in total for our Dutch clients and are proud of our continued growth in the country. We are grateful for the opportunity to have served PME and its members for more than a decade.”
Despite the mandate losses, BlackRock said that its EMEA business had a record year with through Q3 with around $129 billion in net new business, including approximately $30 billion from its Sustainable offerings.
