NEW YORK (Reuters) - The world’s largest asset manager, BlackRock Inc (BLK.N), on Tuesday hired the Obama administration’s one-time adviser on climate change to lead an effort to appeal to people who want to invest in a way that helps society.
BlackRock is bringing in Brian Deese to run its recently-renamed Sustainable Investing group, according to a company memo seen by Reuters.
Deese helped negotiate the Paris agreement on climate change, from which Obama’s successor, U.S. President Donald Trump, has said he wants to withdraw.
Wall Street is increasingly championing environmental, social and corporate-governance (ESG) standards to attract younger investors and institutions like universities and religious organizations that want to align their portfolios with their values.
BlackRock has previously said investors should factor climate change into their decision-making and that doing so would not mean having to accept inferior returns.
Yet its ESG growth has been muted. BlackRock’s sustainable unit manages $195 billion, spokesman Ed Sweeney said. That is down from more than $225 billion in February 2015, when BlackRock announced plans to coordinate its efforts in the space.
At the time BlackRock tapped former anti-poverty campaigner Deborah Winshel to oversee the initiative, known previously as BlackRock Impact, and to lead its philanthropic program. Winshel will now focus full-time on philanthropy, the memo said. She could not be reached for comment.
Growth in products that pursue social goals and investments in companies with strong ESG track records have partially offset a decline in assets in investments that screen out certain stocks or bonds, said Sweeney.
Deese will enlist specialists in climate and use of natural resources and add a chief investment officer for sustainable investing to work with the company’s portfolio managers, according to the memo, which was signed by BlackRock Global Head of Multi-Asset Strategies Richard Kushel.
Deese was also previously involved in developing the Obama administration’s bailout of the U.S. auto industry, budget deals with Congress and an unsuccessful effort to nominate Merrick Garland to the U.S. Supreme Court.
He declined to comment.
Reporting by Trevor Hunnicutt, Editing by Rosalba O'Brien