BlackRock says 'fundamental change' to sustainability will sweep financial markets

Sustainability aspects are gaining in importance at a very quick pace and are poised to bring about "fundamental change" to the way financial market actors operate, Philipp Hildebrand, vice head of US investment company BlackRock, said in an interview with the Frankfurter Allgemeine Zeitung. Hildbebrand said that about 18 billion dollars have been put into BlackRock's sustainable investment products since the beginning of 2020 despite the turmoil in markets caused by the coronavirus pandemic, arguing that this would be "only the beginning" of a much larger shift in investment practices. He noted that the company's sustainable investment products had performed much better than conventional products in the difficult environment of a global health crisis, which "shows that sustainability not only has a theoretical but also a practical component to it" and generally helps to better cope with risks. "This hypothesis is now confirmed," the Swiss manager said, adding that companies would now be compelled to move into a more sustainable direction when it comes to securing funds. "Those who don't move towards sustainability will be rebuked by markets," he said.

BlackRock announced at the beginning of the year that it would start to better integrate sustainability aspects and the so-called ESG (environmental, social, governance) investment criteria in its operations. The company since appeared to largely follow through with its proclamation, amongst other things by denying support for board members of several energy-intensive companies in Germany that the US investment management firm is a shareholder of.